Construction Equipment Outlook

 

A robust American manufacturing sector is necessary so our economy can compete with other countries and our equipment manufacturers, such as Caterpillar, are able to prosper and grow right here.
Courtesy of Caterpillar

Construction machinery manufacturers predict overall business in the United States to close out 2010 with 6.4-percent growth, then gain 12.7 percent in 2011 and 14.8 percent in 2012, followed by 2013 growth of 13 percent.  

“While this rebound is welcome, you have to remember our industry was down 30 to 50 percent in the recession, so there is a long way to go. Although business is improving, it will take years to recover the sales losses of 2008-2009,” said AEM President Dennis Slater.

AEM conducted a survey of the off-road equipment manufacturing industry. Each business-activity forecast is the average of responses from manufacturers in each product line. The association predicted industry-wide expectations rather than individual company performance, and unit sales rather than company profitability.

The survey asked respondents to rank how several factors would influence sales. Not surprisingly, a key impediment to growth in the construction equipment industry is the stagnant housing market. The general economy, including credit availability, also continues to be a major factor, as is highway funding. The brightest spot is increased export demand.

“The housing market is still very weak, stimulus-funded projects are nearing an end, and state and local budgets continue to shrink. Unemployment in the manufacturing sector remains stubbornly high. In construction, unemployment is still about double the national average; for example, construction unemployment was 18.8 percent for November 2010,” Slated said.

- Courtesy of AEM