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After a precipitous drop in the second half of 2008, custom injection molders’ average machine-hour rates held firm in the first half of this year. June responses to our semi-annual survey by 102 plants nationwide moved our Hourly Rate Index up a barely perceptible 0.3 percentage points. Average machine capacity utilization also held even at the December level of 47%, though that is still the lowest level in 26 years of surveys. Also unusual was the remarkable uniformity of capacity utilization across all regions of the U.S.

Custom molders reported some optimistic signs. Twice as many respondents (16%) raised their rates in the first half as lowered them, though 76% did not change their rates at all. Also, 31% of molders saw increased capacity utilization, twice as many as in December, vs. 49% who had lower utilization (down from 62% previously). And 45% of molders expected business conditions to improve in the short term, vs. 22% who expected business to worsen and 33% who predicted no change. That was the highest level of optimism and lowest level of pessimism seen in two years.

The complete picture is far from rosy, however. Responses from 60 moldmaking shops indicated a 20% decline in new orders in the first half after a 17% drop in the previous six months.

This Hourly Rates survey is the first we have conducted in cooperation with market information and consulting firm Townsend Solutions of Houston.