Machine Tool Sales Return to “Normal” – Up 75% in December

According to USMTC, machine tool sales in December 2010 were 75.2% (units) and 113.8% (real dollars) more than in December 2009. Since January 2004, there have been only 11 months that have recorded higher unit sales than December 2010. Over the same time period, there have been only seven months that have recorded higher real dollar sales than December 2010. Given the sales of not just December but the last four months of 2010, it is fair to say that machine tool sales have returned to normal. In fact, orders for machine tools are so strong that deliveries are being pushed out. Machine tool components, such as ball screws and controllers, are in short supply, making it even more difficult for builders to meet demand. In 2010, machine tool sales were 61.1% higher than in 2009, almost certainly a record. I look for the peak annual growth rate to reach the low 70% range around the March-April time frame. Since machine tool sales are as strong as they have been in quite some time, I expect the annual growth rate to start slowing down after the first quarter of 2011. For more on machine tool sales and the leading indicators, go here.