Issue link: http://read.dmtmag.com/i/205815
Editor's Note Just What Manufacturers Need: More Regulation Fragile U.S. uncertainty not a reassuring backdrop for those exporting to EU. BY KIM PHELAN Equipment manufacturer diversion. Why is it that when the gov"You might have a hydraulic hose optimism is beginning to wane, ernment uses the term "reform" I can that you've been using for 30 years in and is it any wonder? only picture Inigo Montoya of "Princess your product that you source from [for Addressing the annual conference Bride" fame dryly retorting to Vizzini, example] China, and suddenly now, of the Construction Writers Associa"You keep using that word; I do not because of some substance in there, tion, AEM President and CEO Dennis think it means what you think it means." you cannot use that hose anymore," Slater cited numerous causes for signs But alas, these are just the icySlate illustrated. of manufacturer unease, but basically it fingered tips of Washington's regula"It's another headwind manufacturall boils down to one word: uncertainty. tory iceberg. Slater said the combined ers must deal with, in an economy that The slow growth trend of the construcaftershocks of sequester and shutdown is already rather sluggish," he said. And tion industry means equipment users are going to cost us big time in GDP as he likened the overall potential impact to the R&D challenges manufacturing are uncertain about future projects. well as in consumer behavior, busihas experienced through the emissions That uncertainty has bred quite a flurry ness spending, mortgages, tourism, control technology phases. of business commotion on the rental small business and financial markets. Granted, this just potentially affects side of the industry, but, says Slater, And imagine if this statement is true: manufacturers exporting products to rental's good story is only telling a piece "Overall uncertainty surrounding the of the bigger picture. For manufacturers, U.S. political gridlock is causing foreign Europe, and volume of more than 1 rental is the byproduct of a fragile situa- nations to re-evaluated the dollar as metric ton per year is where requiretion, because the absence of purchase is the international currency." ments to register kick in. But ours is a the absence of a solid positive market. global economy and a global industry; Speaking of the nations, Slater So if rental is the symptom, what's and never underestimate the power of a warned of yet another government the root cause of the uncertainty? You regulatory idea (especially one involving regulatory issue that is showing up on surely can answer that as readily as I. environmentalists) to spread like spilled the stress-o-meter of the manufacturGovernment policy, right? Think about ing community, and – not that this is paint. Croatia, Serbia, Switzerland every issue that plagues the CE industry comforting – it's not a U.S. government and Turkey are moving in the REACH now and as we look over the ropes into direction, and China, too, is apparently issue, for a change. The latest regula2014. Well, there's Tier-4 Final that is tory burden is a European Union legisla- looking at a coherent system to control influencing pricing now and value of tion called REACH – Registration Evalua- chemicals in compliance with a global future used machinery. Hmm, governtion and Authorization of Chemicals. At classification system. Do you think anyment regulation. And there's Obamacare, its simplest, REACH regulates chemicals thing to do with exports of construction machinery to China would have an another major overhaul of a different that are imported into EU countries. effect on North American markets? sort – ah, government policy strikes Actually, REACH regulates chemical AEM is preparing to roll out trainagain. Oh, what about the wind-down substances, preparations (a mixture ing to help its members understand of MAP-21 and renewal of adequate of two or more chemical substances) REACH compliance, and be assured funding for surface transportation – all and articles – in other words, think AED will be keeping dealers up to date in the government's dependable hands, tires, hoses, components, etc. that go on any far-REACHing consequences to naturally. If tax liability isn't worrying you, into the production of say, a piece of your business. (aem.org and export.gov and you believe that ignorance is bliss, construction equipment. are helpful resources on this topic) then don't talk to AED's Garry Bartecki, Slater said that for equipment, it's Thanks for reading. because he will burst your balloon faster all about what breaks down in the than you can say "like-kind exchange." recycling process. So, if a banned sub(or "last-in first-out accounting") Brace stance is in a manufacturer's machine, KIM PHELAN (kphelan@aednet.org) is the executive editor of Construction yourself for tax reform that is about as, they'll have to get it out of their supply well, reforming as "health care reform." chain – and out of the machine – in the Equipment Distribution and director of programs for AED. Time for a brainless movie quote next two or three years. November 2013 | Construction Equipment Distribution | www.cedmag.com | 7