European Industrial Production, October 2023: Eurostat also published its output data this week, although they use Industrial Production (IP) (the largest part of which is manufacturing, but it also includes energy and utilities (but not construction) as the top-level aggregate. Also, the way in which Eurostat publishes these figures requires a lot of digging to get to the 3-month rolling trends we prefer to use.
The report for October shows that, compared to September, total IP fell by -0.5% in the EU and -0.7% for the sub-set of the Euro-zone. Looking back to October 2022, total IP declined by -5.5% for the EU and -6.6% in the Euro-zone.
The month-on-month comparison shows that the capital goods industries led the downturn with output falling by -0.9% in the EU and -1.4% for the Euro-zone (compared to September 2023). There is a similar pattern in the comparison with October 2022 in that the largest reductions were in capital goods output which fell by -8.0% in the EU and -9.7% in the Euro-zone.
Staying with the 12-month comparison, of the 26 Member States who have published the data (Cyprus is missing as usual), total IP increased in 10 and fell in 16, although this is an improvement on the September picture when only 5 countries (including the now published Cyprus) had an increase in total IP.
In October, the largest percentage increases in output were in Greece (+10.8%), Denmark (+6.9%) and Slovakia (+4.4%); the most significant reductions compared to October 2022 came in Ireland (-34.0% – but note that this is often very volatile due to the large presence of multi-national company’s headquarters), Estonia (-12.2%) and the Netherlands (-11.1%).
Among the largest EU economies, the changes in output in October 2023 were relatively modest ranging from growth of +1.8% in France to contractions of -1.1% in Italy, -1.4% in Spain and -3.9% in Germany.
You can get the full details from the Eurostat News Release which can be downloaded from their website at https://ec.europa.eu/eurostat/news/euro-indicators (13 December) or it can be requested from MTA.
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USMTO and CTMR, October 2023: The US Manufacturing Technology Orders (USMTO) programme tracks orders in the US market, based on the reports from participants and in the first ten months of 2023 (January to October) total orders are -13.5% lower than the level in the same months of 2022. The pace of this change has been broadly stable over the past six months and it is worth noting that the values are still relatively high by historical standards.
The strike by the United Auto Workers’ Union, which ran through most of October, does not appear to have had much impact on investment spending by the industry and some other sectors are also still improving. One notable trend is that jobs shops, which had been investing in higher-end equipment (measured by higher average values), appeared to have reversed this trend in October by buying more units but with a lower total value being recorded. More details on these trends are int eh AMT Press Release.
Analysis of the regional data shows that all 6 areas had lower order values in the first ten months of this year compared to the same period in 2022. The declines in the South-Central, North-East (both -2%) and North-Central-East (-6%) regions were relatively modest but there were more substantial reductions in the North-Central-West (-14%), South-East (-20%) and West (-34%) areas.
The US Cutting Tool Market Report (CTMR) tracks the tooling business on a similar basis with the first ten months of 2023 seeing growth of +7.9% compared to the same months of last year. There is no regional breakdown of this market but the press release announcing the latest figures notes a degree of caution about the prospects for 2024, with a variation in the trends coming from different customer industries in the context of ongoing “softness in US manufacturing”.
You can download the press releases for the two surveys from the AMT web-site at www.amtonline.org/topic/intelligence, with the CTMR release also published on the USCTI web-site at www.uscti.com; alternatively, you can request either or both releases from MTA and we can make sure you get them when they are published each month.