The MHEDA Journal - First Quarter, 2016 - (Page 65)
MHI Predicts Modest Slowdown
in Material Handling Equipment
Manufacturing in 2016
BY GEORGE PREST, CEO, MHI
fter experiencing near historic highs in 2015 for Material
Handling Equipment Manufacturing (MHEM), MHI
predicts a modest slowdown in U.S. material handling
equipment manufacturing in 2016.
MHEM orders are expected to be
$31.1 billion in 2015, but fall in 2016 by
11.3 percent to 27.6 billion. Domestic
Demand is expected to be 30.7 billion
in 2015, although it is expected to fall
in 2016 by 3.6%.
A strong U.S. equity market, low
interest rates and continued manufacturing expansion are supportive
of continued domestic new orders.
However, a strong dollar and expected
increases in interest rates are likely to
In light of sluggish global growth
and a relatively strong dollar in 2015,
domestic material handling firms may
face some challenges in coming quarters. The risk of a broader domestic
manufacturing slowdown is high, as is
the risk of the slowdown moving to the
now-relatively strong service sector.
This means that MHEM domestic demand is likely to fall modestly
in 2016, although new orders could
fall more dramatically due to soft
exports and an overall slowdown in
Overseas, the outlook for material
handling is likely to improve modestly
on the back of stimulative monetary
policies, although the strong dollar
could prevent a significant increase
in U.S. exports that would otherwise
capture rising sales in that market.
The most important economic data
with forward-looking implications
for material handling are the ISM
Manufacturing Index, the ISM NonManufacturing Index and the new
MHI Business Activity Index (BAI).
The MHI BAI captures changes in material handling business dynamics on a
monthly basis including capacity utilization, new orders, shipments, unfilled
orders, inventories, exports and future
In light of changing market dynamics, these data releases remain critical
for gauging the near-term outlook for
the U.S. economy and material handling. The ISM Manufacturing Index
and the MHI BAI are released at the
beginning of each month.
At the same time that the outlook
for the U.S. economy has softened
in recent months, the outlook for the
global economy has remained modestly
positive in light of accommodative
monetary policy stimulus being implemented in the Eurozone and China.
In 2016, we expect improving
Eurozone growth as well as some modest improvements in Chinese manufacturing activity.
Trade Events are
MODEX 2016 will be presented in
Atlanta from April 4-7 at the Georgia
World Congress Center. This expo has
seen positive growth and will showcase
an expanded show floor of 250,000
square feet and 850 exhibitors.
We are also seeing great interest in
our exhibit space selection for ProMat
in 2017. Such activity signals not only
confidence in our industry, but also the
value MHI brings to our members and
the end user community.
You can learn more about MHI and
our programming at MHI.org.
George Prest is CEO of MHI, located in
Charlotte, North Carolina and on the
web at www.mhi.org
The MHEDA Journal | First Quar ter 2 016
Table of Contents for the Digital Edition of The MHEDA Journal - First Quarter, 2016
From the Desk of Liz Richards
MHEDA’S 2016 BOARD OF DIRECTORS AND MBOA
Ask Your Board
MHEDA University Calendar
MHEDA MEMBER PROFILE
WOMEN AT WORK
A POSITIVE 2016 IN STORE FOR MATERIAL HANDLING
Spotlight on Association News
Index of Advertisers by Product Category
The Last Word
The MHEDA Journal - First Quarter, 2016