With the year half over, many organizations are reevaluating their investment plans. Are sales strong enough to justify new equipment or information technology? Will continuing uncertainty in Europe temper enthusiasm for new commitments?
At times like this, it’s helpful to know what competitors are thinking. U.S. and international manufacturing plant executives reported 2011 spending on capital equipment at 5% of sales (median) and 8.7% (average); spending on information technology was 1% of sales (median) and 4.3% (average) in 2011. Perhaps more importantly, 42% of the plant executives reported that capital-equipment spending would increase in 2012; 37% of executives said IT spending would increase.[1]
| Spending (percentage of sales) |
||||
| Capital Equipment | Information Technology | |||
| Average | Median | Average | Median | |
| Chemical Manufacturing | 5.3% | 3.0% | 1.9% | 1.0% |
| Plastics and Rubber Products Manufacturing | 7.2% | 4.5% | 1.8% | 1.5% |
| Primary Metal Manufacturing | 13.1% | 5.0% | 3.7% | 1.0% |
| Fabricated Metal Product Manufacturing | 3.9% | 2.0% | 1.7% | 1.0% |
| Machinery Manufacturing | 7.7% | 4.0% | 3.6% | 2.0% |
| Computer and Electronic Product Manufacturing | 9.6% | 5.0% | 9.1% | 2.0% |
| Electrical Equipment, Appliance, and Component Manufacturing | 10.2% | 3.0% | 8.1% | 1.0% |
| Transportation Equipment Manufacturing | 8.8% | 5.0% | 3.1% | 3.0% |
| Miscellaneous Manufacturing | 11.0% | 10.0% | 5.0% | 5.0% |
| All Plants | 8.7% |
|
4.3% | 1.0% |
2011 Manufacturing Study
Of course, not all industries invest at comparable rates. For example, a majority of plants in the plastics and rubber industry planned to increase both capital equipment and IT spending in 2012. Conversely, only a third of primary metal manufacturers planned to increase capital-equipment spending in 2012, and only 28% planned to increase IT spending.
| Change in Spending for 2012 (percentage of plants) |
||||
| Capital Equipment | Information Technology | |||
| Increase | Decrease | Increase | Decrease | |
| Chemical Manufacturing | 39% | 12% | 31% | 9% |
| Plastics and Rubber Products Manufacturing | 62% | 15% | 54% | 0% |
| Primary Metal Manufacturing | 33% | 17% | 28% | 17% |
| Fabricated Metal Product Manufacturing | 36% | 10% | 33% | 0% |
| Machinery Manufacturing | 49% | 9% | 44% | 5% |
| Computer and Electronic Product Manufacturing | 36% | 16% | 38% | 25% |
| Electrical Equipment, Appliance, and Component Manufacturing | 62% | 23% | 46% | 8% |
| Transportation Equipment Manufacturing | 57% | 14% | 39% | 0% |
| Miscellaneous Manufacturing | 25% | 0% | 31% | 25% |
| All Plants | 42% | 12% | 37% | 10% |
2011 Manufacturing Study
How do your investment plans stack up?
[1] 2011 MPI Manufacturing Study, data for industries with 15 or more respondents for 2011 spending, The MPI Group, 2011.
