Equipment Cost Index
2023 has wrapped with manufacturers improving the accuracy of quoted lead times. However, high demand product lines will still require careful coordination between stakeholders to maintain and sometimes modify the schedule. Although lead times have steadied, manufacturers continue to communicate the current lead times are the new normal and do not foresee a return to pre-covid levels.
2024 common cost drivers are labor and insurance. Aside from streamlining processes, a large percentage of manufacturers are changing workflow to batch manufacturing – several units are built simultaneously in each phase instead of a linear product line of individual units. The changing environment has provided workers with expanded skills sets and increased safety to avoid repetitive use injuries. Safety and sustainability are now viewed as strong investments to preserve and promote the workforce.
| Estimated Equipment Lead Times Varies Due to Equipment Sizing |
||
|---|---|---|
| Equipment Type | Previous | Current |
| Cooling Towers | 20 - 32 wks | 16 - 32 wks |
| Chillers | 25 - 60 wks | 25 - 60 wks |
| Air Handling Units | 16 - 55 wks | 16 - 50 wks |
| Generators | 50 - 110 wks | 50 - 109 wks |
| Switchgear | 42 - 80 wks | 40 - 80 wks |
| Uninterruptible Power Supply | 20 - 36 wks | 16 - 34 wks |
| Lighting Controls | 16 - 20 wks | 14 - 24 wks |
Mechanical equipment leads time are trending down for most equipment with supply chain bottlenecks like controllers and ECM fans easing. Electrical equipment lead times are tightening in range. Manufacturing capacity is being added; however, demand has not decreased. Lead times for lighting control components have improved significantly across theboard, with many components in stock and only a few SKUs with longer lead times.
Year to date industry data for 2023 versus the same time in 2022 shows electrical equipment orders increased 5.9% and shipments also increased 7.9%. For the same time period, mechanical equipment orders increased 0.5% and shipments increased 3.2%.
Average Index History
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