High levels of both domestic and foreign demand, generally keeping strong

March 23, 2022

Japan Machine Tool Builders’ Association (JMTBA) announced the firm machine tool orders for February 2022. The total amount of orders received was 138.9 billion yen, up 31.6% year-on-year (YoY). Although orders fell below 140 billion yen for the first time in two months, both domestic and foreign demand remained high and generally remained strong. This is the 13th consecutive month in which the figure has exceeded 100 billion yen.

Domestic demand increased for the first time in two months, but fell below 50 billion yen for the second consecutive month, rising 10.6% month-on-month (MoM) to 48.8 billion. While the effect of subsidies is weakening somewhat, the automobile sector increased to nearly 10 billion yen, while the electrical/precision sector exceeded 10 billion yen for the first time, reaching a record high, thanks to strong semiconductor-related demand.

Foreign demand remained at a high level of over 90 billion yen for the second month in a row, despite the first MoM decline in two months. Asia exceeded 40 billion yen for the fifth consecutive month. Although demand contracted due to the absence of large orders from Taiwan and China, it was supported by a pickup in China and an increase in automobile-related orders in India. In North America, despite the drop in large orders for aircraft, shipbuilding, and transportation machinery in the US, orders remained high, exceeding 25 billion for the sixth consecutive month. In Europe, despite concerns about geopolitical risks, February saw a slight MoM increase for the second consecutive month to over 20 billion yen, with steady growth mainly in Germany, Italy, and other EU countries.