Harbour Results Predicts 2019 North American Automotive Vendor Tooling Spend to be $8 Billion
Harbour Results, Inc. released the results of the Harbour IQ in-depth study on the current state of the automotive vendor tooling industry. The analysis predicts 2019 automotive vendor tooling spend to be $8 billion.
Harbour Results, Inc. released the results of the Harbour IQ in-depth study on the current state of the automotive vendor tooling industry. The analysis predicts 2019 automotive vendor tooling spend to be $8 billion.
The key factor driving decreased tooling spend is the decreased number of North American vehicle launches predicted between 2019 and 2021 (153 vehicles) versus the number of vehicles launched in North America between 2016-2018 (183 vehicles). Also, the Detroit Three automakers, who source most of their tools in this region, are forecasted to source only nine vehicles in 2019.
HRI anticipates that some of what was planned for 2018 will spill into 2019 to help level out the tooling spend for the next three year.
“The industry experienced a boom in 2017 with $10.3 billion in tooling spend and, based on the data, we expected 2018 to reach over $11 billion. However, due to a number of vehicle cancelations and delays, we are predicting the year to be closer to $9.2 billion,” Laurie Harbour, HRI president and CEO says. “The industry is $2.2 billion below forecast through first three quarters of 2018 resulting in a six-point dip in tooling shop utilization to 79 percent.”
HRI anticipates that some of what was planned for 2018 will spill into 2019 to help level out the tooling spend for the next three years. In addition to the 2019 forecast, Harbour IQ estimates future North American tooling spend to remain relatively stable with 2020 totaling $8.2 billion and 2021 at $9 billion.
“This forecast is based on current data and information, but issues like tariffs, automaker restructuring, and/or an economic recession could drastically impact the forecast resulting in a dip in tooling spend as much as $2 billion,” said Harbour.
Harbour IQ estimates future North American tooling spend to remain relatively stable with 2020 totaling $8.2 billion and 2021 at $9 billion.
“As the tooling market contracts, it is important that shops, specifically small shops that benefited from the increased outsourcing in 2017, prepare for the future. It is important that tool shops continue to focus on improving operations, smart investment in people and technology and strategic planning to remain competitive in the near and long term.”
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