North American Metalworking in April: A Challenging Environment
Apr 23, 2007
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During the next 3 months, North American metalforming companies expect the current challenging environment to continue, according to the most recent Precision Metalforming Association (PMA) Business Conditions Report. The monthly report is an economic indicator for manufacturing, sampling 158 metalforming companies in the U.S. and Canada.

"Expectations for new orders reported in PMA's April Business Conditions Report continued a downward trend," noted William E. Gaskin, PMA president. "However, members also reported a sharp uptick in their anticipated shipments in April compared to March, which is inconsistent with last month's report. Metalforming companies are experiencing a very challenging environment, as customers constantly adjust their requirements for metal parts and assemblies to avoid excess inventories should the economy stumble more severely than anticipated. There is continued uncertainty in the automotive, housing and appliance markets that will make profitability in 2007 a challenge for many companies."

When asked what they expect the trend in general economic activity to be over the next 3 months, only 25 percent of participants reported that conditions will improve (down from 28 percent in March), 56 percent predict activity will remain the same (compared to 57 percent the previous month) and 19 percent anticipate a decline in business conditions (up from 15 percent in March).

Metalforming companies also forecast a downward trend in incoming orders during the next three months. Thirty-four percent of respondents predict an increase in orders (down from 40 percent in March), 46 percent expect no change (compared to 41 percent last month) and 20 percent anticipate a decrease in orders (up from 19 percent in March).

The number of metalforming companies with a portion of their workforce on short time or layoff worsened in April, as 20 percent reported having workers on short time or layoff, compared to 16 percent in March.

However, current average daily shipping levels compared to the past 3 months improved in April. Forty percent of companies reported that shipping levels are above levels of 3 months ago (up from 35 percent in March), 40 percent reported no change (compared to 37 percent in March) and only 20 percent reported that April shipping levels are below levels of 3 months ago (compared to 28 percent the previous month).

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