| 1 MINUTE READ

Tool and Die Sales Set to Plunge 24% in U.S.

Carmakers, who spent $8.7 billion on production tooling in North America this year, are likely to cut their investment to $6.8 billion in 2020 and $7.1 billion in 2021, predicts Harbour Results Inc.

Share

Facebook Share Icon LinkedIn Share Icon Twitter Share Icon Share by EMail icon Print Icon

Carmakers, who spent $8.7 billion on production tooling in North America this year, are likely to cut their investment to $6.8 billion in 2020 and $7.1 billion in 2021, predicts Harbour Results Inc.

CEO Laurie Harbour (pictured) attributes next year’s decline to a downturn in new-model programs being launched in the region. She notes that only 13 of the 45 scheduled new models in 2020 involve the traditional Detroit Three producers, who buy most of their manufacturing tooling locally.

Harbour says the expected gradual decline in North American car sales over the next several years will pressure carmakers to share platforms across more models, simplify trim packages and take other cut-cutting steps—all of which will reduce the need for tooling. She notes that competition from low-cost foreign suppliers, especially in China, also is hitting North American tool and die shops hard.

Harbour predicts that average annual spending on automotive tooling in North American will drop from about $9 billion over the past several years to between $6.5 billion and $8 billion through the next 3-5 years. Harbour says the downward trend already has forced at least 10 tool and die shops to close this year.

RELATED CONTENT