Qimtek Contract Manufacturing Index, 3rd Quarter 2023: The Qimtek Contract Manufacturing Index (CMI) uses data on the total purchasing budget for outsourced manufacturing of companies looking to place business in any given month to track activity in the sub-contracting sector. With two poor months in July and August, the recovery in September was not enough to prevent a halving of the market compared to the 2nd period of the year and being down by -63% compared to the previous year.
This suggests that the weakness over the summer was not entirely holiday related, although this was probably a factor. With the split of work across their three areas being broadly stable, they all shared in the downturn in the latest period – machining was half of the market (49% in Q2) and fabrication edged up to 42% (40%), meaning that the share or other processes (including moulding and electronic assembly) fell back from 10% to 7% of the market.
By sector, the most active group was industrial machinery for the 3rd quarter in a row, followed by communication equipment and defence, with the largest falls being in the construction and marine markets.
You can read the full details on the latest figures from the Qimtek website at https://www.qimtek.co.uk/news/engineering-capacity/subcontracting-orders-stall or request them from MTA.
USMTO and CTMR, August 2023: The US Manufacturing Technology Orders (USMTO) programme tracks orders in the US market, based on the reports from participants. Over the first eight months of 2023 (January to August), total orders are running -12.6% below the level in the same months of 2022.
The Press Release on the latest results notes that companies focused on longer term projects are continuing to increase their spending while smaller companies with more short-term outlooks are down. In particular, manufacturers of automotive transmissions have increased spending for the 3rd month in a row, giving the strongest period of demand since June to August 2017 in this group of customers.
The regional analysis shows that the downturn compared to the first eight months of last year is concentrated largely in two areas with the West at -33% and the South-East at -22%. The other 4 regions are also in negative territory but on a smaller scale ranging from -9% in the North-Central-West, through -6% in the North-Central-East and -4% in the South-Central areas to just -1% in the North-East.
The US Cutting Tool Market Report (CTMR) tracks the tooling business on a similar basis. This part of the manufacturing technology spectrum is still growing with consumption in the first eight months of 2023 running +8.6% higher than in these months of 2022. There are some notes of caution in the accompanying report, perhaps most notably around the impact of industrial action in the automotive industry (this started in mid-September) but, equally, some positives from investment in infrastructure projects and the continued re-shoring process.
You can download the press releases for the two surveys from the AMT web-site at www.amtonline.org/topic/intelligence, with the CTMR release also published on the USCTI web-site at www.uscti.com; alternatively, you can request either or both releases from MTA and we can make sure you get them when they are published each month.