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    1. Industry News

    Equipment Price Increases Leveling Off

    Nov. 15, 2024
    Year-over-year rate of increase is at 2.1%.
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    For the second month in a row, the Producer Price Index for construction machinery and equipment has remained flat, according to analysis by Associated Builders and Contractors. In October, equipment prices increased 0.1% compared to September.

    Equipment prices are up 2.1% compared to October 2023 and 30% from February 2020, cited as the beginning of the pandemic.

    The Producer Price Index for construction inputs increased 0.3% in October.
    The Producer Price Index for construction inputs increased 0.3% in October.

    Overall construction input prices rose 0.3% in October, according to ABC, while acknowledging the uncertainly of price trends in a Trump administration.

    Prices increased in all three energy subcategories last month. Natural gas prices increased by 29.3%, unprocessed energy materials prices rose 9.9%, and crude petroleum prices advanced by 7.3%. Overall construction input prices are 0.2% lower than a year ago, according to ABC.

    What Industries Expect from a Trump Administration

    “Higher energy prices drove the increase in construction input prices observed in October,” said Anirban Basu, chief economist. “While prices for a few other materials, like concrete and copper products, also rose for the month, overall input prices are lower than they were one year ago and have fallen 5% since reaching an all-time high in June 2022.”

    Heading into 2025, it’s unclear if prices will remain so well-behaved,” said Basu. “The next administration’s trade policy increases uncertainty regarding construction materials costs. Beyond the implications of potential tariffs, input prices may rise in the short term if purchasers rush to import materials prior to the implementation of those policies. As of October, contractors expected their profit margins to expand through the first quarter of 2025, according to ABC’s Construction Confidence Index. That portion of the index will bear close watching as trade policy shifts in the coming months.”