New data from the U.S. Manufacturing Technology Orders Report, published by AMT – The Association For Manufacturing Technology, reveals the state of manufacturing technology orders in August 2023. The report indicates that new orders for manufacturing technology reached $404.2 million in August, marking a notable 16.1% increase compared to July 2023. However, this figure represents a 12.2% decline from August 2022.
Year-to-date orders, encompassing the first eight months of 2023, reached a total of $2.23 billion. This amount is 12.6% lower than the orders recorded during the same period in the previous year.
AMT President Douglas K. Woods noted that the industry is experiencing a divergence in spending patterns. Industries focused on shorter-term projects have reduced their spending, while original equipment manufacturers (OEMs) with longer-term production timelines have increased their investments. This has resulted in orders maintaining an elevated level.
The gap between year-to-date orders in 2022 and 2023 has gradually narrowed, decreasing from a 14.6% deficit in May to the current 12.6% difference.
The report also highlights that job shops, despite maintaining an elevated share of unit orders, have continued to place orders for machinery below their typical monthly levels. On the other hand, OEMs are increasing their purchases of specialized machinery for manufacturing complex, high-value parts.
Automotive transmission manufacturers have shown a sustained increase in orders, marking the highest three-month streak of orders since June to August 2017. Manufacturers in the engine, turbine, and power transmission technology sector are also rapidly increasing their orders.
The current upward trend in manufacturing technology orders represents the largest sustained increase since the surge in orders observed in the summer of 2008. This earlier increase was driven by the shift from coal-fired power plants to electricity generated by natural gas turbines.
Looking ahead, Douglas K. Woods emphasized the importance of monitoring consumer spending to gauge the future trajectory of manufacturing technology orders. Various challenges, including mortgage payments taking up a larger portion of discretionary income, wage stagnation in some industries relative to inflation, and ongoing labor disputes affecting production, pose potential headwinds for both consumers and the manufacturing technology industry.
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