North American Tooling Industry Increases Utilization, Revenue in 2021April 8, 2022
Harbour Results, Inc. (HRI), Southfield, MI, has released the results of its Q1 2022 Harbour IQ Manufacturing Pulse Study, indicating that the tooling industry rebounded in 2021 with companies on average seeing year-over-year revenue growth of 10 percent. Additionally, mold and die shops saw utilization range between 81 and 89 percent throughout 2021 and, although Q1 2022 has started out slightly slower, shops forecast utilization to reach 90 percent (mold) and 82 percent (die) by Q4 2022.
The study also finds that the higher cost of business and access to labor remain top concerns. And for the tooling industry, work-on-hold is trending up while payment terms and on-time payments of accounts have dropped after a brief improvement in 2021.
“Despite all of the chaos in the manufacturing marketplace, we feel positive about the opportunities for the tool and die industry in 2022,” says HRI president and CEO Laurie Harbour. “According to our automotive-tooling launch analysis, we predict the North American automotive-tooling spend to be $7 billion in 2022, up from $5.4 billion in 2021. This increase in vehicle launches will positively impact the industry.”
Last year, die and mold businesses saw significant efficiency improvements, the study also reveals, although average profitability only ticked up slightly from 2.9 percent in 2020 to 3.6 percent in 2021. This suggests that the efficiency improvements may be a result of the talent shortage, or the increased cost associated with outsourcing and overtime. Furthermore, the study indicates that shops expect to invest between 4 and 5 percent of revenue in capital expenditures in 2022.