Growth Expected for Material Handling Equipment

Hal Vandiver, executive vice president of business development for Material Handling Industry of America, delivered an economic outlook for the material handling sector at the recent ProMat 2011 Show Pro event in Atlanta. His assessment was a mix of optimism and caution. The key takeaways:

• Industrial production activity is increasing even though factory operating rates (utilization) remain very low by historical comparison.

• Demand created as the economy has shifted from recession into recovery mode (filling supply chain pipelines, re-establishing inventories, and responding to pent up demand) has been the principal impetus for improvement over the last few quarters in manufacturing, warehousing and distribution.

• Material Handling Equipment Manufacturers (MHEM) will benefit from improved consumer and investor confidence (economic stability, predictability), healthy corporate profits in the near term and expanding residential and non-residential building sectors in late 2012.

Specifically, while MHEM new orders are expected to grow about 18.0% in 2010, the outlook for 2011/1012 is for growth in the 11.0 to 12.0% range.

MHEM shipments will grow 6% to 7% for 2010, while the outlook for 2011/1012 is for growth in the 11.0 to 12.0% range.

MHEM domestic demand (shipments plus imports less exports)is expected to grow 3% to 4%% in 2010, while the outlook for 2011 is that it will likely mirror shipment growth in 2010. Exports will be stronger than imports in 2011. 2012 is open for debate, Vandiver concluded.

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