KPI – May 2024: Recent Vehicle Recalls
KPI – May 2024: State of Business – Automotive Industry
KPI – May 2024: State of Economy
KPI – May 2024: Consumer Trends
Economic activity in the manufacturing sector contracted in April after one month of expansion, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. The Manufacturing PMI® registered 49.2%, down 1.1 percentage points from 50.3% in March.
“The U.S. manufacturing sector dropped back into contraction after growing in March – the first time since September 2022 that the sector reported expansion. Although demand improvement slowed, output remains positive and inputs stayed accommodative,” says Timothy R. Fiore, CPSM, C.P.M., chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee.
Data shows demand is in the early stages of recovery, with steady signs of improvement. Production execution continued to expand in March, although at a slower rate of growth compared to prior months. Overall, Fiore says suppliers have capacity but are looking to improve lead times impacted by raw material supply chain disruptions.
“[Approximately] 34% of manufacturing gross domestic product (GDP) contracted in April, up from 30% in March,” Fiore says. “More importantly, the share of sector GDP registering a composite PMI® calculation at or below 45% – a good barometer of overall manufacturing weakness – was 4% in April, higher than the 1% figure in March, but an indication of better health than the 27% recorded in January.”
“Among the top six industries by contribution to manufacturing GDP in April, none had a PMI® at or below 45%,” he continues.
Caption: While the Ford F-series was the best-selling vehicle in April 2024, U.S. sales of America’s favorite truck decreased 11.38% year-to-date and 8.47% year-over-year.
Important Takeaways, Courtesy of the Manufacturing ISM® Report On Business®:
- Demand softening was reflected by the (1) New Orders Index dipping back into contraction, offset by fewer comments regarding softening; (2) New Export Orders Index indicating contraction after two months of expansion, offset by panelists’ more optimistic comments; (3) Backlog of Orders Index remaining in moderate contraction territory, rolling back slightly compared to March; and (4)
Customers’ Inventories Index at the “just right” level, neutral for future production.
- Output (measured by the Production and Employment indexes) moderated compared to March, with a combined 2.1-percentage point downward impact on the Manufacturing PMI® calculation. In April, panelists’ companies slightly increased their production levels month-over-month, while headcount reductions continued but showed signs of easing.
- Inputs – defined as supplier deliveries, inventories, prices and imports – continued to accommodate future demand growth.
- The Supplier Deliveries Index dropped marginally, continuing in ‘faster’ territory. Meanwhile, the Inventories Index was flat (the same reading as in March) and in slight contraction territory.
- The Prices Index climbed into strong expansion (or ‘increasing’) territory, as commodity driven costs continue to increase. Imports continued to grow, but at a slower rate in April.
