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Global manufacturing is poised to drive machine tool sales strongly upward, according to the global Purchasing Manager’s Index (PMI). The prediction, along with several others, was made in the Global Industry Analysts report, “Machine Tools: A Global Strategic Business Report”. In this post we’ll look at the machine tools forecast by region. The Purchasing Managers’ Index is based on a no growth reading of 50.0. Higher numbers show growth. GIA Inc. Unites States: no debt drama, higher costs for Chinese manufacturers In the United States, the manufacturing sector is witnessing growth supported by two main drivers. First are gains in GDP. The stable GDP outlook for the year 2015 will encourage an increase in domestic production of manufactured goods, adding fuel to machine tool sales. The second is the “No Budget, No Pay Act of 2013”, which allows the US treasury to borrow funds as required to keep the government in action. The USA has had political standoffs on the debt issue previously, but this time around the fiscal cliff drama is receding into the background, eliminating the threat of debt default. This is creating a more stable US economy that is ready to borrow, expand, and create new employment opportunities. Domestic manufacturing in the country is also poised to benefit from increased re-shoring of manufacturing activity in chemicals, metals and other industries that benefit from cheap natural gas prices. Existing challenges to offshoring such as increasing labor costs in China, volatile global fuel prices and transportation costs, plus the disadvantages of globally-dispersed supply chain, will open opportunities for re-shoring. Europe: Easing austerity and slowly rising household incomes In Europe, the relative financial stability and the slow return to economic profitability and growth are encouraging the domestic manufacturing sector. The recovery process is being fueled by: · Less focus on austerity · Improvement in government spending · Rising household income levels · A resurgence in consumer and business sentiment The recent launch of a new Manifesto by the European Commission and proposed policy amendments to improve the competitiveness of the domestic manufacturing industry shows a renewed political will to promote a strong manufacturing sector. The manufacturing industry remains vital to Europe’s economic recovery. To rebuild a sustainable economy in the region, the EU has implemented a target of increasing industrial output in the region to over 20% of the GDP by 2020. Offshoring of manufacturing jobs to Asia is already declining, while a parallel increase in re-shoring is improving domestic manufacturing opportunities. To cement its manufacturing base, the EU is stepping up investments in new technologies such as additive manufacturing, robotics, and nanotechnology, as well as existing cutting, molding and fabricating technologies. Asia Pacific: Still the growth leader The report confirms that the Asia-Pacific region represents the largest machine tool market worldwide. The region also ranks as the fastest growing market with a forecast CAGR of 9.4% led by rapidly growing manufacturing and industrial activity. Growth is especially strong in India, Thailand, Malaysia, Taiwan, and South Korea. Government initiatives such as development of Special Economic Zones industrial corridors, industrial clusters, fab cities and textile parks, along with subsidies and tax cuts to manufacturing groups are also fueling growth. Improvements in road, rail and marine infrastructure are also key growth enablers. Trade-related benefits from governments such as reductions in import duties on imported raw materials and semi-finished goods, as well as export related incentives on finished goods, machinery and equipment, are also factors spurring growth in the region. . The GIA report identified the following major players in the market: Allied Machine & Engineering Corp, Amada Co. Ltd., Amada Machine Tools America Inc., Dalian Machine Tool Group Co., Ltd, DMG Mori Seiki AG, DMG Mori Seiki Co., Ltd., DMG-Mori Seiki USA, Doosan Infracore Co. Ltd., FANUC Corporation, GF Machining Solutions, Gildemeister Italiana S.p.A. , Haas Automation Inc., Hardinge Inc., Hyundai WIA, JTEKT Corporation, Kennametal Inc., KMT Waterjet Systems Inc., Komatsu NTC Ltd., MAG IAS GmbH, Makino Milling Machine Co. Ltd., Okuma Corporation, Otto Bihler Maschinenfabrik GmbH & Co. KG, Sandvik AB, Sandvik Coromant, Schuler AG, Shanghai Machine Tool Works Co., Ltd, Shenyang Machine Tools Co. Ltd., Sodick Inc., Spinner Werkzeugmaschinenfabrik GmbH, TAJMAC-ZPS, Trumpf Group, Walter AG and Yamazaki Mazak Corporation. The GIA report can be purchased here. |