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Machine Tool Orders Drop 12%

June 15, 2021
U.S. manufacturing technology demand slowed in April but the post-pandemic recovery proceeds, ensuring a robust year-over-year gain.

U.S. machine shops and other manufacturers ordered $404.6 million worth of new capital equipment during April, -11.7% less than during March, and yet 72.3% higher than the April 2020 new-order total. “April 2020 had the lowest orders in a decade, but the previous three months were business as usual, so to be 40% up over the previous year shows the real strength of the industry in 2021,” commented Douglas K. Woods, president of AMT – the Assn. for Manufacturing Technology. 

AMT supplied the data in its monthly U.S. Manufacturing Technology Orders Report. The USMTO report is a forward-looking index to manufacturing activity, tracking manufacturers’ capital investments in anticipation of future work orders. It incorporates actual figures for new orders of metal-cutting and metal-forming and -fabricating equipment, nationwide and in six geographic sectors, based on information supplied by participating producers and distributors of that equipment.

For the current year to-date, USMTO orders total $1.57 billion, which is 40.1% higher than during January-April 2020, as the AMT president noted.

“Parts that would normally go to job shops are now being produced in-house by larger manufacturers with the means to increase their production capacity,” Woods observed. “This is not to say production is shifting away from job shops; they are still operating at near-capacity and increasing machine orders month over month, but increased consumer demand has necessitated more capacity, and confidence in the sustainability of that demand has justified the capital expenditure by large OEMs. As a result, our members have seen a resurgence of multi-machine orders near 2018 levels.

Woods described several positive factors contributing to demand for metal-cutting and forming machinery, including automotive design changes for mold-and-die manufacturing; new energy-exploration efforts and mining activity; and high demand for consumer products.

“However, supply constraints have meant new orders are being added to an already growing backlog,” he said. “The demand for manufacturing technology is there, and the suppliers who can deliver on orders will be in a position to one-up their competition in the near term.”

As for the declining order volume from March into April, only one of the six regions reported an increase in new orders: In the South Central region, manufacturers ordered $33.35 million worth of new metal-cutting machinery, 9.9% more than during March and 80.3% more than during April 2020. For the current year-to-date, South Central regional orders total $110.8 million, which is 34.0% higher than the January-April 2020 order volume.

Demand for new metal-cutting machines fell to $74.0 million in the Northeast region, or -8.3% from March, up 20.8% from April 2020. In the Southeast, new orders for metal-cutting machinery fell -10.1% from March to $42.75 million, still up 17.0% from the April 2020 result.

In the North Central-East, new orders for metal-cutting machines totaled $100.99 million during April, though this figure is -13.1% lower than the March result, and 199.5% over the April 2020 figure. The North Central-West region’s new orders for metal-cutting machinery fell -9.0% during April to $81.65 million, but that is a 134.4% increase over April 2020’s result.

In the West region, new orders for metal-cutting machinery totaled $66.31 million, -13.6% from March and 53.3% higher than the April 2020 total.

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