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Metalworking business activity is slowing

Metalformers Business Outlook Continues to Drop

July 9, 2024
The June 2024 PMA Business Conditions Report indicates metalforming manufacturers are becoming less optimistic about future economic activity.

The June 2024 Precision Metalforming Association (PMA) Business Conditions Report shows a continued decline in metalforming manufacturers' outlook for the coming months. In May, metalformers' forecast for economic activity over the next 3 months dipped for the first time in 2024 and the June report indicates it is an ongoing trend for this sector. 

Per the June PMA report, only 14% of metalforming manufacturers said they see economic activity increasing in the next 3 months which is down from the 19% who said the same in the May report. Another 30% expect a descrease in activity, up from 26% who felt the same in May, while 56% do not anticipate any change in economic activity. 

Incoming orders are expected to decline in the coming months with 26% indicating as such, up from 19% who said the same in May. Those expecting orders to increase are down to 24% as opposed to the 32% who said in May they anticipated increased order activity. About half of respondents to PMA's June survey do not expect any change in orders. 

Despite the decreasing economic sentiments in this sector, PMA reports that the current average daily shipping levels in June remained steady with 46% reporting no change, 25% seeing an increase, up from 21% in May, and 29% indicating declines in shipping levels which is down just 1% from May. 

“The June survey confirms that PMA members are seeing a slowdown in economic activity, which tracks other recent reports for the manufacturing sector that are reporting a contraction in activity,” said David Klotz, PMA president. “Our members are reporting a general sense of uncertainty over industrial demand, the election outcome, and whether tariffs will go up in 2025 and taxes will go up in 2026. The current environment makes it difficult for downstream companies to plan and respond to their customers’ concerns over similar uncertainties in the markets and over who will be in control of Washington after the November election.”

Another potential impact to this sector is the shift taking place in the automotive market to electric vehicles (EV). Per Jim Meil, Principal, Industry Analysis at ACT Research who presented during the National Fluid Power Association (NFPA) spring economic webinar, many manufacturers are questioning whether they continue investing in metalworking machinery due to the changing material needs of EVs. How this plays out is yet to be seen, but a factor to monitor as various markets shift to alternative powertrain options. 

PMA, the trade association representing the North American metalforming industry, compiles its Business Conditions Report each month to provide an economic indicator for the next 3 months of manufacturing based on insight from 121 metalforming companies in the U.S. and Canada.

Metalworking and machine tools are an important customer segment for the fluid power industry, and therefore monitoring business activity in this sector can be a helpful indicator for the performance of the hydraulics and pneumatics market. 

About the Author

Sara Jensen | Executive Editor, Power & Motion

Sara Jensen is executive editor of Power & Motion, directing expanded coverage into the modern fluid power space, as well as mechatronic and smart technologies. She has over 15 years of publishing experience. Prior to Power & Motion she spent 11 years with a trade publication for engineers of heavy-duty equipment, the last 3 of which were as the editor and brand lead. Over the course of her time in the B2B industry, Sara has gained an extensive knowledge of various heavy-duty equipment industries — including construction, agriculture, mining and on-road trucks —along with the systems and market trends which impact them such as fluid power and electronic motion control technologies. 

You can follow Sara and Power & Motion via the following social media handles:

X (formerly Twitter): @TechnlgyEditor and @PowerMotionTech

LinkedIn: @SaraJensen and @Power&Motion

Facebook: @PowerMotionTech

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