Spending for packaging machinery in the United States is expected to increase this year, but only by a modest 1.5 to 2.5 per cents, according a study by the Packaging Machinery Manufacturers Institute.
The study is based on interviews with over 400 decision makers throughout the manufacturing sectors. Those interviews, the report contends, were conducted in January and February, a time marked by economic pessimism and market uncertainty.
Thus, the growth to $4.99 billion (€5.5 billion) in 2002, is predicated on the belief that with the economy improving now, a significant number of packaging machinery budgets are likely to be revised upward. Initially, much of the spending will go to replacement equipment as companies strive to improve productivity and profitability, the report says. Later in the year, once capacity utilization increases, the report predicts that spending for expansion will begin.
In terms of market segments, pharmaceutical/medical companies lead the way with up to 10 per cent higher spending on packaging machine purchases this year over last. Converters and printers and makers of personal care products are two other segments that will outpace the average growth rate in machine purchases. The food and beverage sector is expected to remain relatively stagnant.