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.
"People are starting to take a longer-term view on capital projects now," said Tom Doyle, president of QComp Technologies Inc., a Greenville company that introduced a driverless forklift that works with robot-based manufacturing systems.
Second, some companies are buying new factory machines so they don't miss a federal tax break to write off half the cost in the first year. With other tax incentives, the savings could be even higher for some small and mid-size businesses.
"The last fiscal quarter in this industry is always strong" because companies want to spend cash rather than pay taxes on it, Tank said.
The trade show covers nearly 200,000 square feet of exhibit space and includes some novelty items such as a Fanuc "casino robot" from Ellison Machinery & Robotics that plays craps.
Prices of industrial robots have dropped as the machines have become more common.
"For about $30,000, you can get a robot to load and unload parts," Tank said. "And some robots now have 'vision,' which allows them to take a picture of a part and find it."
QComp Technologies' driverless forklift, which is not at the show, can eliminate the use of pallet conveyors, reduce labor costs and avoid product damage. It can be navigated using routes downloaded through a wireless computer system, can travel 230 feet per minute and can lift 2,000 pounds.
"We have the first one running around on our plant floor now," Doyle said.