The Chinese market for AC and DC drives grew by an estimated 18.6% between 2004 and 2005, to achieve sales worth $860m. In a new report, the market analyst IMS Research says that the biggest growth came in the standard and premium AC drives sectors, especially at the high-power end. Many of these drives are being used in construction-related applications to expand China`s booming manufacturing and logistical infrastructure.

Almost every major multinational drives supplier is now active in the Chinese market, tempted by its vast size and by the 8% growth rate in the nation`s gross domestic product.

"These global companies have brought with them competitive advantages such as more reliable and technically superior drives, that have enabled them to dominate this market," says IMS analyst, Steve Lam. "However, these drives come with a higher price premium and have recently allowed indigenous companies to gain market share by competing in their own niche economy drives market."

In addition, the growing income of the Chinese people is helping to propel the lower power drives segment. As increasing numbers of Chinese consumers can afford packaged consumer goods, demand is growing for drives for use in food, beverage and packaging machinery applications.