PMPA’s Business Trends Index of Shipments fell to 100 in September, a non-seasonal move that shows our industry shipments gain for the year slipping to just 102% year to date.
September shipments are just 88% of same month last year.
The slump in sales was widespread in September; of 92 companies reporting this month, only nineteen (19) were in positive territory, and just ten (10) of those in the double digits. Seventy–three (73) firms reported declines, and sixty-three (63) of those reported double digit sales declines compared to prior month.
You can’t grow faster than GDP forever…
The three month moving average (3 MMA) for sales has fallen below the 12 MMA for the second month in a row. This indicates that our industry’s shipments are no longer growing.
While we still have confidence in our industry’s ability to record a very positive increase in shipments by year end, we are aware of the “regular and special causes” that seem to be suppressing orders and shipments at this time.
The “regular causes” that we see operant are the stagnation of demand in the broad economy. We believe that this is exacerbated by the “special causes” of the present uncertainty of the 1) November election and 2) Spending cuts mandated by the looming ‘Fiscal Cliff.’
Precision machined products are crucial components that perform vital functions in critical technologies including anti lock brake, airbag depoyment, HVAC, fluid power, aerospace, and medical device (including implant) applications. According to the latest U.S. Census Report precision machining industry shipments totalled $13.3 billion in 2010.
See the full report for detailed outlook on Sales, Lead Times, Profitability, and Employment.