NEMA's Industrial Control Business Indices Improve Over Last Quarter

May 1, 2003
pROSSLYN, Va. -- Following two consecutive quarters of declines, the NEMA Primary Industrial Control Index improved marginally in the first quarter of

p>ROSSLYN, Va. -- Following two consecutive quarters of declines, the NEMA Primary Industrial Control Index improved marginally in the first quarter of 2003. The first quarter index value of 71.8 marks a 3.6 percent improvement over the fourth quarter 2002. Unfortunately, even that improvement did not fully erase the effects of the earlier slide, and compared to the first quarter last year the index is still down 2.8 percent.

Similarly, the complementary index used to track industrial control and adjustable speed drive shipment activity, the Primary Industrial Control and Adjustable Speed Drives Index, demonstrated quarter-to-quarter improvement while remaining flat, to slightly down, in year-over-year terms.

This index stood at 93.7 in the first quarter 2002, and the current index value of 93.5 is just two-tenths of one percent off that year-ago result. Compared to the fourth quarter 2002, the current index is up 3.5 percent.

"Economic recovery has been erratic, and uncertainty regarding the conflict with Iraq was mentioned frequently as one reason for anemic growth.

Business investment has clearly been held in check because of several factors such as that uncertainty, overcapacity, and sluggish growth among U.S. trading partners," says NEMA's Steve Wilcox, director, market research. "With the close of the third quarter last year, capacity utilization had fallen for eight straight quarters." In the two most recent quarters, factory utilization has increased slightly, providing a measure of hope that manufacturers will be able to reduce the level of overcapacity.

Another potentially positive sign for the industrial control industry is the modest improvement in the production of industrial machinery. A steep run-up in production peaked in the fourth quarter of 2001. A steeper decline followed, but a modest recovery appears to have taken hold over the last two quarters as year-over-year growth turned positive for the first time in several quarters."

The NEMA Industrial Control Business Indices are issued quarterly by NEMA. The Primary Industrial Control Index represents U.S. shipments for motor starters, contactors, terminal blocks, control circuit devices, motor control centers, sensors, programmable controllers, and other industrial control devices (Figure 1). Because these data have been collected for some time, the primary index illustrates the market's trend over several years. In 2001, the NEMA data collection program was expanded to include adjustable speed drives, a key energy-saving industrial component. The Primary Industrial Control and Adjustable Speed Drives Index provides a broader measure of the industrial control marketplace (Figure 2).

Industrial control equipment, a $2.6 billion U.S. market, is primarily used in industrial applications for the control or regulation of power utilization apparatus, including motors.

This index represents monthly sales information collected by NEMA from its members, the major industrial control manufacturers in the U.S. market. Detailed information is only available to NEMA members. The data underlying these indices represent more than 90 percent of U.S. sales of this equipment. For more information, contact Walt Kozikowski, industry director, at (703) 841-3262 or visit the NEMA website at

NEMA is the leading trade association in the United States representing the interests of electroindustry manufacturers.