SIC 3534 Elevators and Moving Stairways

SIC 3534

This classification comprises establishments primarily engaged in manufacturing passenger or freight elevators, automobile lifts, dumbwaiters, and moving stairways. Establishments primarily involved in manufacturing commercial conveyor systems and equipment are classified in SIC 3535: Conveyors and Conveying Equipment, and those manufacturing farm elevators are classified in SIC 3523: Farm Machinery and Equipment.

NAICS CODE(S)

333921

Elevator and Moving Stairway Manufacturing

INDUSTRY SNAPSHOT

The elevator and moving stairway industry manufactures a series of products designed for the vertical transportation of both materials and passengers. Machines manufactured for the exclusive purpose of moving materials, such as freight elevators and automobile lifts, comprise a small niche of the wide-ranging materials handling market. The majority of company revenues are generated by manufacturing passenger elevators and escalators, producing parts required for elevator renovation and modernization, and servicing elevators.

The livelihood of this industry is based mostly on the well-being of the construction industry, since new buildings need new elevators. The demand for elevators in the United States in the late 1990s was fairly high, as the strong economy fueled the construction of new commercial and public buildings. In 2000, industry shipments were valued at $1.82 billion, up considerably from 1996 shipments of $1.1 billion.

ORGANIZATION AND STRUCTURE

One hundred ninety-five establishments were engaged in manufacturing elevators and moving stairways in 1997. Elevators and moving stairways accounted for 79 percent of total shipments, while parts and attachments produced for separate sale represented 21 percent. Electric and hydraulic passenger elevators—40 percent of the industry's total 1997 shipments—were the largest product groups within the industry. Automobile lifts—16 percent of the total figure—were the next largest group, followed by freight elevators, other types of non-farm elevators, and moving stairways and escalators—which each comprised less than 6 percent of total shipments.

Establishments in the elevator and moving stairway industry employed an average of 48 people each. Of the 195 companies operating in 1997, 58 percent (112 firms) employed fewer than 20 workers. However, 38 percent of all employees in the industry were concentrated in establishments employing more than 50 people. The greatest concentration of industry employees was in the Midwest and the East. Indiana was home to some 1,590 employees, followed by New York with 783 and Illinois with 761. Combined, these three states employed over one third of the industry's total work force, and housed over 17 percent of all companies.

In 1997, this industry as a whole spent more than $849.0 million on raw materials, which translated to about $4.4 million per establishment. New capital expenditures totaled $38.8 million for the industry as a whole, approximately $199,000 per establishment.

The application of modern technology to the elevator industry has also fostered greater competition among major contractors (who engaged in manufacturing new elevators as only a part of their operations) and smaller independent firms (who derived their business exclusively from the service market). In an effort to guarantee future service and renovation contracts on elevators they manufactured, many of the larger companies in the industry attempted to guard the technical data governing their elevators so that outside contractors lacking proper access codes would be unable to service their product. Although this form of proprietorship was frowned upon by governing organizations such as the National Association of Elevator Contractors (NAEC), the profit margin on new elevators—about 5 percent—encouraged companies to protect their large capital...