Economic News Blog
Posted by: Steven Kline, Jr. 12. October 2016

USMTO Grows 16.1% in August

In August, machine tool orders were 1,966 units and $325,534,000. August was good month for machine tool orders as orders were very nearly 2,000 units, which is a sign of a solid machine tool market. As our forecast from last fall said, it appears that the industry has bottomed and should contract at a slower and slower annual rate through the end of 2017.

The unit order total in August was the highest since March. Compared with one year ago, unit orders were up 16.1 percent in August, which was the first time unit orders grew since April 2015. Also, it was the second fastest rate of growth since February 2012 (only the IMTS fueled September 2014 was faster). While, the annual rate of change contracted for the 12th month in a row, it contracted at the slowest rate since March. 

Real dollar sales were up 15.9 percent compared with August 2015. That also was the first month of growth since April 2015. The annual rate of change contracted for the 15th month in a row, but August was the slowest rate of contraction since March. However, the average price of machine fell to $166,000, which was the lowest average price since December 2015. And, that average price was 7.5 percent below the historical average of $179,000.

There was growth in every region, including the South Central that has been decimated by the low price of oil. The Southeast region continued to be the strongest performer. Unit orders were up 43.1 percent  while dollar orders were up 48.6% in August. The average price in the Southeast was above the historic average for the third straight month. While the actual numbers in the South Central remained low, unit orders were up 38.2 percent and dollar orders were up 50.5 percent in August. 

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