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CELIMO International Meeting Presentations

EMO Hannover, Wednesday 20th September 2017

The Countries of CELIMO

• CELIMO covers 12 European countries

o Austria

o Belgium

o Germany

o Finland

o Sweden

o Switzerland

o Turkey

o United Kingdom

o France

o Italy

o Netherlands

o Spain

• We also have an Associate Member in Hungary

Who are our Members?

• The CELIMO Associations represent Distributors and Importers of Machine Tools, Tooling and Technologies

• Although there is some overlap, 50% supply machine tools, 30% tooling, with the remaining 20% in other equipment

• 58% are of companies are sales subsidiaries and 42% are independent companies

AGENDA

International Presentations

EUROPE, Mr Geoff Noon, CELIMO Secretary

INDIA, Mr P Ramadas, President IMTMA

USA, Mr Pat McGibbon, AMT Vice-President, Strategic Analytics

JAPAN, Mr Hiroshi Usami, JMTDA Executive Director

The economic charts will focus mainly on the European Union area as a whole, but we will look at individual countries in some cases.

The European economy overall is growing at its fastest pace since 2010 and, as we shall see in this presentation, the prospects for most countries look positive.

This is probably the last time we will look back at the “great recession”, but it is worth noting a wide variation in the recovery experiences.

Germany was first out of the blocks and by the end of 2010 it had got back to the pre-recession size of the economy.

The Recession & Recovery

Source: Eurostat

European Unemployment

Source: Eurostat

Although the UK took longer to recover, it is now progressing as well as Germany in relation to its pre-recession size. Spain and Italy had two phases to their recession; while the Spanish economy has now got back to its pre-recession size, Italy still has a long way to go.

This economic recovery is driving down unemployment in Europe. The Euro-area unemployment rate of 9.1% in July is the lowest since February 2009 and for the EU28, the rate of 7.7% in July is the lowest since December 2008. In the separate countries, the unemployment rate ranges from 2.9% in Czech Republic up to 17.1% in Spain (overall, some areas much less, others much more) and 21.7% in Greece.

Having been stable for about 12 months, inflation started to rise in Europe around the middle of 2016, but in recent months it has started to fall back a little.

There is a wide variation in inflation rates across Europe. Some countries, most notably perhaps the UK, are affected by a significant weakening of the exchange rate - I promise not to mention the “B” word! - but it is less clear why inflation is so high in small countries such as Estonia and Lithuania.

The Purchasing Managers Index (PMI) in the Euro-zone is at its highest level for over 6 years, matching the reading recorded in June. Traditionally, this has a good correlation to the output trends.

European Inflation

Source: Eurostat

European PMI’s

The good news is well spread among the countries included in the overall Euro-zone PMI.

Austria, Netherlands, Germany, Italy and France are all at or close to their highest level for six years. Perhaps the one concern is Spain, but this has been strong recently and this may just be a pause - after all, a PMI of 52.4 still points to a reasonable level of expansion in the manufacturing sector.

In line with this, we have seen Industrial Production in Europe on a steady upward trend for some time and although it is not quite back to its pre-recession level (which is just about still on this chart!), it looks set to continue towards that point.

This chart looks at the key customer industries.

The Automotive and Aerospace industries (the latter being the largest element of “other transport”) are both operating at record levels.

Neither Machinery - which was most exposed to global issues such as the oil price and the Chinese construction downturn - or Metal Products has managed to get back to its pre-recession level, but the recent trends suggest that both industries are, at last, starting to see some improvement.

There has not been much movement in capacity utilisation levels, but most of the major economies are operating at general high levels and are trending upwards.

The chart shows the data for the individual countries, but you should note that the levels and trigger points for investment to expand capacity will vary between countries; you cannot, therefore, make a direct comparison of the levels, although the trends within and between the countries are valid.

Exchange rates are a key driver of relative competitiveness between economies. It is also worth bearing in mind that the drivers of this can come from either one of the currencies involved or both at the same time and not necessarily in the same direction.

Against the US$, the Euro had been relatively weak since the start of 2015, but it has been strengthening over the past six months.

The movement against the Swiss Franc that took place in just 1 hour when the Swiss Central bank withdrew its support is also clear and, again, it is only relatively recently that the Euro has started to strengthen again.

The trends against the GB£ and the Yen are, perhaps, less clear, but the upshot is that both are now close to the level they were at when this chart beings in 2005!

We have data for the source of imports into the CELIMOcountries, although not the value of imports from the smaller European countries which were not included in the analysis, except where some respondents have given the data for one or two extra countries. Another complication is the re-exports from Belgium; some of these originated in Europe, while others came from outside the region.

Including all imports from Belgium, 62.6% of total imports into the CELIMO countries came from elsewhere in Europe; excluding all imports from Belgium reduces the percentage to 60.4%. However, allowing for “genuine” exports from Belgium of machines originating in other European countries, we can be fairly certain that the final percentage is likely to be around 62%.

Germany remains the most important source of imports into the CELIMO countries, with Switzerland the most important source of machine tool imports into Germany.

This is calculated using Production - Exports + Imports; any issues with any of these series can affect the result. Other Asia in this case is defined as South Korea + Taiwan + India.

Machine Tool Consumption in the CELIMO area grew by +2.0% in 2016 to €14.9 billion, the best since 2008, but still a long way off that figure (which was €16.7 billion).

The machine tool market grew in 6 of the CELIMOcountries and fell in 6; the largest increase was in Italy in both percentage and value terms, while the largest decline in percentage terms was in Finland and by value in Switzerland.

The German machine tool market is almost back to the “boom” level that we saw in 2008 and it accounts for about 40% of the CELIMO area total.

The Italian economy struggled to recover from the recession for a few years, but since 2013 it to has been on an upward trend, helped recently by incentives to invest in high-technology equipment.

Turkey is the 3rd largest European machine tool having overtaken France, Switzerland and Spain during the recession. However, it has plateaued somewhat since 2012.

The trend for the UK is distorted by exchange rate changes, most notably perhaps the extent of the growth in 2014, but since that peak we have seen demand fall back a little.

The dip in the Swiss market is, at least in part, a reflection of the exchange rate change in January 2015.

France has seen a recovery over the past couple of years, although it still has a little way to go before it is back to its pre-recession level.

Spain, like Italy, took some time to recover, but there has been strong growth since 2014.

Overall, we have a picture of a strong European economy, with some parts of the manufacturing and engineering industries leading the way.

The general outlook for 2018 is positive for most of the European markets, although the longer term is more uncertain, not least because of the uncertainty of the impact of Brexit, although it is clear that the UK (and probably Ireland) will be hardest hit.

INDIAN MACHINE TOOLMANUFACTURERS’ ASSOCIATION

CELIMO NETWORKING MEETING20 September 2017, Hannover

IMTMA at a Glance

Constituted in 1946

Single point of contact for Indian Machine Tool Industry

Represents over 90% of organised machine tool and allied equipment manufacturers

Membership of 470+ companies

Indian Economy- at a Glance (2016)

GDP : $ 2.26 trillion (nominal) (2016)

$ 8.66 trillion (PPP) (2016)

GDP Growth: 7.1% (2016-17)

Exports : $ 276.5 billion (2016-17)

Imports : $ 469.5 billion (2016-17)

Source: IMF data Apr. 2017,& Fin Ministry GOI

18.5

7

11.2

1

4.93

3.47

2.62

2.46

2.26

1.85

1.79

1.53

0.002.004.006.008.00

10.0012.0014.0016.0018.0020.00

US

Ch

ina

Jap

an

Ger

man

y

UK

Fra

nce

Ind

ia

Ital

y

Bra

zil

Can

ada

GDP in US$ Tn

21.2918.57

8.665.23 3.98 3.14 2.78 2.73 2.23 1.68

0

5

10

15

20

25

Ch

ina

US

Ind

ia

Jap

an

Ger

man

y

Bra

zil

UK

Fra

nce

Ital

y

Can

ada

GDP IN PPP TnAgriculture 15.2%

Services 53.6%

Industry 31.2%

Mfg 18.1%

Sector Share in GDP(%) 2016-17

India Positivism

Fastest growing major economy of the world.

Government Thrust to take India’s GDP to $20 trillion in next twenty years.

Make in India policy aims to :

Promote investments in the manufacturing sector Increase share of manufacturing in GDP to 25% by 2025

India has moved up 16 positions to rank 39th on a global index of the world's most competitive economies.

GST – to enhance ease of doing business in India.

FDI inflows to India during 2016-17 was US$ 60 billion (largest among all countries)

Indian Machine Tool Industry

India Ranked 12th in Production and 8th in the Consumption as per 2017 Gardner’s report on world machine tool consumption.

Consumption has increased by 12% during 2016-17 and production increased by 23% during same period.

40% increase in new orders during 2017-18 (Apr-Aug)

Machine Tool Consumption Trend2013-14 to 2020-21

Source: IMTMA

571682 716

8531024

12291475

1770

12961494 1572

1708

1964

2259

2598

2988

0

500

1000

1500

2000

2500

3000

3500

2013-14 2014-15 2015-16 2016-17 2017-18E 2018-19P 2019-20P 2020-21P

Production Consumption

Val

ue

in

US

D M

illio

n

Indian Machine Tool Industry –Growth Drivers

Indian Automotive industry envisaged to be thirdlargest in the world by 2026

Automobile manufacturing to be the main driver of ‘Make In India’. Passenger Vehicle production is envisaged to grow at a CAGR of 6% till 2026.

Defence manufacturing opened to private sector

Modernization of Railway Coaches – USD 1176 Mn

Introduction of High speed trains and Bullet Trains

Strong Demand for Consumer durables

Source: Automotive Mission Plan 2016-26, http://www.makeinindia.com

Indian Machine Tool Industry

India makes Standard Products and Special Purpose Machines

:Important ManufacturersACE Designers, AMS, BFW, Electropneumatics, Hindustan Hydraulics, HMT, ISGEC ,Jyoti CNC LMW, Lokesh, Micromatic Grinding, & others…

Major products

CNC Turning Machines

Machining centers

Grinding machines

Boring machines

Vertical Turret Lathe

EDMs / Wire EDM

Inspection and CMMs

Special Purpose Machines

Metal Forming Machines

Presses and Press brakes

Accessories, Tools and Components

Tool turrets Rotary tables Bar feeders Spindles Deburring Tools & Moulds Cutting tools Form tools Tool holders Special tools

Addison, Bipico, Bhukanwala, Chennai Metco, Dagger Master, Fenwick & Ravi, Forbes, Hittco, Ind-Sphinx, Kennametal, Miven Mayfran, PARI, Pragati, Rajamane, Sandvik, SECO, Span, Taegutec, UCAM, Universal, Walter, and others….

Chucks Chip conveyors Coolant systems Robotics and Automation

Major Products:

Important Manufacturers:

Tooled up solutions

TPM friendly

Contemporary design

Reliable performance

After sales support

Cost effective, high quality, reliable and customised solutions

Strong backward integration

Industry 4.0 ready

USP of Indian Machine Tools

Export Competitiveness

Major Exports to - China, Germany,Italy, Turkey, Middle East, USA, Korea,etc.

No language difficulty

Ideal opportunity for dealers to sell competitive products

Indian Companies’ Overseas Ventures

ACE MICROMATIC GROUP

BFW

GRIND MASTER MACHINES

HMT MACHINE TOOLS

JYOTI CNC AUTOMATION

UCAM

and many more…..

Major Indian Companies with Global Footprints

32 Indian Companies are participating at EMO 2017

Company Name Hall No Stand Position

Ace Designers Ltd. Hall 17 Stand F09

Ace Manufacturing Systems Ltd. Hall 17 Stand F07

Birla Precision Technologies Ltd. Hall 6 Stand L90

Chennai Metco Pvt. Ltd. Hall 6 Stand E42

Emkay Tools Hall 4 Stand B114

Forbes & Company Ltd. Hall 4 Stand F96

Grind Master Machines Pvt. Ltd. Hall 11 Stand A65

IND-SPHINX Precision Ltd. Hall 5 Stall B101

Jyoti CNC Automation Ltd. Hall 27 Stand D70

Pragati Automation Pvt. Ltd. Hall 17 Stand A03

Precision Machinekraft Pvt. Ltd. Hall 12 Stand E90

Rajamane Industries Pvt. Ltd. Hall 6 Stand L97

Shobha Industries Pvt. Ltd. Hall 3 Stand E02

Sphoorti Machine Tools Pvt. Ltd. Hall 5 Stand B100

UCAM Pvt. Ltd. Hall 12 Stand E15

32 Indian Companies are participating at EMO 2017

Company Name Hall No Stand PositionAshoka Impex Hall 12 Stand B77

Bipco Industries (Tools) Pvt Ltd Hall 5 Stand A94

CP Grat-Ex Mfg Co Hall 4 Stand A61

Dynascan Inspection Systems Co. Hall 6 Stand A79

ESGI Tools Pvt. Ltd. Hall 5 Stand C94

Finetech Toolings Hall 5 Stand A81

GBB Industries Hall 6 Stand K90

Jain Diamond Tools Hall 11 Stand F38

Jainex Amacol Ltd Hall 12 Stand B77

Krishna Enterprises Hall 12 Stand B77

Parav Metal Processing Company Hall 7 Stand B53

Rajasthan Udyog & Tools Pvt Ltd Hall 7 Stand E13

Rigicut Tools Pvt. Ltd. Hall 5 Stand E29

Stamp IT Robitai &Solutions Pvt Ltd Hall 11 Stand F19

Steelmans Broaches Pvt Ltd Hall 4 Stand A61

Tecnicrafts Industries Hall 5 Stand A94

Vaico Hall 5 Stand A94

India at EMO Hannover

• Enter co-operation agreements

• Explore business partnerships

• Strategic partnerships for global markets

Thank You

U.S. Machine Tool Forecast

Patrick McGibbon

AMT –The Association for Manufacturing Technology

Year

2017f

2018f

Oxford Economics

4.1

4.7

Eli Lustgarten

+5% ‐ 10%

+10% ‐ 15%

AMT Consensus

12.5%

4.5%

US Machine Tool Order Forecasts

2016 US Production (in millions)

• Metal Cutting: $4,232

• Metal Forming: $1,68072%

28%Metal Cutting

Metal Forming

Production Data

2948

4075 4188 4280 4653 4451 4232

1012

12151416 1531

15181459 1680

2010 2011 2012 2013 2014 2015 2016*

$’s in M

illio

ns

US Machine Tool Production

Metal Cutting Metal Forming

Source: US Census – Annual Survey of ManufacturersNote: Excludes parts, used and rebuilt, and tools for home workshops*estimates based on 2015 Census data and USMTO 2016 data

AMT ‐ US Machine Tool Figures 2012 2013 2014 2015 2016

Imports (millions of current USD) 5,824 5,212 5,260 4,919 4,478

Consumption (millions of current USD) 9,272 8,785 9,277 8,868 8,882

Imports/Consumption 63% 59% 57% 55% 50%

40%

45%

50%

55%

60%

65%

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$10,000

2012 2013 2014 2015 2016

Imports % of C

onsumption

$’s in M

illions

Imports Consumption Imports/Consumption

Imports & Consumption

AMT Current Conditions Report 8/10/17 Patrick McGibbon

Segment Business Conditions Status Notes

Manufacturing Technology Business Conditions Mfg Tech orders are on the upswing

Durable Goods Manufacturing Business Conditions Several key industries are lagging but MFG is still growing

Economic Indicators Summary Status Notes

Purchasing Managers IndexPMI hasn't been this high since end of 2014 which was peak

of mfg technology orders

Capacity Utilization for Mfg. Capacity Utilization continues to wobble its way upwards

Orders for Mfg. Durable Goods Paris Air Show can take credit for the 7% jump in July

Housing Starts Housing Starts continue to be a strong point in the indicators

30 Yr. Mortgage Rate Rates continue to be low compared to historical averages

Consumer SentimentConsumers sentiment bounces in the 90s which is a positive

sign

MBINew to the 10 indicators ‐ closely related to mfg tech orders

and has been over 50 since January

Light Vehicle Sales Sales have slowed to less than a 17 million annual unit pace

Baltic Dry Index Index is soft but improving

Restaurant Performance IndexSitting just above 100, the index rests at the lowest value that

still represents a signal for healthy business levels.

Automotive

Issues Notable FDI Projects

• Toyota –Georgetown, KY ‐ $1.3B

• BMW – Spartanburg, SC ‐ $600M

• Honda – Lincoln, AL ‐ $85M

Industrial Production Capacity Utilization FDI Estimated % of Orders

123.0 ↓ 77.8 ↑ $10.8B + 20%

Sources: FDI Markets, AMT, USMTO, PWC, McKinsey, Washington Post

• NAFTA Trade Deficit

• CAFÉ

• Electric Vehicles

Aerospace


• Blue Origin – Huntsville, AL ‐ $200M

• Boeing – Huntsville, AL ‐ $70M

• GKN Aerospace – Panama City, FL ‐ $50M


102.4 → 76.6 → $1.3B + 15%

Sources: FDI Markets, USMTO, IndustryWeek.com, CAPA ‐ Centre for Aviation, AerospaceManufacturingAndDesign.com, AluminiumInsider.com

• Trade Issues

• Paris Air Show

• Engine Demand

Medical


• NuVasive – Memphis, TN ‐ $116M

• GE Healthcare – Florence, SC ‐ $40M

• Thermo Fisher Scientific – Middletown, VA ‐$9.5M


93.6 → 76.3 → $643M + 7%

Sources: FDI Markets, USMTO, Federal Reserve, FierceBiotech.com, TodaysMedicalDevelopments.com

• Rapid Growth

• Aging America

• Healthcare Legislation

Off‐Road/Ag/Construction


• Ferguson Enterprises – Newport News, VA ‐ $82M

• Stanley Black & Decker – Jackson, TN ‐$29M

• Maxim Crane Works –Wilder, KY ‐ $5M


72.2 ↑ 56.8 ↑ $1.3B + 6%

Sources: FDI Markets, USMTO, RandallReilly.com, ConstructionDive.com, Association for Equipment Manufacturers, Census

• Dismal past two years

• Infrastructure Bill

• Construction Opportunity

Energy and Power Generation


• Enel Green Power –Oklahoma ‐ $435M

• Kimberly‐Clark – Mobile, AL ‐ $75M

• Duke Energy – Harrison, OH ‐ $60M


79.4 ↓ 73.7 ↑ $13.3B + 6%

Sources: FDI Markets, USMTO, EIA, AWEA

• Stirring in CAPEX

• Natural Gas

• Price of Oil

USMTO

$3,839$4,162 $4,089

$1,583

$3,116

$5,137 $5,207$4,926 $5,073

$4,178$4,113

$4,627$4,835

0

1000

2000

3000

4000

5000

6000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

$’S IN M

ILLIO

NS

Note: Numbers in blue are forecasts

Sources: AMT, USMTO

GENERATIVE DESIGN

SYNTHETIC BIOLOGYNANOTECHNOLOGY

ADVANCED ROBOTICSADDITIVE MANUFACTURING

OPEN SOURCE SOFTWARE

AUGMENTED REALITY

Machine LearningADVANCED

AUTOMATION

Pat [email protected]

703‐827‐5255

AMT Strategic [email protected]

1‐888‐544‐3597

Questions:

EEMO 2017CELIMO INTERNATIONAL MEETING

200TH SEPTEMBER 2017

PRESENTED BY

EEstablished: 1970Number of Member : Regular Members - 78 companies(both whole sellers and direct distributors)Associate Members – 66 Machine Tool builders

13 Leasing companiesTotal 157 companies

Total sales of regular members cover approx.70% of Domestic Machine Tool sales.

JAPAN MACHINE TOOL DISTRIBUTORS ASSOCIATION(JMTDA)

In this June, a new board of directors were elected and Mr. Kaoru Tomita, President & CEO of TOMITA CO., LTD. was re-elected as chairman of the board.

The educational course, SE (Sales Engineer) Certification System, for sales personnel of members and related industries will be the 27th year in this year after the educational activities have been initiated in 1991. Total students exceeded 8,200 last year and students with SE certification is expected to exceed 3,800 this year.

In the Basic course, in addition to the lecture there are machining demonstrations by the machining center, and machining operation practice by the students .

Source :Economic Outlook Aug,2017 ,Toray Corporate Business Research, Inc.

%

Source : IMF-World Economic Outlook Databases 2017 April & SNA

(GDP this year – GDP previous year ) /GDP previous year x 100

Strong Yen rate by Plaza Accord

Collapse of Bubble Economy

Asian FinancialCrisis

Collapse of IT Bubble Economy

Lehman BrothersBankruptcy

Source: Japan Machine Tool Builder’s Association (JMTBA)

East Japan GreatEarthquake Disaster


Million Yen

Source: Japan Machine Tool Builder’s Association (JMTBA )

Source: Japan’s Machine Tool Industry Almanac 2016-17by News Digest Publishing Co.,Ltd.

Source: Japan Automobile Manufactures Association, Inc.

UNIT: 1.000 cars


Source: Announcement from Motor Vehicle Manufactures

100 Million Yen

100 Million Yen

Source: Announcement from Motor Vehicle Manufactures

Source: Japan Automobile Manufactures Association, Inc.

UNIT:1,000 cars



Million YenMillion Yennnnnn

Jan.- Jul.

35% 7% 10% 21% 26% 2%

23% 10% 9% 25% 33% 2%

1%29% 8% 13% 20% 29%


2017(1-7)

Total 285Billion Yen


Source: Ministry of Economy, Trade and Industry

Investigation period:Feb.25~Mar.13 ,2013Total: 80,259 sets

Billion Yen

Start “preferential tax system & subsidy system for machine tool capital investment”


Currently many part of the domestic machine tool market is for the Motor Vehicle industry, but overseas production will expand in the future and the market is getting smaller.

Expansion of machine tool target markets

Motor Vehicle Industry

Aircraft Industry

Medical Device Industry

Motor Vehicle Industry

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