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AEM survey reinforces industry turn around
Construction equipment manufacturers expect overall industry business to turn around slightly in 2010 following double-digit expected year-end 2009 declines in the minus 40 percent range for the United States and minus 30 percent range for Canada and other worldwide sectors, according to the annual "outlook" survey of the Association of Equipment Manufacturers (AEM). Survey respondents then anticipate stronger growth going into 2011, but not enough to erase the severe 2009 business and job losses. Business in 2012 is then expected to level off.
Construction machinery business in the United States was predicted to end 2009 with a 43 percent overall drop and then increase 5 percent in 2010, followed by gains of 15 percent in 2011 and 14 percent in 2012.
For Canada, 2009 business was anticipated to decrease 34 percent overall with a 2010 increase of 7 percent, 14 percent increase in 2011 and 11 percent increase in 2012. Industry business to the rest of the world was expected to close out 2009 with losses of 34 percent, followed by a 2010 gain of 7 percent and growth of 13 percent in 2011 and again in 2012.
AEM President Dennis Slater said: "Global business will be a key to our industry's turnaround, and we need policies that enhance our competitiveness in world markets. For example, we still have pending free-trade agreements (FTAs) with South Korea, Panama and Colombia. These agreements would help open overseas markets to U.S. exporters and investors.
"In contrast to the U.S., the European Union is joining East Asian and Latin American countries in negotiating dozens of FTAs. Our failure to pursue FTAs could very well cost U.S. manufacturers much needed competitive advantages by keeping the playing field tilted in favor of our competitors.
"Emerging markets in the past have been very positive for construction equipment sales. Markets to look at continue to include China and India. These countries are committed to building up their infrastructure to compete on the world stage. For example, in recent years China has invested 9 percent of its GDP for infrastructure, compared to the U.S. total of 0.93 percent investment of GDP. "
The full survey results are online at www.aem.org in the Industry Trends section.