Growth of Shipments for Consumer Products Not Expected Until MY 2007

The 2005 Model Year (MY) will under perform MY 2004 by 0.7 percent for all consumer outdoor power equipment products. The 2006 MY forecast for consumer products indicates that shipments will finish below 2005 MY results—falling 2.0 percent for all consumer products combined. The Outdoor Power Equipment Institute’s (OPEI) Economic Forecast predicts positive shipments growth for all consumer products during MY 2007.

The OPEI Econometric Model projects a 2.7 percent decline in consumer walk-behind powered mower shipments for the 2006 Model Year (September 2005-August 2006) before rebounding 2.4 percent in 2007. Shipments of consumer riders, after a flat MY 2006, will also recover 2.4 percent in MY 2007. The one product category that is forecast to grow every year through MY 2007 is rear engine riders. Growth of 4.5 percent is forecast for rear engine riders in MY 2006, followed by a solid 9.2 percent gain the following year. Tillers are predicted to improve by 3.5 percent during MY 2007 after a slight decline the previous year.

Factors impacting the expected slow period include: the still high federal budget deficit, continued record prices for a barrel of oil and an expected slow down in the new and existing home markets—brought on by higher interest rates.

After a strong finish in MY 2004, commercial turf care intermediate walk-behind units are forecast to contract significantly (-13.3 percent) for the 2005 MY, rebounding in 2006 with a 2.8 percent increase. Continued expansion is anticipated in MY 2007—with a 9.9 percent jump over MY 2006. Shipments of commercial riders are predicted to grow by only 5 percent for MY 2005, and will wait until MY 2006 and 2007 to expand by double-digits again. Over the past 10 years, this has been the most dynamic product category in the entire industry.

OPEI’s Econometric Forecast is prepared by Association Research Inc., based on the national economic outlook prepared by the Research Seminar in Quantitative Economics at the University of Michigan.

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