The old adage about the global economy says that when the U.S. sneezes, the rest of the world catches a cold. So it goes with the relationship between the health of mobile equipment markets and fluid power demand. Based on comments at CONEXPO-CON/AGG, most global executives are cautiously optimistic about future prospects.
Sam Allen, CEO, Deere: In 2016 housing starts continued their slow recovery from the depths of 2009, and we expect that to continue. There’s also guarded optimism about what the new administration will mean for construction. President Trump has proposed a $1 trillion infrastructure plan to improve America’s transportation systems. Meanwhile, through ballot initiatives last fall there’s more than $200 billion in infrastructure funding available at the state and local levels. When these projects start, the impact on the construction industry will be significant and enduring—in some cases
Rod Schrader, CEO, Komatsu America: With higher sales for ten straight months, we’re increasing both domestic production and imports to meet growing demand. If you look at all the indicators: GDP, housing, oil and gas pricing levels and such, it looks like ‘17 is going to be pretty similar to 2016. There’s much talk about infrastructure spending, and there’s opportunity for 2018 to be a stronger year.
Stefan Heissler, Member Board of Directors, Liebherr: We are optimistic about 2017. The IMF expects the global economy to grow 3.4%; Euroconstruct is forecasting a growth rate of 2.1% for the construction sector. The U.S. economy is also in good shape, experts are expecting further growth. Furthermore, there is a noticeable stabilization of raw-material prices—a good sign for our mining division.
Martin Weissburg, President, Volvo CE: We enjoyed a strong end to 2016, with sales up 20%. We thought North America would be down a bit this year. But we’re seeing some improvement and, with infrastructure needs, there are good opportunities. Europe is stable, some markets are doing very well. Asia Pacific is seeing some commodities markets coming back. In China we saw one of the most dramatic growth and then correction stories I’ve seen in my 30+ years in the industry. Now, after bumping along the bottom, we’ve seen for a quarter or two improvements. It’s not yet time to call China a high-growth market, but we’re seeing stabilization and that’s good.
Zhang Yujing, President, China Chamber of Commerce: The world economy has stabilized after several years of downturn, and industry is seeing improvement and recovery. U.S. President Trump’s policy of increasing the investment on infrastructure has brought the good message to the construction machinery industry, and China’s Belt and Road infrastructure initiative is funding new roads, bridges and railways across Central Asia.
Jim Umpleby, CEO, Caterpillar: The generally weak global economy has meant challenging conditions for the construction industry. Although we do see positive signs in some of our markets, the global economic outlook is still uncertain. We’re encouraged by the discussion about investment in infrastructure. As I travel around the world, it’s very evident that the United States has fallen behind. Be it roads, bridges or ports, it’s important for U.S. competitiveness to invest in infrastructure.