Heating, Airconditioning and Refrigeration Distributors International (HARDI) announced North American HVACR average distributor sales for December closed out 2010 in line with the associationâ€™s forecast; but failed short of most manufacturer and analyst projections going into the year.
HARDIâ€™s Monthly Targeted and Regional Economic News for Distribution Strategies (TRENDS) Report showed average growth for the month of 17% versus December 2009, undoubtedly driven by the impending expiration of the full $1,500 residential tax credits. The running twelve month sales improved for the fifth consecutive month meeting the top end of HARDIâ€™s 2010 growth projections at just over 10%. Four U.S. HARDI regions and Canada finished the year up double digits.
For the second consecutive month Average Days Sales Outstanding continued to decline falling much more in-line with distribution averages. Average distributor sales per employee inched up again after a modest increase last month.
As expected, the pending reduction of the $1,500 tax credits effective January 1, pulled early 2011 demand into December giving our members a great close to what was generally an underperforming 2010," says HARDI Executive Vice President and C.O.O., Talbot H. Gee. "Decemberâ€™s distributor sales mix of cooling equipment was nearly 50% 14 SEER and higher which will most certainly not be the case next month or likely any of 2011. The question moving forward isnâ€™t whether but how much high-efficiency sales will drop if weâ€™re unable to fully reinstate the 25C tax credits or grow other efficiency incentives."
"Average sales improved in 2010 for every HARDI region and the annual growth rate is the highest recorded in the HARDI Monthly Sales TRENDS Reports since mid-2006," says HARDI Chief Economist, Alan Beaulieu of the Institute for Trend Research. "We were spot-on with our 10% growth rate projection for 2010, but despite a stronger economic environment we donâ€™t see enough in the HVACR industry to sustain that level of growth next year.
HARDI released its first Quarterly TRENDS Forecast for 2011 in January and hosted an Interactive Regional Forecasting webinar on January 18. The full webinar presentation is now available for purchase at www.HARDInet.org.