March Machine Tool Orders: Units Down but Dollars Up

According to USMTO, machine tool sales in March were 2,191 units and $468,086,000 in real dollars. Unit sales in March 2013 were 7.1% less than they were in March 2012. This is the third time in four months that the month-over-month rate of change for units has contracted. The rate of contraction in March was the fastest of those three months. March also saw orders above 2,000 units for the first time in two months (although February was very close at 1,996 units). The annual rate of change continued in its decelerating growth trend. However, the annual rate of change was virtually unchanged from February to March, dropping from 1.5% to 1.2%.

My unit forecast for March was for 2,500 units to be ordered. This was too high by 14.1%. My forecast for the first was too high by 7.7%. This is not far enough off to revise my forecast. My forecast does call for the month-over-month to start growing again in April through August. Whether this is right or not will determine whether unit sales continue to grow annually at a slow rate of begin to contract.

While unit sales continued to contract month-over-month in March, real dollar sales grew month-over-month for just the second time in 10 months. This is very positive news. And, the monthly rate of growth was strong enough that the annual rate of change slowed its rate of contraction. Also, the strong dollar sales in March sent the average price of a machine up to $214,000. This is the first time the average price has gone above $200,000 since August 2012 and it is the 10th highest monthly average for a price of a machine in real dollars since February 1996. So, in terms of real dollar sales, March 2013 was a fantastic month.

For more information on machine tool sales and the leading indicators go to our metalworking page.