Market Conditions

October, 2016

As 2016 draws to a close, let’s reflect on the year in the used machinery market.

Metalworking:

The market for used metalworking machinery was strong through 2015.  Commodity CNC machines like Mazak, Hass, and Mori Seiki that were manufactured in the mid to late ‘90’s held their value pretty well  —  but since the beginning of the year, these mid-nineties’ commodity machines have lost about 40%  of their  value compared to last year.

One example:    Mazak Quick Turn 20 s … mfg in the mid ‘90s sold last year, averaging  $28,000

Today, similar Quick Turn 20s are selling for an average of $16,000

CNC machines less than 10 years old are holding their value pretty well.

Plastics:

Not many sales this year.  A recent September sale with large capacity machines brought good prices for injection molders between 8 and 12 years old.

Woodworking:

Market’s been soft for quite some time.

Printing:

Similarly, the printing industry is in trouble.  As you would expect, big web presses, both commercial and newspaper, can’t find a market.  The newspaper industry has been switching to online for years and auction prices reflect that.  When these web presses sell, it’s pretty much for scrap value.  Also, despite our own personal love of books here at The Book, bindery equipment such as stitchers, trimmers, perfect binders, folders and inserters aren’t in high demand.  Interestingly, paper cutters, particularly Polar Mohr, are doing well.  And speaking of trends, digital presses are the hot item in the printing industry right now; however, they depreciate quickly, at rates comparable to computer equipment.  Finally, Heidelberg and Komori sheetfed presses are still marketable – while their values may be down from 2015, there are still buyers out there for these presses.

Processing:

No matter what the economic trends look like, people still eat and take their medicine, so the value of used food and chemical processing equipment is holding up well. The merger of Kraft and Heinz dumped some excess equipment on the market, and that trend may continue through the next few years as large consumer packaged goods companies consolidate, but for the most part these liquidations have not negatively affected the value of this equipment.  Americans also eat more packaged convenience foods in times of economic uncertainty, so these industries will tend to be less subject to wild valuation swings.

Oilfield:

With the decline in oil prices comes a decline in the prices for oilfield equipment.  Items at recent Kruse and Canon sales are going for less than half of what they sold in 2015.   The equipment value will recover if and when oil prices rebound.

To give you an idea of the auction activity in North America:

Overall, the number of auctions are down from 2014 to 2015.  Through the third quarter of this year (2016), the number of sales is just about equal to the YTD third quarter of 2015.

Historically, a recap of the sales be industry is:

Industry
2013 2013 2014 2014 2015 2,015
# Sales % # Sales % # Sales %
Metal 931 55% 869 56% 802 59%
Wood 122 7% 87 6% 76 6%
Plastic 64 4% 70 4% 47 3%
Print 104 6% 102 7% 89 6%
Processing 206 12% 169 11% 173 13%
Hi Tech 149 9% 149 10% 66 5%
Medical 77 4% 64 4% 63 5%
Audio/Video 39 2% 20 1% 26 2%
Textile 15 1% 13 1% 15 1%
——– ——– ——– ——– ——– ——–
1707 100% 1543 100% 1357 100%
2013 2013 2014 2014 2015 2015
# Sales % # Sales % # Sales %
Location Only 46 3% 35 2% 16 1%
Timed Sale 753 46% 731 49% 737 55%
Webcast 824 51% 727 49% 584 44%
——– ——– ——– ——– ——– ——–
1623 100% 1493 100% 1337 100%