Durable Goods Orders Fall 1.4% in February as Aircraft Bookings Plunge 28.6%

New orders for manufactured durable goods fell 1.4% in February 2026, dropping $4.4 billion to $315.5 billion — the fourth decline in the last five months. The headline weakness was almost entirely a transportation story: nondefense aircraft orders collapsed 28.6% in the month, erasing the demand registered in prior periods when Boeing's order book had been running hot. Strip out transportation entirely, however, and the picture looks considerably more constructive, with orders rising 0.8% — a signal that the underlying manufacturing economy is not deteriorating.

Transportation Distortion: Reading Through the Noise

Transportation equipment orders fell 5.4% to $106.1 billion in February, marking the fourth decline in the last five months for that category. The culprit was nondefense aircraft and parts, which plunged 28.6% — one of the sharpest single-month drops outside of the pandemic-era collapse in April 2020. For context, the series has historically swung between +80.4% (July 2014) and -45.4% (April 2020), so large monthly moves are structurally embedded in this data. The February reading follows a period of elevated bookings: nondefense aircraft orders had surged 26.9 billion in January before giving back much of that gain.

Motor vehicles told a different story.

• Auto and parts orders rose 3.1% to $70.8 billion — a meaningful offset within transportation that suggests auto demand remained firm even as the aircraft cycle corrected.
• Defense aircraft orders also edged down 3.8%,
• but defense capital goods overall slipped just 1.1% to $15.9 billion, a comparatively minor drag.

Core Capex: The Signal Beneath the Noise

For GDP trackers and business investment analysts, the number that matters most is nondefense capital goods orders excluding aircraft — the proxy for corporate equipment spending that flows directly into the GDP accounts. That figure rose 0.6% in February to $79.4 billion, following a revised 0.4% dip in January. The back-to-back readings — a small decline followed by a small gain — suggest the capex trend is essentially flat rather than accelerating or contracting.

On a year-to-date basis, nondefense capital goods orders excluding aircraft are running 4.2% above the same period in 2025, which places the trend in positive territory even if the monthly momentum has cooled from the stronger readings seen in mid-2025. Shipments in this category rose 0.9% in February, meaning realized equipment revenues are tracking slightly ahead of new bookings — a configuration that is neutral to mildly positive for near-term production.

Broader nondefense capital goods orders (including aircraft) fell 7.4% to $92.9 billion, but this figure is dominated by the Boeing effect and should be discounted accordingly.

Manufacturing Breadth: Strength Beyond the Headlines

The sector picture outside of transportation was broadly positive:

• Primary metals: Orders rose 2.2%, likely reflecting front-running of tariff-related input costs as manufacturers sought to lock in metal prices ahead of potential policy changes.
• Machinery: Orders gained 1.5%, extending a trend of solid demand from industrial equipment buyers. Machinery unfilled orders have risen for seven consecutive months, reaching $146.0 billion — a durable signal of sustained pipeline demand.
• Fabricated metal products: Orders edged up 0.5%, adding to a modest but consistent uptrend.
• Computers and electronic products: Orders were essentially flat, unchanged at $28.2 billion, following a 0.8% gain in January.
• Electrical equipment, appliances, and components: Orders dipped 0.1%, a negligible move.

Shipments — which represent realized manufacturing revenue — rose 1.3% to $319.2 billion, up five of the last six months. Transportation equipment shipments climbed 1.6%, with motor vehicle shipments up 3.0%, even as new orders for that category reflected the aircraft pullback. The divergence between strong shipments and weaker new orders is worth watching: if it persists, it would indicate manufacturers are working down existing backlogs rather than building new ones.

Backlog and Inventory: Pipeline Remains Intact

Unfilled orders — the production pipeline — rose 0.1% to $1,539.3 billion in February, extending a remarkable streak: backlogs have now increased in 19 of the last 20 months. The persistence of this trend, even as monthly new orders fluctuate, reflects the long-cycle nature of aerospace and defense contracts that dominate the backlog. Total inventories also edged up 0.1% to $595.7 billion, rising for five consecutive months, with computers and electronic products leading the build.

Year-to-date new orders across all durable goods are running 8.1% above the same period in 2025, and nondefense capital goods orders are up 12.3% year-to-date — figures that underscore the gap between the volatile monthly prints and the underlying annual trend.

GDP Implications and What to Watch Next

February's durable goods report delivers a mixed but not alarming signal for first-quarter GDP. The 0.6% gain in the core capex proxy (nondefense capital goods ex-aircraft) is consistent with modest positive equipment investment, though not the kind of acceleration that would materially lift the GDP growth estimate. The strong shipments figure — up 1.3% — is more directly relevant to GDP measurement, as shipments feed into the equipment investment calculation in the national accounts.

The next read on this series will be the advance report for March 2026, scheduled for release on April 29. The critical data point to watch: whether nondefense capital goods orders excluding aircraft can sustain or build on February's 0.6% gain, or whether the flat January–February trend solidifies into a broader capex slowdown that would weigh on the second-quarter GDP equipment investment line.