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AEM releases annual outlook report

Dec. 16, 2010 –The Association of Equipment Manufacturers (AEM) is predicting modest upticks in business through 2013 in the organization’s just-released construction equipment business outlook survey. Canadian business overall is expected to be 8.2 percent higher in 2010 than the previous year, and record gains of 12.0 percent in 2011, 14.8 percent in 2012 and 12.7 percent in 2013.


December 16, 2010
By Carey Fredericks

Dec. 16, 2010 –The Association of Equipment Manufacturers (AEM) is
predicting modest upticks in business through 2013 in the
organization’s just-released construction equipment business outlook
survey. Canadian business overall is expected to be 8.2 percent higher
in 2010
than the previous year, and record gains of 12.0 percent in 2011, 14.8
percent in 2012 and 12.7 percent in 2013.

Construction machinery manufacturers predict overall business in the
United States to close out 2010 with 6.4-percent growth, then gain 12.7
percent in 2011 and 14.8 percent in 2012, followed by 2013 growth of
13.0 percent. Industry business to the rest of the world is anticipated to be
strongest in 2010  – up by 14.7 percent – and then grow 11.8 percent in
2011, 12.5 percent in 2012 and 11.2 percent in 2013.

The Association of Equipment Manufacturers (AEM) is
predicting modest upticks in business through 2013 in the organization’s
just-released construction equipment business outlook survey.

– Canadian business overall is expected to be 8.2 percent higher in 2010
than the previous year, and record gains of 12.0 percent in 2011, 14.8
percent in 2012 and 12.7 percent in 2013.
– Construction machinery manufacturers predict overall business in the
United States to close out 2010 with 6.4-percent growth, then gain 12.7
percent in 2011 and 14.8 percent in 2012, followed by 2013 growth of
13.0 percent.
– Industry business to the rest of the world is anticipated to be
strongest in 2010  – up by 14.7 percent – and then grow 11.8 percent in
2011, 12.5 percent in 2012 and 11.2 percent in 2013.

"While this rebound is welcome, you have to remember our industry was
down 30 to 50 percent in the recession, so there is a long way to go.
Although business is improving, it will take years to recover the sales
losses of 2008-2009," stated AEM President Dennis Slater.
"This hopeful
outlook will be difficult to achieve without action now on
transportation infrastructure legislation and export-promotion policies.
Infrastructure investment and export agreements are proven ways to
create and maintain jobs for U.S. workers, for a sustainable recovery
and meaningful uptick in equipment demand," Slater said.



AEM is the North American-based international trade group representing
the off-road equipment manufacturing industry. Each business-activity
forecast is the average of responses from manufacturers in each product
line, predicting industry-wide expectations rather than individual
company performance, and unit sales rather than company profitability.
Full survey results can be found here.

The survey asked respondents to rank how several factors would influence
sales. Not surprisingly, a key impediment to growth in the construction
equipment industry is the stagnant housing market. The general economy,
including credit availability, also continues to be a major factor, as
is highway funding. The brightest spot is increased export demand.



"The housing market is still very weak, stimulus-funded projects are
nearing an end, and state and local budgets continue to shrink.
Unemployment in the manufacturing sector remains stubbornly high. In
construction, unemployment is still about double the national average;
for example, construction unemployment was 18.8 percent for November
2010," Slater noted.
"Congress and the Administration need to put
bipartisan differences aside and finally pass a long-term federal
transportation funding bill. Repairing the infrastructure will improve
U.S. competitiveness globally by providing a more efficient, safer and
reliable system to move U.S. goods to market. Export sales have helped
many U.S. manufacturers keep their doors open, and thus able to provide
American jobs and support American communities. Eliminating trade
barriers that prevent American manufacturers from selling their products
in new markets is vital for a healthy and growing economy. The recent
U.S.-Korea export-promotion agreement is an encouraging sign, and we
urge Congress to take swift action to enact this policy as well as pass
the export-promotion agreements still pending with Colombia and Panama.
The Administration and Congress need to truly focus on national policies
that keep manufacturing strong, policies that create the certainty
manufacturers need to invest and hire. A robust American manufacturing
sector is necessary so our economy can compete with other countries and
our equipment manufacturers are able to prosper and grow right here in
the United States. Until these things are done, America's economy will
suffer and our competitive position in the world will be threatened."