Revenue is forecast to increase 15% to 20%, with gross profit rising 25% to 30% while gross margins are expected to expand 150 to 200 basis points. Now let’s advance to Slide 7 to review the outlook for each of our major markets. According to ACT Research, the demand for the production of commercial vehicles is now expected to rise 7.3% to 625,000 vehicles during 2023 and for a softening of demand to occur in 2024, with production forecast to decline by 13.4% for the year before rising sequentially in each of the following 2 years. We believe that the potential exists to grow through the cycles, with momentum continuing to favor the reshoring of production to North America and within North America to Mexico. Turning now to Slide 8. The market for the transportation and use of natural gas is key for Sypris and has become increasingly dynamic over this past year.
European countries boosted LNG imports by 60% in 2022 to offset declining pipeline shipments from Russia. As part of the strategic response to their former dependency on Russia for the reliable supply of natural gas, Europe has embarked upon an aggressive campaign to source its needs elsewhere. The IEEFA forecasts that Europe will increase its LNG import capacity by 33% by the end of 2024 and that the global LNG market will see a tidal wave of projects coming online starting in mid-2025. The outlook projects — projects at the 64 million metric tons of annual liquidation — liquefaction capacity will be added by 2026. The U.S. is a major provider of LNG and became the world’s largest exporter in 2022, with plans to do even more in the future.
By way of illustration, the U.S. exported 10.6 billion cubic feet per day in 2022 and is forecast to export 13.3 billion cubic feet per day in 2024 and 22.5 billion cubic feet per day by 2027. The maps to the right depict the various projects underway in the U.S. and Europe, identifying those that are proposed, approved, under construction and in operation. The continued growth in our energy products backlog year-over-year reflects the strong and growing demand to support these infrastructure programs. We remain cautiously optimistic that this positive outlook will remain in effect for some time to come. As you will see from the chart on Slide 9, the long-term market of defense spending remains positive. And within the overall budgetary allocations, spending for technology upgrades at strategic platforms continues to be a very high priority.
Our backlog of business now stands at $109.5 million; that’s up 9% year-over-year with firm orders extending into 2025. We are very pleased with the level of new business momentum and we are optimistic that this important trend will continue going forward. During previous calls, we discussed the changes that have taken place in our market mix over the past several years. Turning now to Slide 10. Please note that revenue is forecast to increase 15% to 20% for 2024, with shipments to our customers and defense-related markets expected to increase significantly. As a result, defense electronics is forecast to represent 46% of consolidated sales in 2024, up from 33% in 2023. We believe that additional opportunity exists to further diversify our business and we will continue to aggressively pursue this outcome.
Now let’s turn to Slide 11 for a brief summary. Revenue for the quarter increased 33% while gross profit increased 105% and gross margins expanded 420 basis points despite the negative drag of the Mexican peso on our year-over-year results. The defense market should benefit from increased spending in fiscal 2024, with discretionary and emergency funding combining to exceed $1 trillion for the year. And within this overall expected spend, investments in electronic warfare, avionics and communications are forecast to rise disproportionately. As a result, we are pleased to issue our initial outlook for 2024, with revenue expected to increase 15% to 20% year-over-year. We expect gross profit to rise 25% to 30% while gross margin is forecast to expand 150 to 200 basis points for the year.
Turning now to Slide 12. Rich Davis will lead you through the balance of our presentations. Rich?
Rich Davis: Thanks, Jeff. Good morning, everyone. I’d like to discuss a few — some of the highlights of our third quarter and year-to-date financial results. Please advance to Slide 13. Q3 consolidated revenue was $33.6 million, an increase of 33% from the third quarter of last year. Consolidated gross profit was $4 million for the quarter, increasing 105% from the prior year quarter due to overall higher production and shipment volumes in both segments and favorable mix, offset by the impact of $0.8 million in unfavorable peso-to-dollar exchange rates. Revenue for Sypris Technologies increased 13.8% year-over-year to $19.3 million for the quarter. Gross margin was up 120 basis points from the prior year quarter due to the favorable mix, offset by the unfavorable peso-to-dollar exchange rate impact.
