Forging and Stamping

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 2,000 forging and stamping companies in the US produce a variety of metal-based products that are typically used as parts or components in assembled items. Major revenue categories include stamped metal products, forged metal products, custom roll forming products, and powder metallurgy products. Services may include design engineering, machining, part assembly, and finishing (such as cleaning, welding, or deburring).

Dependence On Manufacturing Activity And The Economy

Demand for forged and stamped products is driven by manufacturing volume, which is vulnerable to changes in economic conditions.

Capital-Intensive

The forging and stamping industry is highly capital-intensive and requires significant investment in plants, property, and equipment, such as presses, hammers, conveyers and furnaces.

Industry size & Structure

The average forging or stamping manufacturer operates out of a single location, employs 44 workers, and generates $16 million annually.

    • The forging and stamping industry consists of about 2,000 firms that employ 90,800 workers and generate about $33 billion annually.
    • The industry is somewhat concentrated at the top and fragmented at the bottom; the top 50 companies account for 47% of industry revenue.
    • Metal stamping firms account for 36% of industry revenue and 60% of firms; forging firms account for 35% of revenue and 18% of firms; custom roll forming firms account for 22% of revenue and 16% of firms; powder metallurgy manufacturers account for the remainder.
    • Large companies with stamping and forging operations include Mueller Industries and Park Ohio Holdings. Large firms may have international operations. Most forging plants are small or medium-sized companies.
    • Some large customers, such as automobile or aircraft manufacturers, are vertically-integrated and have internal forging and stamping operations.
                                      Industry Forecast
                                      Forging and Stamping Industry Growth
                                      Source: Vertical IQ and Inforum

                                      Coronavirus Update

                                      Apr 29, 2022 - Trade Agreements Cheapen Metal Imports
                                      • The US forging and stamping industry will see greater supply as lower-priced imports enter the market. In March 2022, the US and UK reached a trade agreement after four years of disputes over steel tariffs, according to Reuters. Under the agreement, 500,000 tons of duty-free steel can enter the US market from the UK per year. In February 2022, the US and Japan reached an agreement on tariffs to allow imports of up to 1.25 million metric tons of steel to enter the US duty-free. Additional shipments are subject to tariffs. A similar deal with the EU allows 4.3 million tons to enter the US market duty-free, annually.
                                      • Ford, General Motors, Volkswagen, and other big automakers are spending billions of dollars to develop electric vehicles (EVs) in a race to catch Tesla. Ford in April 2022 announced it has produced about 2,000 electric Ford-150 pickup trucks and planned to begin delivering them to customers soon. Ford has taken more than 200,000 orders for the new F-150 Lightnings, which the company describes as the most important model to roll off its assembly line in decades. GM recently introduced some luxury EV models, including a Hummer pickup truck, and expects to offer a mass-market electric pickup in 2023.
                                      • In March 2022, investment bank Goldman Sachs cut its gross domestic product (GDP) growth target for 2022 to 2.9%, expecting the spike in oil prices to hurt spending and shortages of key metals to constrain manufacturing. GDP is a measure the value of all finished goods and services produced in the US. Goldman analyst, Jan Hatzius, places the risk of a recession in the next 12 months at 20-35%.
                                      • Production at US factories, a driver of demand for forging and stamping services, decreased slightly in March 2022 from the previous month, according to The Institute for Supply Management. Manufacturers' new orders, production, and backlogs continued to grow and so did supplier deliveries, but to a lesser extent.
                                      • New orders for durable goods increased 10.2% in value year over year in March 2022 and reached a March record level, according to the US Census Bureau.
                                      • Employment in the forging and stamping industry increased 5.7% year over year in February 2022 but was down 3.9% from the pre-pandemic month of February 2020, according to the US Department of Labor.
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