US Indicators Grow; Europe’s Decrease Further

Indicators in several markets show that while growth is still slow, several areas are seeing improvement. Annual U.S. construction machinery new orders and U.S. heavy-duty truck production are higher than a year ago.

With inflation threatening and oil and gas prices well above normal, growth in the U.S. will be slow for most of 2022. Europe’s markets continue to be down because of many factors, including the ongoing War in Ukraine.      

READ MORE: Third Quarter 2021 Continues to Show Strong Market Demand

View the corresponding Equipment Market Outlook charts for more data

NOTE: All data for charts supplied by ITR Economics

Europe Agriculture and Forestry Machinery Production [return to nav]

    • Europe agricultural and forestry machinery production came in 5% above the year-ago level in April.
    • ITR Checking Points™ signal production will continue to soften in the coming quarters.

    Europe Agriculture Machinery Production

    China Diesel Bus Production [return to nav]

      • China large diesel bus production in the 12 months through April moved sharply lower but came in 4.3% above the year-ago level.
      • COVID-19 restrictions—though easing—and weak economic growth in China are warning signs for the future direction of production.

      China Large Diesel Bus Production

      U.S. Industrial Production [return to nav]
      • Quarterly average U.S. industrial production in May was up 5.5% from the year-ago level; growth is generally slowing.
      • Leading Indicators signal business-cycle decline is likely to be the predominant trend for production for at least the remainder of 2022.

      Us Industrial Production

      U.S. OECD Leading Indicator [return to nav]

        • The U.S. OECD leading indicator raw data and monthly rate-of-change were both virtually flat in May.
        • General decline in the monthly rate-of-change signals that the U.S. industrial sector annual growth rate will move lower into at least early 2023.

        Us Leading Indindicator

        U.S. Private Nonresidential New Construction [return to nav]
        • In the three months through April, U.S. private nonresidential construction came in 10.3% above the year-ago level.
        • Trends within private nonresidential construction vary, with sectors such as office and education trending below year-ago levels, and sectors such as warehousing and manufacturing offering areas of relative opportunity.

        Us Private Nonresidential New

        U.S. Construction Machinery, New Orders [return to nav]
        • Annual U.S. construction machinery new orders in April totaled $38.9 billion, up 16.1% from the year-ago level; growth is slowing.
        • A cooling housing market, slowing macroeconomic growth and anticipated easing inflation beginning late this year will contribute to ongoing slowing growth in new orders in at least the coming quarters. 

        Us Construction Machinery New Orders

        U.S. Farm Machinery Production [return to nav]
        • U.S. farm machinery and equipment shipments in the 12 months through April came in 0.3% below the year-ago level.
        • War in the breadbasket of Europe has placed upward pressure on food prices, potentially incentivizing more agricultural production in the U.S. However, supply chain disruptions are hindering growth in the agricultural machinery space.

        Us Farm Machinery

        U.S. Total Public New Construction [return to nav]
        • Annual U.S. public new construction is rising but was 2.1% below the year-ago level in April.
        • High tax receipts at the federal, state and local levels bode well for construction rise into next year.

        Us Total Public New Construction

        North American Rotary Rig Count [return to nav]
        • The annual North American rotary rig count in May averaged 745 rigs, 73% above the year-ago level.
        • High oil and gas prices signal robust demand for drilling, but supply chain disruptions—especially shortages of materials and equipment—are posing challenges for oil and gas firms. 

        North American Rotary Rig Count

        U.S. Defense Industry, New Orders [return to nav]
        • U.S. defense capital goods new orders in the 12 months through April came in 3.1% below the year-ago level.
        • Trends in U.S. federal government current tax receipts suggest that the nascent annual new orders rise is likely to persist, though the U.S. withdrawal from Afghanistan still suggests a downside risk.

        Us Defense Capital

        U.S. Heavy-Duty Truck Production [return to nav]
        • Annual U.S. heavy-duty truck production in May came in 4.7% above the year-ago level.
        • Expect growth but at a generally slower pace as improvement in the supply chain allows more trucks to be produced while waning macroeconomic momentum reduces the pressure to upgrade trucking fleets.

        Us Heavy Duty Trucks

        Europe Leading Indicator [return to nav]

          • The Europe leading indicator raw data and monthly rate-of-change moved lower in May.
          • Persistent business cycle decline in the leading indicator rate-of-change signals decline for the Europe industrial production annual growth rate into at least early 2023. 

          Europe Leading Indicator

          Germany Industrial Production [return to nav]
          • Quarterly Germany industrial production in April came in 2.5% below the year-ago level.
          • German leading indicators signal production will continue to trend on the back side of the business cycle (slowing growth or recession) during at least the next few quarters.      

          Germany Industrial Production