Technovation 21 (2001) 709–717 www.elsevier.com/locate/technovation Recent trends in the export performance of US machine tool companies Ronald V. Kalafsky * , Alan D. MacPherson Department of Geography, Canada–United States Trade Center, University at Buffalo, Buffalo, NY 14261, USA Received 1 September 2000; accepted 10 April 2001 Abstract This paper examines the export characteristics of US companies in the machine tool (MT) industry. Aggregate data on the international competitiveness of this sector are compared with firm-specific data collected from a sample of 81 exporting firms. The results suggest that export performance correlates strongly with applied research and development (R&D) activity. The survey results also show that successful exporters are more likely to create new manufacturing jobs than their counterparts that treat foreign markets as secondary. Successful exporters are also found to exhibit faster rates of company growth. Despite the steady decline of the American MT industry since 1945, there is evidence that this sector is beginning to experience a technological and commercial recovery. The paper concludes with a brief discussion of the long-term resiliency of this rebound.  2001 Elsevier Science Ltd. All rights reserved. Keywords: Machine tools; Export strategy; Competitiveness 1. Introduction The US machine tool (MT) industry no longer domi- nates the world market as far as capital equipment is concerned. In terms of market share, for example, the US proportion of global production dropped from 55% in 1955 to less than 11% in 1999, whereas Japan’s share increased from 1 to over 22% (AMT, 2000). Machine tools that operate on a computer numerically controlled (CNC) basis represent the heart of the industry these days, yet the US is now the world’s top importer of CNC equipment. Today, in fact, import penetration within the CNC segment of the industry runs at almost 60%, com- pared to less than 30% 10 years ago (US Department of Commerce, 2000). Employment losses within the indus- try have also been substantial, in that over 50 000 MT jobs disappeared between 1980 and 1994. This said, there is growing evidence that a residual core of techno- logical competence remains within the US (Robinson, 1996 Stonecipher, 1997). Over the last 10 years, for * Corresponding author. Tel.: +1-716-645-2299; fax: +1-716-645- 2329. E-mail address: rvk@acsu.buffalo.edu (R.V. Kalafsky). 0166-4972/01/$ - see front matter  2001 Elsevier Science Ltd. All rights reserved. PII:S0166-4972(01)00049-9 instance, the average level of US export-intensity for many of the major classes of MT products increased by approximately 25%. During the 1990s, moreover, total US employment in this sector remained constant at around 59 000 jobs (a rare example of employment stab- ility for any US industry these days). Though the com- mercial and technological problems confronting this sec- tor have far from disappeared, evidence presented later suggests that MT production remains a viable activity within many US regions (including the traditional manu- facturing belt). Set against this backdrop, a major goal of this paper is to explore the main reasons for renewed interest in export markets by US manufacturers of finished MT pro- ducts (i.e. new complete machines). A further objective is to examine those factors that best discriminate between successful versus less successful exporters in this industry. Our evidence comes from a sample of 103 MT companies (including 81 exporters) that responded to a postal survey in the summer of 2000. Supplementary evidence comes from follow-up conversations with a subsample of company representatives, including several CEOs that participated in the International Manufactur- ing Technology Show (IMTS) in Chicago (September 2000). The empirical analysis is framed against a