The October figures for US orders for from our colleagues at AMT suggest that both markets have flattened off recently, although machinery is at the bottom of the cycle while tooling is at the top. The strikes at Boeing, which lasted for most of the month, add a complication to interpreting the latest data.
The US Manufacturing Technology Orders (USMTO) programme tracks orders in the US market, based on the reports from participants in the survey. In the first ten months of 2024 (January to October), total machine tool orders were -7.5% lower than in the same period of last year and the rolling-annual total is -6.1% lower than in the previous 12 months. The pace of decline in both of these measures continues to slow, pointing to a flattening of the market situation at the bottom of the current cycle.
However, the AMT press release notes orders in October were 3% higher than the long-run average for this month, so it is not quite as stark as the headline might appear. They also note that orders from contract manufacturers fell in October for a variety of reasons including uncertainty around the Presidential election and the Boeing machinists strike which released some capacity in companies serving the aerospace sector. On the other hand, the aerospace sector itself saw machine tool orders increase in October.
For 2024, we only have the data for metal cutting machines at the regional level (although this accounts for more than 98% of the total, so it is valid for the trends) and on that basis, only the Western region (+14%) is showing significant growth; the South-East (+1%) group of States is broadly neutral while the other 4 regions have a decline compared to the first ten months of 2023 – this ranges from -5% in the North-Central-West, through -14% in the North-East and -16% in the North-Central-East to -20% in the South-Central area.
The US Cutting Tool Market Report (CTMR) tracks orders for tooling on a similar basis and in the first ten months of this year, shipments were just +0.6% above the level in the same months of 2023 (January to October). The 12-month rolling total is still positive but at +0.8% it too has continued to decline since the peak at the start of 2023. Analysis of the annualised total shows that the market for cutting tools has, like that for machine tools, levelled off but, in this case, at the top of the current cycle.
The press release on the CTMR highlights similar issues to those affecting the machinery side of the industry that we have already noted, but rather underplays the impact of the strikes at Boeing so it will be interesting to see the extent of any recovery in November and into 2025 to indicate the underlying strength of activity.
You can download the press releases for the two surveys from the AMT web-site at https://www.amtonline.org/topic/intelligence, with the CTMR release also published on the USCTI web-site at www.uscti.com (go to the News tab); alternatively, you can request either or both releases from MTA and we can make sure you get them when they are published each month.