The chart of shipments and orders for pneumatic and hydraulic products for the last 12 months stands in stark contrast to that of the year before, according to the National Fluid Power Assn. In its survey of about 100 member companies, the figures for January, 2001 show the beginnings of a sharp downturn that followed the rest of the industrial economy last year.

Alan Beaulieu, economist for the Institute for Trend Research, does economic forecasting for industrial sectors including fluid power.

"The past year was in recession in many areas before September 11," he said. "However, everything from the leading U.S. indicators to the Purchasing Managers Index [of the Institute of Supply Management] to housing starts indicates an industrial upswing in the second half of 2002."

Beaulieu said the evidence also points to consumer spending ticking up and new U.S. Department of Defense orders for products from heavy industries coming in, as well.

"Another key factor is that inventories of durable goods are down nationally. Consumers are giving a healthy push to cars, homes and other real estate. We're beginning to see some upswing," Beaulieu said.

Applied Industrial Technologies of Cleveland, Ohio, has two channels of fluid power sales: MRO/service and OEM sales. Chris Christensen, unit president for fluid power, said that the repair and services channel of fluid power did better than the OEM sales channel at AIT.

"The year was certainly down in all respects, but unbundled services for repair and MRO kept pace with our plans. Our documented value-added services have given us an opportunity to charge for some services. However, OEM felt the downturn more," he said.

Filtration service and preventive/ wear maintenance services were two bright spots in 2001, he added.

"In the last six weeks [of 2001], we've had some nice inquiries from high tech and government, so our third quarter [Jan-March, 2002] might be better than expected," he said.