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North America HVAC News

International Market Strategy

International strategic market research and consultancy on building product and related markets

April 2011

World BRG's Preliminary Reports Now Published & Available!USA Building Starts Hit New Lows USA WATSCO and CARRIER Distribution Joint VentureCanada Canada's New Budget Fail to Pass - HighlightsCanada Environmental Spending Focuses on Green HomesCanada Ontario Budget Focuses on Cutting Deficit

USA Oil Rises Above $106USA Americans Want Focus on Renewables, Not Nuclear USA Differing Interpretations Of Housing Market Remain USA Reheated Proposals

North America FUJITSU GENERAL to Launch VRF Systems in NAUSA March Unemployment at 8.8%

USA UBBINK Launches Integrated Thermal & PV Roof

1 World: BRG's Preliminary Reports Now Published!

1 April 2011-- BRG has published its preliminary reports on the 2010 heating andcooling markets in many countries of the world. To obtain a copy of these ‘productsummaries and forecasts’ please contact our building products division atbpstaff@brggroup.com.

The following reports are available, both in pdf format and in our newENTERPRISE database system:

2011 Boiler Market Reports(countries covered: USA, Canada, China, France,Germany, the UK, Italy, Spain, Belgium, the Netherlands, Austria, Sweden, Poland,Russia, Czech Republic, Turkey). Boiler types covered in the reports include:

-       Wall-Hung Gas Condensing

-       Wall-Hung Gas Non-Condensing

-       Floor-Standing Gas Condensing

-       Floor-Standing Gas Non-Condensing

-       Oil Condensing

-       Oil Non-Condensing

-       Electric

-       Solid Fuel

2011 Water Heater Market Reports(countries covered: USA, Canada, China,France, Germany, UK, Italy, Spain, Belgium, Netherlands, Austria, Sweden,Poland, Russia, Czech Republic, Turkey). Water heaters covered in the NorthAmerican reports include:

-       Tankless Gas Condensing

-       Tankless Gas Non-Condensing

-       Tank/Storage Residential Gas Condensing

-       Tank/Storage Residential Gas Non-Condensing

-       Tank/Storage Commercial Gas Condensing

-       Tank/Storage Commercial Gas Non-Condensing

-       Tankless Electric

-       Tank/Storage Residential Electric

-       Tank/Storage Commercial Electric

-       Oil

-       Indirect Cylinders Separate

-       Solar Storage Tanks

-       Hybrid Water Heaters

-       Heat Pump Water Heaters

2011 Solar Thermal Market Reports(countries covered: USA, France, Germany,the UK, Italy, Spain, Belgium, Netherlands, Austria, Sweden, Poland, Russia,Czech Republic, Turkey). Products covered in the reports include:

-       Flat Plate Collectors

-       Vacuum Collectors

-       Unglazed Collectors

-       Solar Storage Tanks

2011 Heat Pump Market Reports(countries covered: USA, Canada, France,Germany, UK, Italy, Spain, Belgium, Netherlands, Austria, Sweden, Poland,Russia, Czech Republic, Turkey). Products covered in the reports include:

-       Ground Source

-       Exhaust Air-Water

-       Outside Air-Water

-       Heat Pump Water Heaters

-       Air-to-Air Heat Pumps (where relevant)

2011 Furnace Market Reports(countries covered: USA, Canada) - Productscovered inthe reports include:

-       Gas Condensing Furnaces

-       Gas Non Condensing Furnaces

-       Electric Furnaces

-       Oil Furnaces

2011 Air Conditioner Market Reports(countries covered: USA, Canada) –Productcovered in the reports include:

-       Condensing Units

-       Air Handlers

-       Air-Air Heat Pumps

-       Residential Package Units

-       PTACs

-       Mini-Splits

-       Window/Wall Units

-       Portable Air Conditioners

-      VRFs

2011 Radiator Market Reports(countries covered: China, France, Germany, UK,Italy, Spain, Belgium, Netherlands, Austria, Sweden, Poland, Russia, CzechRepublic, Turkey) –Products covered in the reports include:

-       Steel Panel

-       Towel Warmers

-       Aluminium

-       Cast Iron

-       Decorative

-       Other Steel

-       Fixed Electric Heat Emitters

2011 Biomass Boiler Market Reports(countries covered: USA, Canada, France,Germany, UK, Italy, Spain, Belgium, Netherlands, Austria, Sweden, Poland,

Russia, Czech Republic, Turkey). Boilers covered in the reports include:

-       Fossil Fuel/Universal

-       Logwood/Bifuel

-       Pellet

-       Woochip

-       Other

To obtain these product summaries and forecasts, a table of contents, or for moredetails about the report contents or our new Database, please contact us atbpstaff@brggroup.com

Other regions and countries that we are covering this year:

The Middle East:

-       Saudi Arabia

-       UAE

-       Bahrain

-       Qatar

-       Kuwait

Other Countries in the Americas

-       Mexico

-       Brazil

-       Argentina

-       Chile

-       Columbia

To receive more information about the products covered in the Middle East andSouth American (or other country) reports, the publication dates on these, or forfurther questions, please contact us at bpstaff@brggroup.com

Source: BRG CONSULT NORTH AMERICA

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Building Starts Hit New Lows

16 March 2011--  Numbers were down across the board, dropping for both startsand permits in every region on a monthly and yearly basis.

Both starts and permits had a dramatically poor showing in February, with housingstarts posting their second lowest numbers on record (data began in 1949) andpermits hitting an all-time low (data began in 1959), according to U.S. Census datareleased today.

“This was an awful report, perhaps the worst housing starts report ever,” PatrickNewport, U.S. economist at IHS Global Insight, wrote in a press release about thenumbers.

Starts fell 22.5% to an annual rate of 479,000 in February. The drop was led bymultifamily starts, which plunged 46.1% after their 77.7% surge in January. Single-family housing starts fell 11.8% from the previous month to an annual rate of375,000, a number 28.8% below where it stood in February 2010.

The Midwest set a record low for the region after starts dropped 48.6% fromJanuary and 45.7% from the year before, reaching an annual rate of 57,000 units.The Northeast experienced the second largest drop, falling 37.5% from Januaryand dropping 23.6% from February 2010 to an annual rate of 55,000. The Westdropped 28.0% for the month and 40.6% year-over-year, to an annual rate of85,000 units.

While the South was down 6.3% in February and 1.1% from the year before, it hadthe strongest showing in number of units with an annual rate of 282,000, more thantwice that of any other region.

But Newport points to permits as the numbers to watch. “Permits are bettermeasured than starts and less influenced by weather,” he wrote. “They are also agood housing-market leading indicator.”

Unfortunately, with a record low nationwide as well as all-time lows in the West andNortheast, those numbers offered little solace.

Overall, permits declined 8.2% from January and 20.5% year-over-year, reaching arate of 517,000. Single-family permits declined 9.3% for the month, hitting anannual rate of 382,000—27.0% below where the rate stood a year earlier.Multifamily permits were down 4.9% with an annual rate of 135,000.

Permits were down in every region of the country, with the Northeast plunging27.8% from January and 32.9% from the previous year, to an annual rate of57,000. Single-family permits for that region stood at a rate of 40,000, down 21.6%and 41.2% on a monthly and yearly basis, respectively. However, Newport

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attributes that drop to building code changes in New York and Pennsylvania thatbecame effective Jan. 1. The changing codes were responsible for a 50% increasein permits pulled in the Northeast in December, he notes.

The Midwest’s permits were down 5.4% overall for the month, a 17.9% decline on ayearly basis. The region’s annual rate stood at 87,000. Single-family permits for theregion were down 7.8% for the month and down a dramatic 30.6% from theprevious year, with an annual rate of 59,000.

The South was down 1.4% overall for the month, with permits down 10.6% year-over-year and an annual rate of 278,000. Single-family permits in the region weredown 4.6% and 20.2% on a monthly and yearly basis, respectively, with an annualrate of 206,000.

The West saw a 13.6% decline in permits from January and was 35.8% belowFebruary 2010’s number. The region achieved an annual rate of 95,000. Single-family permits for the area were 14.4% lower on a monthly basis and off 31.3% ona yearly basis, with an annual rate of 77,000. However, this drop may also befueled by recent California code changes that went into effect at the beginning ofthis year.

Source: www.builderonline.com

WATSCO and CARRIER Distribution Joint Venture

02 March 2011-- WATSCO and CARRIER to Form Distribution Joint Venture forthe Northeast

CARRIER to Contribute its Company-Operated Distribution with $210 Million ofSales in 2010 from 28 Locations in 11 States

MIAMI-- WATSCO, INC. today announced that it has executed a letter of intent toform a joint venture that will include CARRIER CORPORATION’s company-operated HVAC distribution network in the northeast United States. Following thetransaction, WATSCO will own 60% and CARRIER 40% of this joint venture. Thetransaction is expected to close within 45 days and is subject to the completion of adefinitive agreement and receiving customary regulatory approvals.

CARRIER’s company-operated northeast distribution network had revenues ofapproximately $210 million in 2010, with 230 employees serving 11 states from 28locations, including New York, New Jersey, Connecticut, Rhode Island,Massachusetts, New Hampshire, Vermont, Maine and portions of Ohio,Pennsylvania and West Virginia. Products sold include a broad offering ofCARRIER, BRYANT and PAYNE-brand residential, light-commercial and applied-commercial systems, along with related parts and supplies. WATSCO has alsoagreed to contribute to this joint venture its northeastern locations, which servecustomers in New York, New Jersey and all of New England with 2010 revenues of

approximately $60 million.

Albert Nahmad, WATSCO’s Chairman and Chief Executive Officer, commented:“We are excited to build on the success of our partnership with CARRIER and tosignificantly expand our presence in the Northeast market with a broad offering ofresidential and commercial products. This marks another important step in buildinga national network of locations and presents great potential to capitalize on energyconservation opportunities in one of the most populated markets in the U.S.”

Geraud Darnis, President of CARRIER CORPORATION, said: “CARRIERENTERPRISE’s performance has exceeded our expectations with sales growthoutpacing the industry. The new joint venture in the northeast will build on thissuccess to further grow share and profitability. It is expected to offer customers awider portfolio of parts and supplies and unparalleled customer service.”

WATSCO improves indoor living and working environments with air conditioningand heating solutions that provide comfort regardless of the outdoor climate. Oursolutions also promote healthier indoor spaces by removing pollutants from theindoor air that can lead to asthma, allergies and reductions in productivity.Furthermore, since heating and cooling accounts for approximately 56% of theenergy consumed in a typical United States home, we offer consumers the greatestopportunity to save money on energy by replacing existing air conditioning andheating systems with more energy efficient and environmentally friendly solutions.

There are approximately 74 million central air conditioning and heating systemsinstalled in the United States that have been in service for more than 10 years.Older systems often operate below government mandated energy efficiency andenvironmental standards. WATSCO has an opportunity to accelerate thereplacement of these systems at a scale greater than our competitors as themovement toward reducing energy consumption and its environmental impactcontinues. As the industry leader with over 500 locations in the United States andPuerto Rico, with additional market coverage on an export basis to parts of LatinAmerica and the Caribbean, significant growth potential remains given that ourcurrent revenue run-rate is less than 10% of the estimated $30 billion United Statesmarket for HVAC/R products.

CARRIER CORPORATION is the world’s leader in high technology heating, air-conditioning and refrigeration solutions. CARRIER experts provide sustainablesolutions, integrating energy-efficient products, building controls, and energyservices for residential, commercial, retail, transport and foodservice customers.Founded by the inventor of modern air conditioning, CARRIER improves the worldaround us through engineered innovation and environmental stewardship.CARRIER is a unit of UNITED TECHNOLOGIES CORP., a leading provider to theaerospace and building systems industries worldwide.

Source:www.businesswire.com

4 Canada's New Budget Fail to Pass - Highlights

23 March 2011-- Finance Minister Jim Flaherty has delivered a stay-the-coursebudget that holds the line on taxes, while offering a spate of tax credits to a widerange of groups and keeping to the plan of getting rid of the deficit by 2015-16.

Among the budget highlights:

On the economy:

No tax hikes or cuts, no major new spending programs and no substantial spendingcuts.

Keeps government on track for a balanced budget within six years through thecombination of economic growth and spending restraints. The end of the federalstimulus program, by itself, will cut the 2011-12 deficit to $27.6 billion from arevised $40.5 billion in 2010-11.

Economic growth (real gross domestic product) of 2.9 per cent, based on theaverage outlook of private sector economists.

Government acknowledging risk of global uncertainty by downgrading predictedgrowth in nominal GDP to $10 billion over previous year, from economists'projection of $20 billion.

For families and seniors:

A family caregiver tax credit of up to $300 for people caring for infirm spouses,common-law partners and children.

A tax credit on children's art programs, amounting to $75 on $500 spent

A top-up for the lowest third of seniors receiving the Guaranteed IncomeSupplement, up to $50 a month for singles and $70 a month for couples

For communities and cities:

Tax credit equal to $450 a year for volunteer firefighters in rural areas

Forgiveness of student loans of up to $40,000 for new doctors and $20,000 fornurses in remote and rural areas

Legislation to enshrine as permanent the annual $2 billion Gas Tax transfer formunicipal infrastructure

For business and workers:A hiring credit that provides a one-year EI break of upto $1,000 for 525,000 small businesses.

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Continuation of the temporary accelerated capital cost allowance on machinery andequipment

A "Helmets to Hardhats" program to help ex-military members to find work in theconstruction industry.

Elimination of mandatory retirement for federally regulated employees

Creation of 10 new Canada Excellence Research Chairs at universities and 30industrial research chairs at colleges and polytechniques

No change in plan to cut corporate taxes to 15 per cent by 2012.

Other initiatives:

Return —for one year —of the ecoEnergy Home Retrofit program  to encourageresidential energy efficiency

Renewal of the $22-million Own the Podium program to support elite Olympicathletes.

$100 million over five years for the Canadian Food Inspection Agency to improvefood inspection capacity.

Source:www.cbc.ca

23 March 2011-- Canada Budget Fails to Pass, Election Called

The Canadian House of Commons on Friday held a no confidence vote onConservative Prime Minister Stephen Harper. The passed measure brought downHarper’s government and has triggered an election in May. He has served asPrime Minister since 2006, although his party has always been in the minority.

P.M. Harper leads a minority government, which means he needed the support ofat least one of the opposition parties to get the budget passed. All three oppositionparties were against the budget and with the no-confidence measure, their budgetwill not be passed until after their elections.

Source:c-span.org

Environmental Spending Focuses on Green Homes

23 March 2011-- OTTAWA - Environmental spending in the federal budget focusedthe greenbacks on green homes.

The NDP had called on the Tories to renew the ecoENERGY Retrofit-Homesprogram and the government complied Tuesday —pouring an extra $400 millioninto the initiative.

But that wasn't enough for the party to come out in favour of the overall spendingplan, meaning the homes program and other green initiatives in the budget havelikely hit a red light.

The retrofit program offers rebates to help make homes more energy efficient andwas initially designed as a four-year program due to end this year. It proved to be apopular package for a government fending off accusations of ignoring theenvironment. The Tories topped it up in the last two budgets before deciding toextend it in this budget for another year.

The government had also hoped to look farther down the line when it came togreen programs.

The Conservatives allocated $35 million over five years to support climate changeand atmospheric research, and a further $58 million over two years for programs tohelp Canadians cope with the effects of climate change.

While Canada's actions on the environmental file are often pilloried around theworld, the government maintains that dealing with climate change is aninternational effort that can only work if all nations are on board. The budgetprovides $25 million over two years to continue with Canada's internationalengagement on the file, including work with the United States.

The government is hoping to reduce greenhouse gas emissions 17 per cent from2005 levels by 2020, and has focused on regulatory actions to achieve that goal.

"This approach will achieve real emissions reductions, while maintaining Canada'seconomic advantage and creating jobs for Canadians," the budget said.

Ottawa wanted to allocated $386 million over two years to pursue that course ofaction. The lion's share would go to regulations designed to address climatechange and air quality.

In total, $870 million was to be spent over two years on what the government callsthe "Clean Air Agenda."

But the Tories also stuck a green thumb into other pieces of the funding pie.

"Canada is increasingly looked to as a secure and dependable supplier of a wide-range of energy projects," the budget said.

Aboriginal and northern communities were given $8 million over two years inrenewed funding to promote clean-energy technologies, while a further $97 millionis being renewed over two years for generalized development of clean energy

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products.

Sustainable Development and Technology Canada, an arms-length governmentfoundation, was also to receive $40 million over two years to develop cleantechnology.

"This is an important message to the Canadian clean tech sector that thegovernment is helping them to be even more successful," said Vicky Sharpe,president and CEO of SDTC, in a statement.

Environment Minister Peter Kent has stressed that his portfolio isn't just aboutprotecting the environment but also celebrating it.

The budget includes the creation of a new national park in Labrador and funding forthe Great Lakes.

But the Green Party dismissed the all the efforts, saying that the budget didn'taddress Canada's ecological deficit.

“Overall, this ‘steady as she goes’ budget reflects the lack of imagination, vision orplan of this government," said Green Party leader Elizabeth May in a statement.

Source: www.360news.com

Ontario Budget Focuses on Cutting Deficit

29 March 2011-- Ontario Finance Minister Dwight Duncan unveiled hisgovernment’s 2011 budget Tuesday, forecasting a deficit of $16.3 billion for theyear ahead, with an election only seven months away.

As expected, this was largely a stay-the-course-budget, outlining little in the way ofnew spending or “pre-election goodies.”

Instead, Duncan unveiled a budget he said embodies the Liberals’ top twopriorities: maintaining core spending in health care and education while reducingthe deficit.

Duncan said the Liberals —who trail the opposition Progressive Conservatives inthe polls —opted to keep a lid on spending in a province that is not projected tobalance its books until 2017.

Duncan said the global recession of 2008 continues to cast a shadow overOntario’s finances.

“We’re running on getting the province back to balance,” said Duncan. “We’ve gotto do it in a responsible way, in a reasonable way and lay out a plan.”

Overall, government spending is projected to rise by only $1.2 billion in the nextfiscal year, to $124 billion in 2011-12.

With an economy showing moderate growth since 2008, Ontario’s deficit is forecastto fall next year and in subsequent years —to $15.2 billion in 2012-13 and $13.3billion in 2014-14.

The budget predicts a return to the black by 2017, but the province continues tocarry an overall total debt of about $236 billion.

Tuesday’s budget did include some new spending measures, but they were small-ticket items: 60,000 more post-secondary education spaces by 2016-16, a newmental health and addictions program targeted at children and youth, and 90,000more breast cancer screening exams.

With little new money to spend, the budget outlines a plan to find savings, trimming3,400 Ontario public service positions, closing inefficient jails and mandating that allprovincial agencies cut a combined $200 million.

Progressive Conservative Leader Tim Hudak said the budget does nothing to helpOntarians struggling to cover rising household costs on everyday items, such aselectricity.

“Today Premier Dalton McGunity had the chance to deliver the kind of relief Ontariofamilies desperately need. He failed to do so,” said Hudak. “We need to make lifemore affordable for everyday average families.”

The Tories have floated the idea of a one per cent cut to the harmonized sales tax,which the Liberals argue would reduce government revenue by about $3 billion.

“How many teachers are you prepared to lay off?” Duncan asked when theprospect of an HST cut was raised on Tuesday. “We’ve made solid investments.They are vital for a growing and more productive economy.”

NDP Leader Andrea Horwath said the budget “delivers a status quo that isn’tworking” and fails to offer any measures that will directly help most Ontarians.

The NDP wanted to see the HST removed from hydro and home heating bills and acommitment to reduce corporate tax cuts.

“They could have made life more affordable for families,” Horwath said. “They’restruggling to keep up while the premier claims the status quo is working.”

Derek Burleton, an analyst with TD Bank Financial, reviewed the budget and saidthe Liberals appear to be making a stand on their fiscal record, as opposed to newspending programs.

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“They’re making a concerted effort here to be seen as strong stewards of theprovince’s finances —which is appropriate given the size of the deficit.”

Burleton said the government’s commitment to debt reduction is sound butOntario’s large outstanding debt —which will peak at 40 per cent of the province’sgross domestic product in 2014-15 —leaves it vulnerable to economicuncertainties.

“There’s no magic level of debt and this is at the higher end,” Burleton said.

29 March 2011-- www.cbc.ca

UBBINK Launches Integrated Thermal & PV Roof

14 March 2011-- UBBINK, a U.K.-based supplier of heating, ventilation, roofingand building products, has introduced the Energy Roof, which integrates solarthermal collectors and PV modules onto a residential roof.

Ubbink says its specially developed slimline thermal collectors are only 42 mm high- the same height as the product's PV modules. The product also featuresmatching weatherproof and fade-resistant dummy panels to fill in any gaps andimprove aesthetics. In addition to the integrated arrays and panels, Energy Roof includes an easilyinstalled mounting roll, aluminium finishing pieces for edges and ridges, andinverters and cabling for PV, the company notes.

Source: UBBINK

Oil Rises Above $106

24 March 2011-- Oil prices rose above $106 a barrel Thursday in Asia amid awave of violent protests and uprisings in the oil-rich Arab world.

Benchmark crude for May delivery was up 29 cents at $106.04 a barrel at lateafternoon Singapore time in electronic trading on the New York MercantileExchange. The contract added 78 cents to settle at $105.75 on Wednesday, thehighest close since Sept. 26, 2008.

In London, Brent crude was up 8 cents at $115.55 a barrel on the ICE futuresexchange.

Oil has jumped 24 percent since Feb. 15 as violent conflict roils the Middle Eastand North Africa.

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Israeli warplanes hit Hamas targets in Gaza early Thursday, retaliating for rocketattacks on Israeli cities and a bus stop bombing in Jerusalem a day earlier.

Coalition missiles strikes have pounded forces loyal to Libyan leader MoammarGadhafi for five days, giving rebels breathing room to regroup. With Gadhafirefusing to step down and U.S. President Barack Obama ruling out a land invasion,the conflict could face a stalemate that keeps most of the OPEC nation's 1.6 millionbarrels a day of crude production shut down longer than investors had initiallyanticipated.

In Syria, a crackdown on anti-government protests escalated Wednesday as policekilled at least 15 demonstrators in the southern city of Daraa. Meanwhile, Yemendeclared a 30-day state of emergency in a bid to quell an expanding uprisingagainst the 32-year rule of President Ali Abdullah Saleh.

Crude prices were also lifted by signs U.S. consumers aren't letting rising fuel costscrimp demand. The Energy Department said gasoline inventories fell 5.3 millionbarrels last week, and gasoline stocks are down 8.9 percent during the last fiveweeks.

"The bulls got themselves into a tizzy because of the reported draw in gasoline,"energy consultant The Schork Group said.

In other Nymex trading for April contracts, heating oil added 1.2 cents at $3.07 agallon and gasoline gained 0.3 cent to $3.02 a gallon. Natural gas jumped 3.5cents to $4.37 per 1,000 cubic feet.

Source: www.wlfi.com

Americans Want Focus On Renewables, Not Nuclear

23 March 2011-- The nuclear disaster in Japan has triggered a strong responseamong Americans, a majority of whom would freeze new nuclear powerconstruction, stop additional federal loan guarantees for reactors, shift away fromnuclear power and toward wind and solar power, and eliminate the indemnificationof the nuclear power industry from most post-disaster clean up costs. These findings were uncovered by a new survey conducted by ORC Internationalfor the nonprofit and nonpartisan Civil Society Institute (CSI). Conducted March 15-16, the national opinion survey of 814 Americans also foundthe following: Over half (53%) of Americans would now support "a moratorium on new nuclearreactor construction in the United States," if "increased energy efficiency and off-the-shelf renewable technologies such as wind and solar could meet our energydemands for the near term."

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A total of 73% of Americans do not "think taxpayers should take on the risk for theconstruction of new nuclear power reactors in the United States through billions ofdollars in new federal loan guarantees." Additionally, 74% of Americans wouldsupport "a shift of federal loan-guarantee support for energy away from nuclearreactors" in favor of wind and solar power. Over three out of four (76%) Americans say they are now "more supportive than…a month ago to using clean renewable energy resources - such as wind andsolar - and increased energy efficiency as an alternative to more nuclear power inthe United States."  In fact, nearly half (46%) of all Americans now say they arenow "much more supportive" of relying on more clean energy and energy efficiencythan they were a month ago. "The Japanese crisis is an opportunity for America to make smarter choices aboutenergy, and that process should start with a recognition that the problems withnuclear power cannot simply be ignored in the wake of the tragedy at Fukushima,"says Pam Solo, founder and president of CSI.

Source: www.solarindustrymag.com

Differing Interpretations Of Housing Market Remain

28 March 2011 --February's low numbers are causing some to call a double dipwhile others write them off as a blip.

There seem to be two voices leading the debate on the state of the housingindustry.

While one camp of observers is raising the alarm that the industry’s numbers arethe lowest they’ve ever been and warning that a double-dip has hit the industry, thesecond argues that nothing is as bad as it seems. Between the bad weather andthe now-gone home buying stimulus, the argument goes, numbers look worse thanthey are.

Pending home sales numbers, released today by the National Association ofRealtors, are the latest example. Nationally, contracts signed in February rose2.1% compared to January’s numbers, landing at a reading of 90.8. On an annualbasis, the index fell 8.2%.

When broken down by region, the data do seem to have something to do with theweather. The Northeast, which had some of the worst snowfall on record in manyplaces, was the only region to drop for the month, falling 10.9% from the previousmonth. Meanwhile, the South, Midwest, and West all saw gains from January,improving 2.7%, 4.0%, and 7.0%, respectively.

And while weather patterns can’t explain the year-over-year declines in contractsignings that hit three of the four regions—the Northeast was down 18.4% fromFebruary 2010, the Midwest was down 15.9%, and the South was down 5.3%; theWest gained 0.6%—the home buyer tax credit was still in place this time last year.

But even if these numbers aren’t as bad as they look, they still aren’t good. The factthat contracts for homes are inching up from some of the lowest levels on recordstill leaves pending sales rates in the dumps.

And, unfortunately, that’s where many economists expect them to stay for a while.  “I was expecting a bounce-back in February,” Patrick Newport, U.S. economist atIHS Global Insight, told Builder. “The numbers in February were just awful. …Myreading is that the housing market for builders is about as bad as it’s been since1946, because the data says that. They’re not selling homes.”

Newport attributes the continually dismal figures to the fact that home prices arestill declining and the lack of available credit to builders. As to when pricing mightpick up again, “no one can predict housing prices very well,” he says. “What wewere anticipating was that demand for homes would pick up as the job marketpicked up. But so far, that hasn’t happened.”

While Wayne Yamano, vice president at John Burns Real Estate Consulting,agrees that an accurate prediction of the bottom has become elusive, he takesissue with some of the numbers that have given the industry’s status a bad namerecently.

“The Census showed that February’s numbers were dramatically lower. We don’tthink that’s the case,” he told Builder. While the Census bases its numbers on datafrom a survey of 900 of the 19,000 permit issuing places in the U.S., John Burnscollected its own data for February’s sales based on 225 ratings by 197builders—and found an uptick.

Yamano reports that many builders had a good month in February, mainly fueledby price discounts. “A lot of builders seem to be trading their margins for volume,”he said.

So with conflicting reports about the state of the industry and no consensus ofwhen the downturn will be, what’s a builder to do?

According to Bob Schultz, president and CEO of Bob Schultz &The New HomeSales Specialists, take stock. “The market conditions are what they are, whateverthey are,” Schultz told Builderin a phone interview. “If a builder is stuck with a badproduct or bad locations, they’re not going to do well ever.”

Emphasizing that national numbers are far less relevant to local builders thanwhat’s going on in their local market, Schultz encourages his clients to look at whatthey would do if they could start over fresh. He tells builders to inventory where

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their company stands relative to their local market, taking into consideration supplyand demand, where pricing stands, and especially what the resale market is doing.Those numbers, he contends, will allow companies to make an honest assessmentof how well their product fits into what the market is calling for, and if it's not fittingin well, builders should rework their plans and pricing.

He also recommends taking stock of the company’s salesforce to make suresalespeople are trainable and motivated. And to make sure salespeople areavailable to prospects, he tells builders to focus on what’s convenient for thecustomer, rather than for the builder, such as opening models during hours whenpeople are out shopping.

“I suggest that it’s not about the market or the market conditions in the finalanalysis that really matters,” he said. “It’s what you as a builder and what yoursales organization does that matters.”

Source: www.builderonline.com

Reheated Proposals

30 March 2011-- For 40-odd years now, Barack Obama lamented earlier thismonth, American politicians have banged on endlessly about the evils of America’sdependence on imported oil, without doing very much about it. It was time, hedeclared, to change that. Today he unveiled a package of initiatives that would cutAmerica’s oil imports by a third within a decade, according to the White House.Unfortunately, however, Mr Obama’s latest initiative seems doomed to go the sameway as all the brave talk from his predecessors.

Mr Obama’s plan has four main strands: increasing domestic production of oil,boosting output of biofuels as a substitute, encouraging the use of natural gas as atransport fuel, and making vehicles more efficient. He also chucked into the mix his“clean energy standard”, a scheme to promote less polluting forms of electricitygeneration, even though it has nothing to do with oil imports.

None of this is new. The clean energy standard was first wheeled out in his state-of-the-union address, and is anyway only a rehashed version of a much olderproposal to promote renewable energy, with nuclear power and natural gas boltedon to broaden its appeal. The administration was already working on a fresh seriesof ever more demanding fuel-efficiency standards for vehicles for when the currentlot runs out, in 20172016. Mr Obama had also previously pledged to nurture thecurrent growth in domestic oil production, to counter Republican cries of “Drill,baby, drill.” The government has been subsidising biofuels for decades, and theDepartment of Energy is already lending money to the sort of high-tech buthandout-dependent plants that the president wants more of. Even talk ofencouraging natural-gas vehicles is nothing new: T Boone Pickens, an irrepressibleoilman, has buttonholed half of Congress, and anyone else who will listen, on thesubject.

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Worse, those parts of the president’s plan that need congressional approval—theclean energy standard, more subsidies, extra funding for research on whizz-bangenergy technology—will never receive it. The Republicans who control the Houseare dead-set against anything that smacks of greenery, not to mention anythingthat would add to spending at a time when they’re trying to take an axe to it. Theyhave already ruled out the president’s signature energy policy: a cap-and-tradescheme to reduce emissions of greenhouse gases. They are also trying to rein inthe Environmental Protection Agency. The best the president can hope to do ishold the line, and preserve the EPA’s existing authority. So it is hard to see his half-baked, reheated list of proposals as anything more than a reassurance to theenvironmentally-minded, and to Americans fretting about rising fuel prices, that thepresident feels their pain—unlike those nasty Republicans.

Source:www.economist.com

March Unemployment at 8.8%

1 April 2011-- The U.S. economy added more jobs than forecast in March and theunemployment rate unexpectedly declined to a two-year low of 8.8 percent, a signthe labor- market recovery is gathering speed.

Payrolls increased by 216,000 workers last month after a revised 194,000 gain theprior month, the Labor Department said today in Washington. Economists projecteda March gain of 190,000, according to the median estimate in a Bloomberg Newssurvey. A separate report today showed manufacturing expanded at close to thefastest pace in seven years.

U.S. stocks climbed and the dollar strengthened as the report showed the world’slargest economy is weathering the highest energy prices in more than two years.Record exports and gains in business and consumer spending are promptingcompanies like Chrysler Group LLC and Kohl’s Corp. (KSS) to boost staff,underlining the Federal Reserve’s assessment last month that the recovery is on a“firmer footing.”

“It’s certainly indicative of continuing improvement in the labor market, with twomonths in a row of really solid private payrolls,” said Stephen Stanley, chiefeconomist at Pierpont Securities LLC in Stamford, Connecticut, who forecast a gainof 210,000 jobs. “It’s not a blow-out number but all in all, it’s a good report.”

Manufacturing expanded in March at about the same pace as February, thestrongest month since May 2004. The Tempe, Arizona-based Institute for SupplyManagement said its manufacturing index was little changed at 61.2 in Marchcompared with 61.4 a month earlier. Readings greater than 50 signal expansion.The median forecast of 79 economists surveyed by Bloomberg News was 61.1.

Stocks Gain

The Standard &Poor’s 500 Index gained 0.8 percent to 1,336.13 at 10:26 a.m. inNew York. The dollar strengthened to 84.53 yen per dollar from 83.13 yen lateyesterday. The yield on the 10-year Treasury note rose to 3.48 percent from 3.47percent.

Payroll estimates in the Bloomberg survey of 83 economists ranged from gains of150,000 to 295,000. February was revised up from a previously reported gain of192,000, while January payrolls increased 68,000 after a prior estimate of 63,000.The unemployment rate was projected to hold at 8.9 percent, according to thesurvey median.

The jobless rate dropped from 8.9 percent in February, the fourth straightdecrease.

‘Still Tenuous’

Fed Bank of New York President William Dudley said the recovery is “still tenuous”and is “still far from the mark” of the central bank’s goals of price stability and fullemployment, indicating today’s payrolls report is unlikely to change the Fed’s plansto buy $600 billion of Treasuries through June.

“We must not be overly optimistic about the growth outlook,” Dudley said today inthe text of remarks in San Juan, Puerto Rico, after the payrolls report. “A strongerrecovery with more rapid progress toward our dual mandate objectives is what wehave been seeking. This is welcome and not a reason to reverse course.”

The Fed, after its latest policy meeting March 15, pledged to continue its programof bond purchases in order to “promote a stronger pace of economic recovery.”Policy makers acknowledged a rise in commodity prices, signaling deflation riskhad diminished and they were unlikely to expand the bond purchase plan.

Bill Gross, manager of the world’s biggest bond fund at Pacific InvestmentManagement Co., said the gain in employment suggests the Fed’s policy isworking.

Relay Race

“Their objective obviously is to improve the economy and to create jobs but also toput a floor under the stock market, and we know that’s working,” Gross said in aradio interview on “Bloomberg Surveillance” with Tom Keene. “The questionremains, when the Fed stops buying Treasuries, does the private sector take thebaton and run the last leg of the relay race? We have doubts as to whether thatremains the case.”

Private hiring, which excludes government agencies, rose by 230,000 in March,more than the median 206,000 median forecast in the Bloomberg survey, after a

240,000 increase in February. The back-to-back gain was the biggest sinceFebruary-March 2006.

Chrysler, aiming for its first net profit since emerging from bankruptcy in 2009,plans to hire 1,000 engineers and high- tech workers for its small and midsizedvehicles. The Auburn Hills, Michigan-based company is also urging its dealers tohire more salesmen and service workers to help boost sales by 32 percent thisyear.

Spring Market

“Hiring additional personnel in preparation for the spring market is essential forsuccess in 2011,” Peter Grady, vice president of Chrysler’s network developmentand fleet, said in a memo to dealers last month.

Kohl’s said this week that it plans to open a new e- commerce distribution center inEdgewood, Maryland, in July and hire 1,200 workers over the next three years.

While companies stepped up hiring, earnings and hours stagnated. Average hourlyearnings held at $22.87 in March, today’s report showed, while the average workweek for all workers stayed at 34.3 hours.

The separate survey of households showed the size of the labor force increased by160,000 in March and employment grew by 291,000. That pushed the share of thepopulation in the labor force up to 58.5 percent from 58.4 percent a month earlier.

Government payrolls decreased by 14,000 last month reflecting cuts at the locallevel. Federal government employment rose by 1,000. Factory payrolls increasedby 17,000 last month, less than the survey forecast of a 30,000 gain.

Service Providers 

Employment at service-providers rose 185,000 in March, the most since May 2010.Temporary-help services companies added 28,800 workers last month. Health careand leisure and hospitality businesses also boosted payrolls. Construction payrollsfell 1,000 and retail trade employment increased 17,700.

The March jobs reading is likely be the first of the year that wasn’t skewed byweather. Winter storms constrained payrolls in January, prompting a Februaryrebound when temperatures were closer to normal for the month.

Economic growth accelerated to a 3.1 percent annual rate in the fourth quarter of2010 as consumer spending climbed by the most in four years.

Oil prices that closed at $106.72 yesterday, the highest since September 2008,may keep climbing should Middle East political turmoil continue unabated, raisingthe risk that consumer spending will slow in coming months.

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Japan Earthquake

U.S. companies are still trying to gauge the effects of the March 11 earthquake inJapan and the subsequent nuclear crisis on international supply chains. ToyotaMotor Corp. expects assembly interruptions that may affect North America plants.

The so-called underemployment rate -- which includes part- time workers who’dprefer a full-time position and people who want work but have given up looking --fell to 15.7 from 15.9 percent.

The report also showed an increase in long-term unemployed Americans. Thenumber of people unemployed for 27 weeks or more rose to 45.5 percent of alljobless.

Source:www.bloomberg.com

FUJITSU GENERAL to Launch VRF Systems in NA

February 2011-- FUJITSU GENERAL is entering the North American commercialair conditioning market this year. The company has announced that it will introducenew range of commercial models in the North American market. In the second halfof 2011, the company will release VRF system models for office buildings andcommercial facilities designed specifically to North American specifications. Thismove is intended to expand its North American product offerings and stimulatedemand.

Source: www.ejarn.com