This is article is part of a series of monthly articles produced by Harbour Results for PMA’s MetalForming Business Edge e-newsletter. Click here to view the full collection of articles.

Sneek Peek at the Numbers

The inaugural survey from PMA’s new industry intelligence tool – Metalforming Insights, powered by Harbour Results and Plante Moran – is complete, currently being analyzed and custom outputs being created. And we are excited to share some preliminary results.

The Q1 Financial Survey results represent data from 92 facilities with 75% of respondents being metal stampers and 94% from the U.S.  Automotive remains the top industry served (58%) followed by heavy truck (28%) and industrial machine (22%).

Overall, the industry is optimistic for the year ahead as average sentiment or the general outlook for the year rebounds from pessimistic during the peak of the COVID pandemic to neutral and even optimistic in Q1 2021. Although not back to peak optimism levels in 2016/2017, it does show marked improvement.

Additionally, utilization continues to rise from an industry low of 39% in Q2 2020 to 57% in Q1 2021 with a forecast of 60% by the end of the year. This utilization forecast is on par with the plastics molding industry, but a step below the die building industry (forecast 83% utilization in Q4 2021).

As expected, average profitability declined across the industry in 2020 except for metalformers with revenue ranging from $7.5 – 15 million due to lower labor as a portion of value-add. And the industry expects to invest slightly more in capital spending as a percent of revenue (3% to 4%) this year.

Also, not surprising based on the current state of the manufacturing supply chain, the top concerns of those surveyed are raw material pricing, raw material availability and access to labor. These issues are a direct result of the pandemic and will continue to challenge the metalforming industry

Yes, the industry had a tough year in 2020 with COVID. However, the study indicated that performance numbers – efficiency, profitability, etc. - were trending down in advance of the pandemic. And, although much of the data shared here today is positive, we caution the industry. There are many challenging factors to face in 2021 and it will be critically important that companies remain flexible and focus on improving efficiency to be cost-competitive.

Data… Data… Data…

Those PMA members who participated in the Metal Forming Insights - Q1 Financial Study will be receiving a custom analysis in April. Additionally, PMA is hosting a webinar on Wednesday, May 26 from 2-3 p.m. (EST) where HRI’s manufacturing expert, Jason Brewer, and Plante Moran’s Dave Andrea will provide a detailed look at the analysis as well as provide information on what businesses should focus on in the near- and long-term. More information on the webinar will be available on PMA’s website soon.

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About the authors: 

Jason C. Brewer, a Director at Harbour Results, helps clients drive profitable growth through strategic direction and matching their operations to the strategy.  He has extensive experience consulting and working within metals manufacturing companies in roles from engineering to sales to executive team management.