ADDITIVE MANUFACTURING is the magazine devoted to industrial applications of 3D printing and digital layering technology. We cover the promise and the challenges of this technology for making functional tooling and end-use production parts.
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MARKET DATA REVIEW CATEGORY: E Economics mtadditive.com 17 By Pat McGibbon VP – Strategic Analytics AMT—The Association For Manufacturing Technology In fall 2017, AMT members were very upbeat about how markets are doing both here in North America as well as around the globe. The tone was clearly positive at EMO with expectations that busi- ness was trending up and would for the next several quarters. The event's final registration number was 128,966 with 48 per- cent of that from outside the EU. The show organizer reported a mind-boggling 8 billion euros in deals taking place at EMO. At the close of every month we talk to a significant number of AMT members seeking information about outstanding requests, committee work, data for the surveys they participate in or to validate news we have heard elsewhere. These conver- sations were positive in every instance even though in some in- stances members noted that specific industries in their region or technology markets were showing signs of slow of slowing. Talk of auto orders slowed down by mid-October, along with slower conversion times on quotes to state and federal govern- ment agencies. Aerospace quotations and medical equipment quotation activity and orders were both on the rise throughout Looking Toward an Up Year in 2018 Top 10 indicators align with information voiced by AMT members and speakers at GFMC. The September Purchasing Managers' Index (PMI), produced by the Institute for Supply Management, was 60.8, the highest level in more than 12 years. Likewise the Metalwork- ing Business Index (MBI), produced by Gardner Business Media, posted 57.6, the highest the index has been since its inception. Both indices suggest that manufacturing will continue to expand through at least spring 2018. Durable goods order growth over the last two months is averaging a 24 percent annual rate, which is a clear signal that demand for our customers' products is growing rapidly. Even the weakest link, the Baltic Dry Index, is moving upward and is nearing a point that the yellow turns to green. Segment Business Conditions Status Notes Manufacturing Technology Business Conditions Manufacturing tech orders are on the upswing Durable Goods Manufacturing Business Conditions Several key industries are lagging but manufacturing is still growing Economic Indicators Summary Status Notes Purchasing Managers Index PMI has hit highest point in more than 12 years Capacity Utilization for Mfg. Capacity utilization continues to wobble its way upward Orders for Mfg. Durable Goods Paris Air Show can take credit for the 7 percent jump in July but the $239 billion in September reps a strong mfg sector Housing Starts Housing starts continue to be a strong point in the indicators 30 Yr. Mortgage Rate Rates continue to be low compared to historical averages Consumer Sentiment Consumer sentiment bounces in the 90s, which is a positive sign MBI New to the 10 indicators - closely related to manufacturing tech orders and has been more than 50 since January Light Vehicle Sales Annual sales rate tops 18 million and bolsters profits Baltic Dry Index Index is soft but growing at double-digit rates Restaurant Performance Index Sitting just above 100, the index rests at the lowest value that still represents a signal for healthy business levels the Midwest and Southeast. In general, the conversion rates and quotation activity suggested a strong finish to 2017 across the country including the Southwest, which saw significant auto, aerospace and consumer product orders. AMT analysts conducted surveys and market intelligence at South-Tec in Greenville, South Carolina, and returned with interviews and experiences that support the continued acceler- ation of the manufacturing technology market in the Southeast region. While attendance at that event was up modestly, it was clear that attendees were more serious in their research than in 2015 as it appeared that they hit more booths and were at the 2017 show longer than at the previous show. The attendance felt smaller according to several exhibitors. However, when staff asked to check in on leads generated in 2015 for the same com- parable time period, the 2017 results were considerably higher. Interviews with attendees painted a picture of a crowd looking to buy the latest technology that could increase their floors' pro- ductivity and offset their inability to hire enough skilled labor. Always nice to see the anecdotal evidence from shows and calls validated by facts and forecasts. Forecasts presented at October's Global Forecasting and Marketing Conference (GFMC) support the gut feelings of our members. The four economists at the conference were unan- imous in their upbeat outlooks for the end of 2017 and that would continue throughout 2018. Their outlooks diverged as they depicted their respective scenarios for the manufacturing technology markets in 2019 and beyond. Differences were in assumptions on federal legislation; the speed of technological evolution in key customer industries; cultural market develop- ments; economic growth in key industrial sectors and geo- graphic markets; and the development of resource constraints. The good news is that the economists' forecasts for beyond 2018 range from continued growth to modest recession less than 24 months since this recovery started. There was no severe doom and gloom message for our markets over the next five years. However, both the economists and analysts providing customer industry insights clearly developed the case that this rising tide of this recovery will not float all customer sectors' evenly. Some customer sectors will be expanding rapidly in 2018 and well into 2019 while others are already showing weakness in late 2017. If you have any questions about the information above, please contact me at 703-827-5255 or pmcgibbon@amtonline.org.