CARLSBAD, CALIF. – When members of the American Machine Tool Distributors Assn. meet here in April, they will address the problems of a market that has declined for more than two years. Machine tool sales figures have fallen repeatedly, month to month, and AMTDA continually searches for ways to improve the lot of its members.

While there have been a few brief spurts in machine tool buying, the United States Machine Tool Consumption report's moving average figure declined steadily in the year beginning October, 2001. Nationwide, sales results were down a whopping 23.3 percent that year. The report is a joint endeavor of AMTDA and the Assn. for Manufacturing Technology and is released monthly.

Through marketing, education, customer training and legislative cooperation, AMTDA hopes to derail further erosion in the market. In the short term, AMTDA wants to send managers away from its 78 th Annual Meeting, to be held April 6-9 at La Costa Country Club, with tools they can use immediately.

AMTDA president Ralph Nappi said the situation is critical for many distributors. Sales volume has dropped 60 percent since the industry's peak year in 1998, he said.

"The sharp decline continued in 2002," he said. "We expect a better year in 2003, with sales increases in the 10-15 percent range, but we will still be vastly down in dollar sales. Some distributors won't survive."

With that in mind, AMTDA decided to call its meeting Future Drivers: Tactics for Tomorrow. Distributors will come away with concrete steps to take the very next business day, not in a month or in a year, Nappi said. The time element is too critical for many members to wait longer than that. Most machine tool market segments did poorly last year, the exceptions being medical equipment and construction equipment, he said. Aerospace, particularly commercial aircraft, was hard hit, and automotive was mixed.

"The focus of the meeting must be on the fight for survival, on tactics as opposed to strategy. 'Strategy' implies a long-term focus. Distributors have an immediate need for help," Nappi said.

Two speakers this year will address the immediacy of the problem during the keynote presentation, one from a distributor and one from a supplier perspective. Jim Ellison, chairman of Meritage, Inc., a distributor of machines and services, and Denis Dupuis, general manager of Haas Automation, Inc., a machine tool builder, will give their insights into the "future drivers" shaping the industry. The keynote presentation kicks off the meeting at 8 a.m. on April 7.

Other distribution industry speakers include Scott Benfield of Benfield Associates; Abe Walking Bear Sanchez of A/R Management Group, Inc.; and Mark Dancer of Pembroke Consulting.

While the Purchasing Managers Index for December, released by the Institute for Supply Management, jumped significantly to 54.7, factory capacity utilization for durable goods manufacturing remained near the 70th percentile, 13 points below its recent high of 83 in May of 2000.

"The PMI [December figure] was encouraging, but what we really need is three months with the PMI over 50, especially with growth each month over 50. That will signal a real change," Nappi said.