NEMA’s Primary Industrial Controls Index increased 4.5% on a quarter-to-quarter basis during the first quarter of 2013 after declining for three consecutive quarters. The index stands 1.7% below its year-ago level but nearly 50% above the cyclical trough observed in mid-2009. Nonetheless, the inflation- and seasonally adjusted level of shipments remains below the pre-recession peak reached in 2007. The Primary Industrial Controls and Adjustable Speed Drives Index, a broader measure of industrial controls demand, also posted an increase during the first quarter of 2013, gaining 2.4% following a 0.2% loss in the fourth quarter of 2012. However, the index is down 0.7% on a year-over-year basis.
The growth in the indexes coincided with accelerated manufacturing activity in the first quarter of 2013. However, manufacturing sector industrial production is losing momentum moving into the second quarter as output declined 0.3% in March and 0.4 % in April. Still, the forward-looking ISM manufacturing index for new orders hovered above the break even mark of 50 on average for March and April. Industrial production, a key demand driver for industrial controls, is expected to increase by 2.3% year-over-year for 2013, before picking up to the upper 2% range in 2014 amidst improved domestic and global demand.