MAPI comments on durable goods report
Aircraft orders, primary metals, and computer and electronic products industries down, but business machinery sharply up.
in the NewsState of Logistics 2016: Pursue mutual benefit Toyota’s new intralogistics division explained Making TMS an Enterprise Priority NAM’s Timmons to visit Columbus during State of Manufacturing Tour CBRE report highlights ongoing strong conditions for industrial real estate market More News
The U.S. Census Bureau report on durable goods shows that new orders for durable goods fell 5.2 percent in January 2013 after posting a 3.7 percent gain in December 2012, noted Daniel Meckstroth, chief economist for the Manufacturers Alliance for Productivity and Innovation (MAPI). “Durable goods orders are erratic and volatile; they are a mixture of very expensive, long lead-time products and categories that are short order, so order growth by industry is important. The January report is a good example of the negative top line failing to reflect the positive impact of order activity on near-term production.
“The primary reason for the decline in durable goods orders is the severe decline in both civilian and military aircraft orders. Defense aircraft orders fell 63.8 percent and civilian aircraft orders dropped 34 percent in January 2013 from December 2012,” Meckstroth added. “The federal budget sequester undoubtedly played a part in lower military aircraft orders and the battery problem with the Boeing 787 aircraft likely had some role fewer civilian aircraft orders. In both cases, the several-year lead time for aircraft will not affect current activity. Primary metals and computer and electronic products industry orders also fell in January. Importantly, however, orders for business machinery increased a large 13.5 percent.
“A key indicator for business equipment spending is orders for nondefense capital goods excluding aircraft,” Meckstroth concluded. “The indicator increased 6.3 percent in January and is a welcome sign that businesses are not completely put off by the political budget deadline gamesmanship in Washington. Business equipment spending growth is an important element in sustaining the economic expansion.”
Subscribe to Modern Materials Handling Magazine!Subscribe today. It's FREE!
Find out what the world’s most innovative companies are doing to improve productivity in their plants and distribution centers.
Start your FREE subscription today!
Automated Storage on the Move Receiving 101: Setting the Table for Success View More From this Issue