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Researched by Industrial Info Resources (Sugar Land, Texas)--Manufacturing activity in the U.S. is at its lowest level since May 2020, according to a survey by the Institute for Supply Management (ISM). The survey respondents noted conditions pointing to softening demand that could continue into the future. Despite this and other challenges that could impact capital spending in the industry, Industrial Info's project data shows U.S. manufacturing project activity remains robust.
Industrial Info is tracking more than $250 billion worth of U.S. projects that are under construction, and $180.7 billion worth that are expected to kick off in 2023.
The ISM's October Purchasing Managers Index (PMI), which tracks 18 industry sectors in the U.S, registered 50.2%--down from 50.9% in September and 52.8% in August and July, according to Timothy Fiore, chair of the ISM's Manufacturing Business Survey Committee. New order rates remain in contraction territory; new export orders are showing a faster rate of contraction; inventories remain at a low level; and order backlogs slipped into contraction.
"The U.S. manufacturing sector continues to expand, but at the lowest rate since the coronavirus pandemic recovery began. With panelists reporting softening new order rates over the previous five months, the October index reading reflects companies' preparing for potential future lower demand," Fiore said.
Further, results from the National Association of Manufacturers' (NAM) latest quarterly membership survey show respondents expect capital spending to rise only 2.2% through a 12-month period ending September 2023--the lowest rate since the fourth quarter of 2020; David Pickering, Industrial Info's vice president of research for the industry, was "not particularly surprised" by the results. For more information, see Industrial Info's September 21, 2022, article - Manufacturer Survey: Slowest Capex Growth Expected Since 2020.
Despite the bleak outlook, Industrial Info's North American Construction Starts Index shows project activity in the U.S. Industrial Manufacturing Industry is on an upswing. The monthly index for September 2022 indicated 2,351 construction starts, with a project value of $109.3 billion--up more than 30% year over year--and an increase from 2,157 construction starts, with a project value of $87.5 billion, in July.
According to Pickering, the semiconductor and automotive sectors are driving spending primarily: "The passage of the CHIPS Act and the semiconductor shortage, that has been well published for the last two years, is driving semiconductor spending as it is a massive reshoring effort and one of national security. On the automotive front, the conversion to electric vehicles, which is approaching rapidly, is pushing spending along those lines across North America."
Two major semiconductor manufacturing plants are under construction in Arizona: Intel Corporation's (NASDAQ:INTC) (Santa Clara, California) $30 billion expansion at its Ocotillo semiconductor manufacturing campus in Chandler, Arizona, and Taiwan Semiconductor Manufacturing Company Limited's (TSMC) (Hsinchu, Taiwan) $12 billion chip fabrication facility in Phoenix, Arizona. Both projects are expected to be completed in second-half 2023. Subscribers can see detailed reports for the Intel and TSMC projects. For more information on efforts to boost domestic semiconductor manufacturing, and Intel's project activity, see September 12, 2022, article - Biden Announces Plan for CHIPS Act Semiconductor Funding.
Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can click here for a detailed list of U.S. manufacturing projects under construction.
Among the U.S. manufacturing projects expected to kick off next year are construction of the $5 billion Jasper Ocean Terminal, a joint venture between the Georgia Ports Authority (GPA) and Jasper County, South Carolina (Jasper County City Council), to be built along the Savannah River. The container terminal will be 13 miles closer to the Atlantic Ocean than the GPA's Port of Savannah and feature a capacity of 7 million twenty-foot equivalent units (TEUs). Construction is aimed to begin at the end of the year. Click here for the project report.
While the GPA recently reported handling more than 1.5 million TEUs of cargo at the Savannah port in the first quarter of fiscal 2023 (July through September), a 9.6% increase year over year, port executives anticipate a dip in cargo activity due to headwinds. In a related press release, GPA Executive Director Griff Lynch noted: "we are beginning to see signs of correction in the market." Board Chairman Joel Wooten added, "We're expecting a gradual easing in demand based on several factors, including a shift in the balance of consumer spending away from goods and back to services, and the impact of inflation on the economy."
However, that hasn't prevented projects to support the U.S.' energy transition and its push toward electric vehicles (EVs) from moving forward. Among them are Hyundai Motor Company's (South Korea) $5.5 billion electric vehicle and battery assembly plant in Ellabell, Georgia. The project involves constructing 11 buildings featuring up to 17 million square feet of space with a production capacity of 300,000 EVs per year, and installing equipment to produce EV batteries. General Motors Company (NYSE:GM) (Detroit, Michigan) is anticipating kicking off a $4 billion battery pack assembly line expansion at its 4.3 million-square-foot plant in Lake Orion, Michigan, to manufacture battery cells, modules, and packs for models such as the electric GMC Hummer pickup. Both projects are expected to kick off in the first quarter. Subscribers can see reports for the Hyundai and GM projects.
The GMI Project Database shows $180.7 billion worth of manufacturing projects are expected to kick off in 2023. Subscribers can click here for a list.
Click here for a look at all of the projects discussed in this article, and here for the plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Industrial Info is tracking more than $250 billion worth of U.S. projects that are under construction, and $180.7 billion worth that are expected to kick off in 2023.
The ISM's October Purchasing Managers Index (PMI), which tracks 18 industry sectors in the U.S, registered 50.2%--down from 50.9% in September and 52.8% in August and July, according to Timothy Fiore, chair of the ISM's Manufacturing Business Survey Committee. New order rates remain in contraction territory; new export orders are showing a faster rate of contraction; inventories remain at a low level; and order backlogs slipped into contraction.
"The U.S. manufacturing sector continues to expand, but at the lowest rate since the coronavirus pandemic recovery began. With panelists reporting softening new order rates over the previous five months, the October index reading reflects companies' preparing for potential future lower demand," Fiore said.
Further, results from the National Association of Manufacturers' (NAM) latest quarterly membership survey show respondents expect capital spending to rise only 2.2% through a 12-month period ending September 2023--the lowest rate since the fourth quarter of 2020; David Pickering, Industrial Info's vice president of research for the industry, was "not particularly surprised" by the results. For more information, see Industrial Info's September 21, 2022, article - Manufacturer Survey: Slowest Capex Growth Expected Since 2020.
Despite the bleak outlook, Industrial Info's North American Construction Starts Index shows project activity in the U.S. Industrial Manufacturing Industry is on an upswing. The monthly index for September 2022 indicated 2,351 construction starts, with a project value of $109.3 billion--up more than 30% year over year--and an increase from 2,157 construction starts, with a project value of $87.5 billion, in July.
According to Pickering, the semiconductor and automotive sectors are driving spending primarily: "The passage of the CHIPS Act and the semiconductor shortage, that has been well published for the last two years, is driving semiconductor spending as it is a massive reshoring effort and one of national security. On the automotive front, the conversion to electric vehicles, which is approaching rapidly, is pushing spending along those lines across North America."
Two major semiconductor manufacturing plants are under construction in Arizona: Intel Corporation's (NASDAQ:INTC) (Santa Clara, California) $30 billion expansion at its Ocotillo semiconductor manufacturing campus in Chandler, Arizona, and Taiwan Semiconductor Manufacturing Company Limited's (TSMC) (Hsinchu, Taiwan) $12 billion chip fabrication facility in Phoenix, Arizona. Both projects are expected to be completed in second-half 2023. Subscribers can see detailed reports for the Intel and TSMC projects. For more information on efforts to boost domestic semiconductor manufacturing, and Intel's project activity, see September 12, 2022, article - Biden Announces Plan for CHIPS Act Semiconductor Funding.
Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can click here for a detailed list of U.S. manufacturing projects under construction.
Among the U.S. manufacturing projects expected to kick off next year are construction of the $5 billion Jasper Ocean Terminal, a joint venture between the Georgia Ports Authority (GPA) and Jasper County, South Carolina (Jasper County City Council), to be built along the Savannah River. The container terminal will be 13 miles closer to the Atlantic Ocean than the GPA's Port of Savannah and feature a capacity of 7 million twenty-foot equivalent units (TEUs). Construction is aimed to begin at the end of the year. Click here for the project report.
While the GPA recently reported handling more than 1.5 million TEUs of cargo at the Savannah port in the first quarter of fiscal 2023 (July through September), a 9.6% increase year over year, port executives anticipate a dip in cargo activity due to headwinds. In a related press release, GPA Executive Director Griff Lynch noted: "we are beginning to see signs of correction in the market." Board Chairman Joel Wooten added, "We're expecting a gradual easing in demand based on several factors, including a shift in the balance of consumer spending away from goods and back to services, and the impact of inflation on the economy."
However, that hasn't prevented projects to support the U.S.' energy transition and its push toward electric vehicles (EVs) from moving forward. Among them are Hyundai Motor Company's (South Korea) $5.5 billion electric vehicle and battery assembly plant in Ellabell, Georgia. The project involves constructing 11 buildings featuring up to 17 million square feet of space with a production capacity of 300,000 EVs per year, and installing equipment to produce EV batteries. General Motors Company (NYSE:GM) (Detroit, Michigan) is anticipating kicking off a $4 billion battery pack assembly line expansion at its 4.3 million-square-foot plant in Lake Orion, Michigan, to manufacture battery cells, modules, and packs for models such as the electric GMC Hummer pickup. Both projects are expected to kick off in the first quarter. Subscribers can see reports for the Hyundai and GM projects.
The GMI Project Database shows $180.7 billion worth of manufacturing projects are expected to kick off in 2023. Subscribers can click here for a list.
Click here for a look at all of the projects discussed in this article, and here for the plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
