Source: Association of Equipment Manufacturers, Milwaukee
Construction equipment manufacturers anticipate overall business to close out 2011 with double-digit increases over 2010 in the U.S., Canada and worldwide. Growth is expected to continue, but at a slower pace, for 2012 through 2014, according to the annual business outlook survey of AEM, the North American-based international trade group representing the off-road equipment manufacturing industry.
Each year the association polls its construction equipment manufacturer members about anticipated sales of the machines and equipment that build and repair roads, bridges, houses, offices, schools and other infrastructure worldwide. Respondents were asked to rank several factors affecting future business.
The state of the general economy, including consumer confidence and credit availability, plus steel prices and the protracted slump in single-family housing starts, are significant negative factors influencing future sales, according to AEM "outlook" survey respondents. A key positive factor cited was the continued strength in export demand. The lack of substantial action on highway funding was cited as a negative factor, with respondents more hopeful for positive results in 2012.
For 2011, overall business in the U.S. is expected to grow 18.6 percent compared to last year; Canadian business is forecast to increase 14.7 percent; and industry business to the rest of the world is anticipated to gain 14.7 percent. For just the United States, the construction machinery business is predicted to grow 10.8 percent in 2012, 9.9 percent in 2013, and 8.1 percent in 2014.
"In 2011, construction equipment manufacturing kept improving from the depths of the recession as the economy stabilized. Earlier this year, it looked like the economy was truly turning around, but we still have some uncertainty, in both U.S. and international markets, and this is hampering stronger, more sustainable growth," stated AEM President Dennis Slater. "2012 is an election year, which does not bode well for meaningful action in Washington; both sides are already in full ‘campaign mode,’ it seems, and this presents a real danger of a stalling economy."
"Congress needs to focus on manufacturing policies that create and maintain jobs, not unnecessary and excessive regulatory and tax policy burdens. That is why we are continuing and expanding our ‘I Make America’ grassroots effort; it promotes a better understanding and appreciation of the vital role of manufacturing to a thriving American economy—providing good jobs, tax revenues and investment in local communities, for example," Slater added.
The final survey results will be posted online when available at www.aem.org.