Covid

Here we go again… again. Wow, who’d have thought the Pandemic would still be with us and, quite possibly, getting worse. I sure didn’t and, like all of us, I’m just trying to ride it out. I’m actually not afraid of it, as I’m fully vaccinated and boosted and seldom get sick. I got the swine flu from a business trip to Chicago a decade ago, had 104 temp but recovered in 2 days. Of course, I was younger then.

I read that your antibodies (you know, the good guys) go up exponentially if you’re vaccinated, boosted, and still get Omicron. So maybe it would be a good thing, although it’s hard to let it get to us after successfully ducking it for all this time.

My prediction is that Omicron will be the last big wave. From what I’ve read, particularly about South Africa’s experience, I believe Omicron will flare up like crazy for the next month or two and then start dying off as rapidly as it came on. A lot of people will get infected (most mildly), reducing the availability of prospects and maybe leading to that coveted herd immunity. The other variants seem to have been more purposeful and grounded. Omicron seems more of a transient flash in the pan; just look at its name. I have respect for Delta but Omicron- really? Sounds like a bad sci-fi flick.

If true, it’s going to be a wonderful spring- warm temps, blooming flowers and a general sense of relief and well-being. Sure, Covid may become endemic like the cold or flu, but I’m cool with getting vaccinated annually in order to keep it from being a factor. And now, just in, Pfizer has a pill you can take when you get infected that dramatically reduces the symptoms. Covid- your days are numbered!

Business

Prices across the material handling equipment (MHE) spectrum are skyrocketing, lead times have gone from 12 weeks to 12 months in some cases and yet demand is through the roof. Some of current demand is simply a result of a strong consumer and a generally very good economy and stock market. Many hourly workers have seen dramatic increases in wages this year, so they have more spending power than ever. And since stocks represent 22% of household wealth, a good market makes people feel more comfortable spending. That demand dynamic leads to the need for more MHE, as order fulfillment is our customers’ greatest challenge.

It’s also true that some of today’s demand is the result of customers pulling forward their purchases to beat price increases and increasingly long lead times. And some is clearly the secular movement toward automation, as the cost and availability of labor continues to worsen while the cost and efficacy of automation continues to improve.

The end result for us was that 2021 was a very good year. Sure, revenue isn’t near where it would’ve been if so much 2021 equipment wasn’t now shipping in 2022, but that’s just a timing issue and results in a sales backlog that’s more than twice what it’s ever been before.

So, 2022 also looks to be a very good year, although we’re already concerned that much of what is ordered in Q1 may not ship until 2023- as so it goes… All that said, we’re blessed with how good things are – excellent new equipment sales, strong parts and service revenue, particularly as some customers are running their equipment longer than they otherwise would, and rentals being off the charts as they fill in for badly needed new equipment that is not even close to shipping any time soon.

In closing this segment, thanks to all of our customers for your business, loyalty and friendship. You know we have your back and that we’ll beat this thing together.

General Landscape

Well, the FED has finally dropped the ‘transitory’ term when describing inflation. Between high demand, expensive input costs and our now infamous supply chain woes, it’s probably here to stay for a while. I applaud them for finally stepping up with the accelerated reduction in asset purchases and planned increases in the fed funds rate next year, but it might be too little too late. That question probably lies with Omicron (you again) and how much it dampens the economy in the intermediate term. Either way, MHE demand will be robust for the foreseeable future, as ecommerce will replace brick and mortar again even if Omicron is worse than expected.

Here’s an interesting one. Did you know that the rollout of 5G has the airlines worried that it will interfere with altimeter readings, causing major issues when landing with poor visibility? The CEOs of Boeing and Airbus, the duopoly that controls the world’s manufacturing of commercial airlines, have written letters requesting that Jan. 5 change to 5G be postponed. We’ll see how that plays out. If Congress wasn’t on vacation, this seems like a great grandstanding opportunity for someone in Congress looking for positive press. I’m just surprised it’s only now getting press.

Shifting gears, is it just me or is our world filled with more knuckleheads than ever? Look at all these jerks attacking flight attendants and other passengers. Instead of arrests and fines, I think we should be given permission to throw them out the window. Ok- kidding!

But as we grow and mature as a society, shouldn’t it be going in the other direction? Sure, we all know that most people are good, but I see, hear, and read about way too many disturbing incidences. Maybe it’s not a trend, maybe I’m just more sensitized to it or, maybe, there’s better reporting these days with pervasive video and body cams.

Either way, I’m hoping that we all just get fed up with all the BS and that the pendulum starts to swing the other way. As we know from the world of physics, objects in motion tend to stay in motion until met by an equal and opposite force. Let’s be that force; let it start with each of us.

Despite being a native New Yorker with tendencies otherwise, I promise to be more patient and kinder during this Holiday Season and to carry that spirit into 2022. I know this world of ours can be trying, but Winston Churchill, who certainly knew trying times, said “success is walking from failure to failure with no loss of enthusiasm”. Let’s do our best; let’s stay vigilant and let’s not lose our enthusiasm to do good. Happy 2022!