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Article Excerpt
Metals Service Center Institute President M. Robert Weidner III and Chairman Maurice "Sandy" Nelson of Earle M. Jorgensen Co. fielded questions March 31 from Metal Center News Managing Editor Corinna Petry for this wide-ranging Q & A. On the eve of the institute's May 4-6 annual meeting in San Diego, its top two officials offered their views on the economy, global competition, supplier and customer relationships, and industry and association consolidation. Following is an edited transcript.
MCN: How would you characterize the environment for steel and aluminum distribution today?
NELSON: Very difficult. The reason is we are a service industry, servicing manufacturing in North America, which is in a long, deep freeze right now. There are no signs of an upturn.
WEIDNER: I concur with that. We continue to bump along the bottom of this economic cycle.
MCN: Please forecast the pace of economic activity for the remainder of 2003, and describe the strengths and weaknesses in the major markets served by metal centers.
WEIDNER: As we look at 2003 demand, there has clearly been some impact, or influence, from the war. It's impossible to quantify what that is, but there is no question it's contributing to the slowdown. Even if the war were to end tomorrow, we then face the third and fourth quarters, which are historically slow. We do not have an encouraging outlook for the rest of 2003.
NELSON: Strengths and weaknesses. Capital goods is down. Technology, aerospace, agriculture are all down. Energy and power generation are weak, too. Automotive has been surprisingly resilient. Big trucks are down. The only strong areas are defense and toys: Harley-Davidson and off-road [recreational] vehicles. Firearms producers are doing well. Canada is doing surprisingly well. The mainstay manufacturing sectors are weak.
WEIDNER: Although defense aerospace is up year over year, commercial aerospace is off by about $20 billion. Many of the major airlines are either in Chapter 11 or are perilously close to filing for bankruptcy. Continue to watch the finished car...
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