Manufacturing technology orders in the U.S. totaled $360.8 million in August 2024, with orders for metalworking machinery increasing by 22.7% from July 2024, according to a report published by the Association of Manufacturing Technology (AMT).
August orders declined 12% from August 2023.
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While orders continue to lag those placed in 2023, order activity remains above historic levels, indicating a period of normalization following COVID, rather than a true decline.
Year-to-date orders reached $2.81 billion, a 11.5% decline compared with the first eight months of 2023.
Orders from contract machine shops increased in both number of units and value of orders for the first time since March 2024. Since job shops typically absorb elevated capacity needs from OEMs, this buying trend indicates that production could continue to grow.
Aerospace manufacturers increased the value of orders by 13% and number of units by 27% from July to August 2024. This indicates their purchases are for additional capacity, which is confirmed by the persistently increasing capacity utilization rates in the sector. While machinery orders from manufacturers of aerospace parts have been strong in the past few months, the ongoing strike of Boeing machinists has the potential to dampen this demand.
The automotive industry has pulled back orders following a historically elevated buying cycle over the summer of 2023.
The Southeast region showed growth in manufacturing technology orders when comparing August 2024 to the previous month.
Although August 2024 orders fell short of those placed in 2023, the outlook for the remainder of the year remains optimistic.
Historically elevated capacity utilization rates across durable goods manufacturers indicate a very real need for additional investment in manufacturing technology.
With the upcoming U.S. presidential election and the Federal Reserve beginning to reduce interest rates and signaling additional reductions, two of the major issues holding back additional capital investment will be alleviated by year’s end. These factors along with the coming expiration of bonus depreciation of capital equipment and the momentum of order activity in the last four months of 2024 will likely accelerate and could carry over into 2025.
