2003 World Machine Tool Output & Consumption Survey

Production

Both Germany and Japan went down in 2002, but Germany’s dip in production of machine tools was not as steep as that of Japan, so Germany again takes the lead it last held in 2000 as the world’s top producer. The two have been running together, ahead of all other producing countries, since West and East German outputs were combined in 1991.

   Japanese production declined nearly one-third, in large measure as its North American markets eroded during 2002. Germany was not hit by industrial recession quite as hard.

   Currency fluctuations, as usual, play a small role in comparisons, also. Whereas the German decline from 2001 to 2002 was 17% measured in euros, it became less steep when converted to dollars. On the other hand, Japan’s 30% yen-based decline worsened when the conversion rate was applied.

   Together, Germany and Japan account for around 42% of the value of machine tools produced in the world, down several percentage points from revised numbers for 2001.

   The steepest year-to-year decline among major machine-tool-producing countries was that of the United States, 33%. Its drop to under $2-billion in estimated 2002 output moved it behind China into fifth place, from the fourth slot one year ago .

Trade and Consumption

The size of a particular national market can be measured by the “apparent consumption” seen in the table on the next page. Apparent consumption is calculated as a country’s domestic production, less its exports, and plus its imports.

   It’s a more stable measure of a market than other indicators like orders , such as compiled by the U.S. Machine Tool Consumption series of reports from AMT and AMTDA. That’s because the time lag between placement of an order and actual shipment from the factory or warehouse can vary widely, depending on market conditions, inventory levels, the type of machine (some are built more quickly than others), and even the time of year (as in summer shutdowns). In contrast the formulaic consumption reported in this survey measures machines that are actually delivered.

   Within the top ten consuming countries, China is the only one that has an increase in consumption (+20%) in 2002.

   Among major users, the United States has the largest percentage decrease (-36%). A year ago, it moved out of first place among consuming countries for the first time since 1993. Now America resides in fourth place, using only 58% of the value that China uses.

   The U.S. is hardly alone in eroding consumption: Sixteen of the 28 reporting countries have double-digit declines in apparent consumption for 2002. Japan shows a 32% decline in consumption; France has a 27% decrease.

   An interesting variation on the consumption measure is consumption weighted for population (per-capita table). It’s a way of envisioning a country’s relative rate of industrialization. Switzerland continues to be the most machine-tool-oriented nation; on average its machine-tool spending comes to $78 for every person in the country, down from $93 in 2001. The U.S. spends $12 and stays in the same slot (#17) as a year ago in relative ranking.

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