By Nick Zieminski
CHICAGO (Reuters) - An ongoing downturn in the U.S. housing industry is not about to reverse anytime soon, industrial executives told the Reuters Manufacturing Summit in Chicago this week.
For U.S. industrial companies, whose products go into new homes or are used to build them, the depth and timing of the downturn depends on the markets they serve.
"It's going to be a pretty tough year for new housing starts," said Caterpillar Inc (CAT.N: Quote, Profile, Research, Stock Buzz) Chief Executive Jim Owens. Owens' estimate of 1.1 million new housing starts in 2008 is near the high end of current expectations, he said.
The U.S. construction equipment industry peaked in 2005, Owens said.
"Something as basic as housing touches a lot of the market segments that we serve," Owens said in Chicago. "But for our sales of capital equipment, related to housing and to a lesser extent nonresidential construction, (that) was heavily impacted in 2006."
The company's global reach means that domestic weakness is offset with strength elsewhere.
Railroads and other transport companies, who often get an early view of economic activity, report weaker demand at West Coast ports, reflecting lower shipments of furniture and retail goods.
"The housing thing is here to stay," Norfolk Southern Corp(NSC.N: Quote, Profile, Research, Stock Buzz) CEO Wick Moorman said. Continued...
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