3rd Quarter 2014

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Globally, Tennessee continues to feel the effect of Europe's economic doldrums.

Trade Report continued

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The automotive industry continued to lead the gainers. A steep fall in truck and heavy SUV shipments was more than countered by a very large rise in car and light SUV exports. As a result, total vehicle exports rose from $533 million to $602 million. Canada accounted for the lion's share of those gains, though China, Korea, and Russia (!) also saw significant upticks in Tennessee vehicle shipments. The odd Russian figure is presumably due to Volkswagen and its Russian auto plant. Automotive engine exports were up around 20% (to $200 million). With the exception of automotive instruments, most other auto-related goods also posted positive numbers.

Medical equipment and medical-related exports maintained their pole position as the state's largest export industry, although it was not a particularly good quarter. While pharmaceuticals (up $22 million to $144 million), medicaments, orthopedic goods, and artificial joints made gains, there were losses almost everywhere else in the sector. Surgical catgut fared the worst, with its exports falling from $136 million to $104 million.

The electronics sector fared better. Computer-product and telephony exports were both up over 10%. Electrical equipment was similarly strong, with shipments rising nearly 50% (from $83 million to $123 million). Tennessee's other major export industries, chemicals, synthetic fibers, aircraft (and parts), and regulating/ diagnostic instruments, did not experience much change from a year earlier.

Globally, Tennessee continues to feel the effects of Europe's economic doldrums. State exports fell about 2% in the euro zone (to $965 million). The big decline in cotton exports meant in general a poor quarter in Asia. China, however, shrugged off the cotton losses. Thanks to a variety of industrial sectors, notably including automobiles, Tennessee's total exports to China were up 6% (to $617 million). South Korea grew as well. Japan was another story. State exports there declined nearly $100 million, making it the state's poorest-performing large market. About half of the loss was in the medical sector (explaining that industry's weak quarter). The other half was due to a large decline in photovoltaic-cell (solar panel) sales. Despite plenty of churn in South America, with exports to Chile dropping while those to Colombia soared, overall the continent barely moved. Tennessee shipments in the third quarter of 2013 were $564 million; in 2014 they were just $8 million more.


Tennessee's Leading Trade Partners


trade weighted dollar index