Machine tools are used mainly across a range of manufacturing industries, including the automotive, transport, machinery and equipment, metal goods and other consumer goods manufacturing industries. As such, demand is determined mainly by the level of activity in these downstream markets. Demand conditions in these markets are affected by general conditions in the economy, such as business sentiment, disposable income, unemployment, population growth, interest rates and capital expenditure. Machine tools are also used throughout the construction and mining industries.
More generally, demand for machine tools is determined by price, quality, competition from imports (and fluctuations in exchange rates), as well as technological change in the industry. The age of existing equipment is another important demand determinant in the industry in Mechanical Engineering Assignment Help.
The major markets of the industry primarily consist of construction and other manufacturing industries in Mechanical Engineering Homework Help.
Metal Product Manufacturers
The industry’s largest market is metal product manufacturers, accounting for an estimated 20.3% of demand. Machine tools are used by this sector to manufacture parts or structures from metals. Such products include oil refineries, bridges, ships and jewellery.
Motor Vehicle Equipment Manufacturing
Motor vehicle equipment manufacturing is the second largest market accounting for an estimated 19.5% of the industry revenue. This also includes transport equipment manufacturing. Operators in this industry use drills, welders and moulder to construct components that are later used in the assembly of motor vehicles and other transport. This segment is expected to decline over the five years though 2013-14 due to the poor performance of the automotive industry. This is partially caused by lack of scale of domestic operators and high import competition.
Commercial construction is estimated to account for 16.4% of the industry revenue. Operators in this industry use machine tools and welders extensively while working on the metal structures of the buildings. This market is expected to increase slightly over the five years through 2013-14. However, this increase is in part due to the decrease of other market segments. Overall, the growth in the commercial construction segment has been only marginal over the five-year period Mechanical Engineering Homework Help.