American factories produced less in August than in July, snapping a seven-month streak of gains, according to Federal Reserve data released Friday. Manufacturing output fell 0.3 percent, driven largely by declines in motor vehicles and aerospace production.
The drop follows a 0.2 percent increase in July and marks the first monthly decline in manufacturing output this year. Even so, factory production remains 0.9 percent higher than it was a year ago.
Motor vehicles and parts led the slide, falling 1.2 percent after an 0.8 percent decline in July. Aerospace and other transportation equipment also fell 1.2 percent, wiping out most of the 1.4 percent gain the sector posted the month before. Together, autos and aerospace accounted for roughly half of the total manufacturing decline.
Vehicle assembly lines slowed for a third straight month. Automakers built cars and trucks at a seasonally adjusted annual rate of 10.43 million units, down from 10.81 million in July. Both car and truck production fell.
The weakness wasn’t confined to Detroit and Boeing suppliers. Manufacturing output excluding motor vehicles and parts still fell 0.2 percent, and durable goods manufacturing overall dropped 0.5 percent.
Furniture makers saw output fall 1.4 percent. Nonmetallic mineral products dropped 1.1 percent. Plastics and rubber products fell 0.9 percent. Primary metals slipped 0.3 percent, and fabricated metal products edged down 0.1 percent.
Tech manufacturing also lost ground. Computer and electronic products output fell 0.5 percent, with computers and peripheral equipment down 1.4 percent and semiconductor production off 0.1 percent. Communications equipment bucked the trend, rising 0.8 percent. The Fed’s broader high-tech manufacturing measure was flat for the month but still sits 12.5 percent above where it stood a year ago.
Looking at production by end use, business equipment output fell 0.5 percent, defense and space equipment dropped 1.2 percent, and construction supplies declined 0.7 percent.
Not every sector retreated. Machinery production rose 0.5 percent, and food, beverage and tobacco output climbed 0.3 percent. Apparel and textile makers posted gains as well. Electrical equipment and appliance production held steady, and nondurable manufacturing overall was flat.
Total industrial production, which folds in mining and utilities alongside factories, was unchanged for the month. A 1.8 percent jump in utility output and a modest 0.1 percent gain in mining offset the manufacturing pullback.
Manufacturing capacity utilization, a measure of how much of the nation’s industrial capacity is actually being used, fell to 75.7 percent from 76.0 percent in July. That’s the lowest reading since March and sits 2.5 percentage points below the long-run average, the Fed reported.
