Nine out of 10 U.S. equipment manufacturers say the COVID-19 pandemic has had a very negative impact on the economy while more than half believe it has had a very negative impact on the industry overall, according to results of a survey released today by the Association of Equipment Manufacturers (AEM).
In addition, eight out of 10 executives say the federal government should prioritize a significant investment in the nation’s infrastructure to help equipment manufacturers weather the crisis and help rebuild the economy.
“The COVID-19 pandemic has had an unprecedented impact on equipment manufacturers and the 2.8 million men and women of our industry,” said Dennis Slater, president of AEM. “Even before the current crisis, equipment manufacturers were facing challenging times as a result of the protracted trade war with China, the mounting infrastructure crisis, and a decline in commodity prices. The COVID-19 pandemic has managed to turn an already dire situation worse.”
With the onset of the COVID-19 pandemic, equipment manufacturers, suppliers, and distributors immediately stepped up to keep their employees and their communities safe and healthy, and continue to supply the equipment needed to feed people, connect the country, and power homes and hospitals. In the weeks and months ahead, they will help lead the recovery and renewal of the American economy.
The survey of presidents, CEOs, and owners of leading equipment manufacturers comes as the Congress and the Trump administration are exploring ways to continue to support businesses and limit the damage to the U.S. economy.
Slater continued, “While quick bipartisan action in Congress, including the creation of the Paycheck Protection Program, has helped many equipment manufacturers to date, this survey makes it clear that our member companies need continued support to keep the lights on and workers on the job. The vast majority of them want Congress to prioritize infrastructure investment to help support equipment manufacturers and rebuild the economy.”
The survey was in the field from April 16 to 27, 2020. The 105 respondents weighed in on the effects of the COVID-19 pandemic on the economy, the industry, their companies, supply chain and manufacturing operations, their financial expectations, as well as the challenges they face and specific ways the federal government can keep equipment manufacturing strong and ensure the nation’s economic resilience.
The survey’s key findings include:
*Nine out of 10 executives surveyed said that the impact of the COVID-19 pandemic on the overall economy is very negative, while more than half said that the impact on the industry is equally bad.
*Seven out of 10 executives surveyed have experienced a moderately negative impact on their supply chain, while a quarter said the impact has been very negative.
*Four out of 10 executives surveyed expect the outlook for the next 30 days to get worse and said they plan to lower their financial outlook for the same period of time by more than 30 percent. The outlook for the rest of the year is better, but six out of 10 said they still plan to reduce their financial outlook by up to 30 percent.
*Nine out of 10 executives surveyed cited a decline in demand for equipment as the primary impact of the COVID-19 pandemic on their business.
*Executives surveyed pointed to the financial impact on their business, the continued health and well-being of their employees, and cancelled or delayed orders as the greatest challenges they face.
*Eight out of 10 executives surveyed said they would like to see a significant investment in infrastructure to help keep equipment manufacturers in business during the crisis and set the stage for the economic recovery.
The detailed findings are available in a memo prepared by AEM’s Market Intelligence Team.
AEM continues to lead the industry’s response to the COVID-19 pandemic, and is working closely with state and federal officials to help contain the spread if COVID-19, keep equipment manufacturing in America strong, and ensure the nation’s economic resilience.
AEM has also called for bold action from Congress and federal agencies, including continued federal designation deeming equipment manufacturers and their employees, suppliers, and distributors as “essential” and additional funds for the Paycheck Protection Program (PPP) to ensure small and medium-sized equipment manufacturers have access to the cash they need to keep operations going.
AEM is also highlighting how member companies are at the forefront of local response efforts to the COVID-19 pandemic and continue to support their employees and communities.
AEM is the North American-based international trade group representing off-road equipment manufacturers and suppliers, with more than 1,000 companies and more than 200 product lines in the agriculture and construction-related industry sectors worldwide. The equipment manufacturing industry supports 2.8 million jobs in the U.S. Equipment manufacturers also contribute $288 billion a year to the U.S. economy.