Construction Equipment Market Continues to Weaken
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RSS FeedMay equipment sales dropped 3% from April. While May orders rose slightly, orders remain more than one-third below current shipments and manufacturers’ unfilled orders are still dropping sharply due to order cancellations. Shipments are expected to drop a further 10% by next winter. Then a slow improvement is expected driven by depleted inventories and deferred replacement needs. However shipments by the end of 2010 will still be about half of the early 2006 peak level.
Equipment prices are now flat to slightly up. The impact of the weakening $US is offsetting the impact of the weakening construction market. But equipment rental rates, a strictly domestic market, are now declining. Rates fell 1% in June.
US Equipment Market – July 2009
| Apr 09 Actuals |
May 09 Actuals |
Latest Month (May 09) | |||
| Versus Year Ago |
Versus 3 Months Ago |
Versus Previous Month |
|||
| $Millions, seasonally adjusted | $US millions (seasonally adjusted) |
||||
| US Equipment Manufacturers | |||||
| US Factory Shipments | 1,506 | 1,461 | -35.8 | -19.5 | -3.0 |
| US Factory Orders | 919 | 1,025 | -65.3 | -14.4 | 11.5 |
| US Factory Unfilled Orders (month end) | 9,266 | 8,830 | -36.2 | -20.5 | -4.7 |
| US Factory Inventory (month end) | 5,328 | 5,252 | -4.9 | -8.8 | -1.4 |
| US Factory Order Backlog (months) | 6.2 | 6.0 | -0.6 | -1.3 | -1.8 |
| US Equipment Imports | 638 | 571 | -51.4 | -13.2 | -10.5 |
| US Equipment Exports | 980 | 901 | -46.9 | -16.2 | -8.1 |
| US Equipment Consumption | 1,187 | 1,207 | -29.5 | -6.8 | 1.7 |
| (shipments - exports + imports +/- inventory change) | |||||
| Construction Equipment Price Index | 191.1 | 191.6 | 3.9 | -0.4 | 0.3 |
| Construction Equipment Rental Price Index | 118.1 | 116.9 | -1.9 | -0.7 | -1.0 |
Data Sources: US Department of Commerce and US Department of Labor
Table: Reed Construction Data
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