Machine tool business outlook remains strong

Jan. 9, 2007

The Agie Charmilles Machining Business Activity Index was unchanged at 60 in November, 2006. The Index is created from a survey of machine tool users concerning their current business level compared to three months earlier (August, 2006), and any reading above 50 indicates that business activity has improved. Business activity was strongest in the electrical discharge machining job shop sector and in the Central United States.

The Agie Charmilles survey also found that the November, 2006, 30-day delinquency rate on machine tool leases measured less than 2 percent, a level lower than the 4.7 percent delinquency rate on home mortgages. The Agie Charmilles and U.S. Bancorp Equipment Finance Machining Industry Financial Strength Index was 333, compared to 294 in October, 2006, 370 in November, 2005, and 55 in January, 2002, the lowest reading on record. Any reading above 100 indicates that machine tool lease payment delinquencies are at a rate below the average of 1990 to 1999. As profitability rises, liquidity rises, delinquencies fall and the Index rises. Detailed historical data is available at (