Not just spinning their wheels
Machine tool dealers see rising sales

by Rick Barrett, Milwaukee Journal-Sentinel

The business climate was grim when Thomas Tank attended the Wisconsin Manufacturing and Machine Tool Expo less than a month after the Sept. 11, 2001, terrorist attacks.

Even before 9-11 and the economic downturn that followed, the outlook for machine tool sales was uncertain.

"Nobody knew where this industry was going," Tank recalled.

The industry went off a cliff, with U.S. machine tool sales falling from $10 billion in 1999 to less than $4 billion in 2003. Hammered by the economy, many tool dealers went out of business.

"That was right about when I started," Tank said of his company, Progressive Machinery Inc.

This week, Tank is back at the ninth annual Manufacturing and Machine Tool Expo, which continues today and Thursday at State Fair Park. The mood is more upbeat than it was four years ago, and Tank predicts strong sales through the end of 2005.

National sales of machine tools, which are used in factories to make everything from automobiles to appliances, were $250 million in July - up 24% from a year earlier, according to the latest figures from the American Machine Tool Distributors' Association.

From January through July, the United States had $1.7 billion in machine tool sales, up nearly 15% from the same seven months in 2004. The strongest sales were in the Midwest, where companies spent $85.9 million on equipment in July, up 17% from a year earlier. Some of the weakest sales were in the Northeast, where tool purchases fell 15% to about $27 million.

The monthly figures could be skewed by large orders, but there are several factors driving a rebound in machine tool sales, industry executives said.

First, higher profits have allowed manufacturers to invest more in capital equipment.

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