PMPA’s December 2016 Business Trends Review and Summary showed our Industry shipments declined about 3.3% year over year. The index fell to 117 (Just 0.6 below the trailing five year average!) but down from 2015’s 121.
That was last year. What does 2017 look like for our precision machining shops?
According to PMPA’s Business Trends Report: Net Sales outlook for precision machined products exploded in this month’s survey with fifty-four percent of respondents expecting sales to increase in the first three months of 2017, and thirty-eight percent expect sales to remain level. Ninety-two percent of our shop respondents expect sales to remain level or increase in the next three months. All other sentiment indicators were positive as well: Lead Time, Employment, and Profitability.
PMPA members get the Business Trends Report monthly to help them calibrate to sales, hours scheduled, and outlook for Sales, Lead Time, Employment and Profitability of their peers.
What indicators do you use to make sense of the market each month?
Month: January 2017
The current exemptions for Lead in work piece materials for our shops will remain in effect and will not expire until the EU Commission completes the current ongoing review of the applications.
According to Electronics Industry Portal I-Connect007, the EU is unlikely to publish the RoHS exemptions any time soon. Apparently the EU Commission only got around to reviewing the requests last month. December 15, 2016. December 2016!
And they are only now in the process of preparing draft legislation to be sent to the member states for consideration later this year.
Later this year!
Bottom Line for your precision machining shop and your customers:
- A decision on the RoHS exemptions of interest to the precision machining industry is unlikely to be made until Fall of 2017.
- The current exemptions for Lead as an alloying element in steel, Lead as an alloying element in aluminum, Lead as an alloying element in copper will remain in effect and will not expire until the EU Commission completes the current ongoing review of the applications.
Here’s the full statement from I-Connect007
“The EU Commission and Member States continue to meet to discuss the disposition of RoHS exemption renewal requests submitted by industry in January 2015. During their December 15, 2016 meeting in Brussels, the experts reviewed requests on: Lead as an alloying element in steel (Annex III exemption 6a); Lead as an alloying element in aluminum (Annex III exemption 6b); Lead as an alloying element in copper (Annex III exemption 6c); Lead in high melting temperature type solders (Annex III exemption 7a); Lead in a glass or ceramic other than dielectric ceramic in capacitors (Annex III exemption 7c-I), jointly with exemption request 2015-1; Lead as activator in the fluorescent powder (Annex III exemption 18b), jointly with exemption request 2015-3; Lead in solders for the soldering to machined through hole discoidal and planar array ceramic multilayer capacitors (Annex III exemption 24); and Lead in cermet-based trimmer potentiometer elements (Annex III exemption 34).
“The Commission is currently working on preparing the draft legislative proposals for these and other exemptions) which will be sent to Member States for written consultation. The drafts will likely be published in the spring; final legislative acts could be published in the Official Journal of the EU (OJEU) in the fall at the earliest. Under the EU RoHS2, all existing exemptions were set to expire by July 21, 2016. However, all exemptions for which industry submitted a renewal application will not expire until the EU Commission completes the current ongoing review of the applications.”
I-Connect007
(PS. Interesting footnote, I searched for an image of the European Union Commission and found the one above-on a blog about the EU Commissions delay to decide on a VISA issue– last April. Not an isolated case of Bureaucratic delay!)
Photo credit: Pulse Blog
Status Report on RoHS Leaded Materials – January 10, 2017
The European Commission is almost a year late on providing their decisions on the RoHS exemptions that affect our industry.
The attached report will help you make sense of the review on exemptions for lead in Steel (6a.), Aluminum (6b.), and Brass (6c.) as per the recommendations by the consultants. This information will help you understand and evaluate the likely usage and availability of these leaded materials for our industry going forward.
Existing exemptions remain in effect until the European Commission takes action on the consultants’ report.
The EU decision on the RoHS 2011 recast appeals for exemptions for leaded materials for machining is almost a year late- the decisions were due from the commission January 21, 2016.
January 21, 2016!
PMPA has reviewed the findings of the study group assigned to review and report on the appeals regarding Lead for machining purposes in Steels, Aluminum, and Copper alloys.
If you are a PMPA member, you can get our summary providing the latest status of the RoHS exemptions that affect our shops. The EU is almost a year late with their decision on the exemption appeals for leaded materials for machining under the latest (2011) RoHS recast.
PMPA has posted a summary of the consultants’ findings and their potential impacts on our machining companies for our members information on the PMPA website here.
We have really been challenged by the EU to stay up to date on these exemptions, being almost a year late with the decision certainly keeps the uncertainty high for manufacturers.
I wonder if the European Commission is as lenient with the deadlines on the regulated communities as they are for their own?
If you are a PMPA member, you can get the latest Status of the RoHS exemptions that affect our shops here : January 2017 RoHS Exemption Summary Report
If you are not a PMPA member, where do you go to stay up to date on regulatory issues that affect your business?
Status Report on RoHS Leaded Materials – January 10, 2017
Wednesday January 11, 2017
The European Commission is almost a year late on providing their decisions on the RoHS exemptions that affect our industry.
The attached report will help you make sense of the review on exemptions for lead in Steel (6a.), Aluminum (6b.), and Brass (6c.) as per the recommendations by the consultants. This information will help you understand and evaluate the likely usage and availability of these leaded materials for our industry going forward.
Existing exemptions remain in effect until the European Commission takes action on the consultants’ report.
The Institute for Supply Management announced on Tuesday that its Purchasing Manager’s Index (PMI) for Manufacturing index rose 1.5 percentage points to 54.7 in December, its highest level in two years and up from 53.2 in November.
This is great news- let’s look at some details to find out why:
- New Orders component– new orders rose 7.2 percentage points to 60.2 – their highest level since November 2014
- Strength in Employment component– employment rose 0.8 percentage point to 53.1 – the highest since June 2015
- And strength in the Production component-production improved to 60.3- very unusual outcomes for Manufacturing in December.
This is an unexpectedly solid report showing Manufacturing industry performance stronger in December than in November.
Here is why we see this as a bellwether for a great 2017 for our precision machining companies.
- U.S. Light Vehicle (Auto) Sales set annual sales record according to the Wall Street Journal and reports we heard from online videos from AUTO NEWS. “A total of 17.55 million vehicles were sold in 2016, roughly 60% of which were classified as light trucks” according to the Wall Street Journal.
- 2016 sales volume was up ~ 700,000 light vehicles, according to reports from Auto News
- The average age of the U.S. Light Vehicle Fleet in 2016 was a record 11.6 years, According to Statista online,
There is still plenty of reason to expect demand for light cars and trucks to be sustained based on the average age of the U.S. Fleet and the current low unemployment rate reported by the Federal government. Knowing that Automotive is the precision machining industry’s most heavily served market convinces us that these numbers reported by ISM, WSJ, Auto News and Statista bode well for our precision machining shops in 2017. I hope that you are preparing for success, not for hunkering down in 2017.
Happy New Year, indeed!
Link to ISM December 2016 report
Statista Age of Light Vehicles in U.S.