- 21 March 2008 -
Metalformers Look for
‘Steady Business’ Over Short Term

Metalforming companies expect business conditions to remain steady during the next three months. This outlook is based on the newly released Precision Metalforming Association (PMA) Business Conditions Report.

When asked what the trend in general economic activity will be over the next three months, metalformers expect little change. Fifty percent of participants reported that activity will remain the same (down from 54% in February); 19% anticipate that conditions will improve (up from 14% last month); and 31% predict a decline in business conditions (down from 32% in February).

Metalforming companies also expect incoming orders to remain virtually unchanged over the next three months. Thirty percent of companies forecast an increase in orders (compared to 31% in February); 42% anticipate no change (compared to 39% last month); and 28% expect a decrease in orders (down from 30% in February).

Current average daily shipping levels remain steady as well. In March, 30% of participants reported that current average daily shipping levels are above levels of three months ago (up from 29% in February); 46% reported no change (the same percentage reported last month); and 24% reported that shipping levels are below levels of three months ago (down from 25% in February).

At the same time, the number of metalforming companies with a portion of their workforce on short time or layoff rose to 19% in March from 16% in February.

“Uncertainty over general economic conditions exacerbated by sharp first-quarter cutbacks in housing starts, reduced production volumes for autos and light trucks, and slowing orders for durable goods have impacted many metalforming companies in the first quarter of 2008," said William Gaskin, PMA president. “However, based on reports from PMA members, the weak dollar is supporting export growth so domestic manufacturing may be stronger than the U.S. media would have us think. While some companies report significant cutbacks, most report stable shipment levels and expect that orders will improve modestly in the second quarter.”

According to Gaskin, metalformers are concerned about sharp increases in raw material prices and whether they will be successful in recovering added costs from their customers. In addition, they are aggressively seeking productivity improvements to increase their efficiencies through automation and capital investment, he noted.

To view the full March report, please visit www.pma.org/about/stats/BCreport.