The economic outlook remains muddled due to concerns about inflation and lower production overall in multiple industries muting short-term growth and in 2025.
Industry-leading economic firm ITR Economics provides heavy-duty equipment market trends to help OEMs stay up to date on top industry information and insights, which can help them make better decisions in 2024.
The latest data reveals horizontal trends and a sluggish upturn for industrial activity in the United States for 2025. Decline is expected in industries such as construction machinery as economic and geopolitical headwinds continue to be a factor. Much is the same in Europe, which is dealing with the war in Ukraine and Euro inflation.
The following provides a summary of key observations across 13 indicators and areas of industry that contribute to today's global economic conditions.
NOTE: All data for charts are supplied by ITR Economics.
U.S. OECD Leading Indicator
The monthly rate-of-change for the U.S. OECD Leading Indicator is trending horizontally.
Prior rise and the current plateau in the Indicator rate-of-change suggest a sluggish upturn for industrial activity in 2025.
U.S. OECD Leading IndicatorITR Economics
Four Big European Nations Leading Indicator
The Four Big European Nations Leading Indicator monthly rate-of-change moved horizontally in September.
Inflation of the Euro has dropped below the European Central Bank target of 2.0%, reflecting tepid economic growth outlook in the Eurozone.
Four Big European Nations Leading IndicatorITR Economics
U.S. Construction Machinery New Orders
Annual U.S. Construction Machinery New Orders ticked down to $51.1 billion in August, 5.7% above the year-ago level.
Further decline is likely ahead. Prior rise in the leading residential construction sector, government spending on infrastructure, and inflationary pressures will keep New Orders from contracting significantly.
U.S. Construction Machinery New OrdersITR Economics
U.S. Mining and Oil Field Machinery Production Index
U.S. Mining and Oil Field Machinery Production in the 12 months through September was 5.5% below the year-ago level. Given recent Federal Reserve messaging, buyers will likely wait for lower interest rates, so further decline is likely in at least the near term.
A combination of upcoming lower rates and expected improvement in macroeconomic data as 2025 progresses will likely lead the next recovery trend.
U.S. Mining and Oil Field Machinery Production IndexITR Economics
U.S. Industrial Production
U.S. Industrial Production in the third quarter was 0.3% below the third quarter of 2023.
Mixed leading indicator evidence suggests muted rise in 2025. A mild rate-of-growth environment will mean less-forgiving circumstances than prior, more robust cycles.
U.S. Industrial ProductionITR Economics
U.S. Farm Machinery Shipments
U.S. Farm Machinery Shipments in the 12 months through August were virtually even with the year-ago level.
U.S. Farm Proprietors Income suggests lingering downside pressure on the farm machinery market.
U.S. Farm Machinery ShipmentsITR Economics
U.S. Heavy-Duty Truck Production
Annual U.S. Heavy-Duty Truck Production in September was 0.1% below the year-ago level.
Prior decline in freight volumes and pricing suggest downside pressure on truck demand. Stabilizing Trucking Revenue suggests that decline will be mild.
U.S. Heavy-Duty Truck ProductionITR Economics
U.S. Defense Capital Goods New Orders
Annual U.S. Defense Capital Goods New Orders in August rose and were 1.2% below the year-ago level.
Geopolitical risks are generally increasing given ongoing developments in the Middle East and Ukraine conflicts. New Orders will likely continue to rise.
U.S. Defense Capital Goods New OrdersITR Economics
U.S. Private Nonresidential Construction
Quarterly U.S. Private Nonresidential Construction rose to $190.0 billion in August, 4.4% above the year-ago level.
The lagged downside effect of high rates and macroeconomic softness in 2024 will push down on many nonresidential construction markets in 2025.
U.S. Private Nonresidential ConstructionITR Economics
U.S. Total Public Construction
Annual U.S. Total Public Construction in August totaled $481.2 billion, 13.3% above the year-ago level. Construction is in a slowing growth trend.
Construction will likely avoid contraction for at least the coming year, given already-allocated government funds.
U.S. Total Public ConstructionITR Economics
U.S. Mining Production
Annual U.S. Mining Production in the 12 months through September was 0.3% below the year-ago level.
Mining Production is declining. However, we expect that rise in the industrial and retail sectors will contribute to recovering materials demand, and thus mining, in 2025.
U.S. Mining ProductionITR Economics
Germany Industrial Production
Germany Industrial Production in the three months through August was 4.4% below the year-ago level.
Leading indicators, such as Markit Economics’ Germany Purchasing Managers Index, suggest that business cycle rise is forthcoming for Germany Industrial Production; however, business confidence remains weak given troubles in the automotive industry and geopolitical uncertainty.
Germany Industrial ProductionITR Economics
Europe Agricultural and Forestry Machinery Production
Europe Agricultural and Forestry Machinery Production in the 12 months through August was 17.5% below the year-ago level.
The European Central Bank lowered interest rates in September by 0.25 percentage points. The key deposit facility rate is now down to 3.25%. Lowered rates may help improve machinery demand in the coming quarters.
Europe Agricultural and Forestry Machinery ProductionITR Economics
