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Material-handling equipment new orders grew 7.0 percent in 2013 and are forecast to grow 8.5 percent or more in 2014, according to a recent analysis.

Even better, orders are expected to grow 12.0 percent in 2015, according to the latest Material Handling Equipment Manufacturing Forecast (MHEM), released by MHI, an international trade association which represents the greater material handling and logistics industry.

“We are optimistic about future outcomes and expect economic fundamentals to favorably support MHEM expansion through 2014 and 2015,” says Hal Vandiver, MHI executive consultant.

In addition, material-handling equipment shipments grew 7.4 percent in 2013, and are forecasted to grow 6.7 percent in 2014 and 10.7 percent in 2015.

Domestic demand also sustained growth. It grew 7.9 percent in 2013 and is forecasted to grow just over 7.0 percent in 2014 and 10.0 percent in 2015.

George W. Prest, CEO of MHI, attributes the growth to the ongoing economic recovery. Consequently, “the fundamentals for solid growth in the U.S. economy are in place for 2014 and 2015,” he says.

“The recovery is gaining momentum and this can be seen in the manufacturing and supply chain industries,” Prest says in an email to Leo Rommel of Industry Today. “Material handling equipment and systems purchases derive from the need for firms to anticipate and match changes in demand to yield improvements in efficiency, throughput, and visibility.”

Prest adds: “Businesses are now well positioned to make these investments. Firms have low debt, are profitable and have relatively high utilization rates.”

Although “the overall signs are positive, there are concerns that have the potential to slow growth,” Prest says. These include:

  • Uncertainty created by Washington, D.C.;
  • Stagnant wage growth;
  • Ongoing high unemployment;
  • Supply chain workforce shortage;
  • The impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act on small business;
  • Higher payroll and Affordable Care Act taxes.

Import growth in 2013, meanwhile, was 3.0 percent, down from 17.9 percent in 2012. Export growth was flat in 2013, down from 11.2 percent in 2012.

MHEM Imports and Exports are expected to rebound modestly beginning in mid-2014 and continue to grow in 2015, MHI says in its analysis.

The MHEM forecast of material handling equipment manufacturing is released each quarter by MHI and looks 12 to 18 months forward to anticipate changes in the material handling and logistics marketplace.

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