MT orders total 119 bn JPY in May 2023: Fall below 120 bn JPY for the first time in 27 months

The Japan Machine Tool Builders’ Association (JMTBA) announced the firm report of machine tool orders for May 2023. The total amount of orders received was 119.5 billion yen. This was the fifth consecutive month of year-on-year (YoY) decline, and the first time in 27 months that the total order amount fell below 120 billion yen. Domestic demand was affected by fewer working days due to a large national holiday and a reactionary decline from the previous month’s subsidy effect. Foreign demand was also affected by a reactionary decline from the previous month’s large orders, resulting in a month-on-month (MoM) decline. Although both domestic and foreign demand seemed to be in a slight adjustment phase recently, and total orders in May seemed to have failed due to a lack of positive factors, the JMTBA sees “overall firmness” in the market. This was the 28th consecutive month that orders exceeded 100 billion yen. 

Domestic demand decreased MoM for the second consecutive month, and YoY for the ninth consecutive month, to 37.8 billion yen. It fell below 40.0 billion yen for the first time in three months due to fewer working days caused by a major holiday in early May and a subsidy-driven rebound. Nine of the 11 industries showed both MoM and YoY declines. In particular, the Electrical & Precision Machinery industry fell below 4 billion yen for the first time in 25 months. Among the other major industries, Industrial Machinery fell below 18 billion yen for the first time in three months, and Motor Vehicles fell below 8 billion yen for the third consecutive month. 

Foreign demand decreased MoM for the second consecutive month and YoY for the fifth consecutive month to 81.7 billion yen, falling below 85.0 billion yen for the first time in 21 months. 

Orders received by region were as follows: Orders received from Asia fell below 40.0 billion yen for the first time in three months. A downward trend was observed in China, in addition to a reactionary decline from the previous month’s large orders for electrical machinery in India. Orders from Europe fell below 18.0 billion yen for the first time in nine months. This was mainly due to a MoM decline in the EU and a reactionary decline from the previous month’s large orders in the UK, Turkey and other regions. In North America, despite a reactionary decline from last month’s large orders for aircraft, orders for motor vehicles in the area increased and remained above 25.0 billion yen for the third consecutive month. 

May Summary

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Japan MT orders for

• May 2022: May MT orders, 3 new records for foreign demand
• Jun. 2022: June MT preliminary report, orders remain favorable
• Jul. 2022: July MT orders, second-highest July month on record
• Aug. 2022: August MT orders, falling below 140 billion JPY first time in 6 months
• Sept. 2022: September MT orders, foreign demand hits a record high for September
• Oct. 2022: October MT orders, first YoY drop in two years but at a high level
• Nov. 2022: November MT orders, record the lowest in 2022
• Dec. 2022: December MT orders, driven by foreign demand despite a decline in domestic demand
• Jan. 2023: January MT orders, showing declines, domestic up, foreign down
• Feb. 2023: MT orders total 124 bn JPY in Feb 2023: Moderate trends in both domestic and foreign demand
• Mar. 2023: MT orders total 141 bn JPY in Mar 2023: Over 140 billion yen for the first time in 3 months
• Apr. 2023: MT orders total 132 bn JPY in Apr 2023: Domestic demand softens, foreign demand remains strong