Repossessions and liquidations of construction equipment nearly tripled in the first quarter of 2009, according to Nassau Asset Management's NasTrac Quarterly Index, in a sign of the continuing struggles of the construction, manufacturing and transportation industries.
Ed Castagna, president of Nassau Asset Management, said the housing decline first deeply affected the truck sector and is now reaching into the construction equipment category. He said the increase in repossession activity indicates that federal stimulus funds have yet to reach their targeted audiences with the speed and impact that was planned.
While some experts believe the housing market is beginning to exhibit a slight turnaround, thanks to low prices sparking interest among buyers, the glut of homes currently on the market is reducing the need for additional construction.
The Architecture Billings Index, a leading indicator of U.S. nonresidential construction, has begun to exhibit signs of renewed interest in building projects in the past two months.
However, Castagna said any signs of positive activity are restricted to specific areas or larger companies and have not produced enough momentum to improve conditions in the construction equipment sector as a whole.