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LV motor sales to process sector are booming

02 January, 2019

Global sales of low-voltage motors to the process sector have been growing faster than those to the discrete industries, according to a new report from IHS Markit. It says that LV motor revenues from the process sector grew by 4% between 2016 and 2017, generating $3.7bn in revenues, and will reach $4.4bn by 2022.

In terms of global growth, the process industries outpaced discrete industries by around 1%, with the oil and gas, and water and wastewater, industries accounting for almost half of all LV motor sales to the process sector during 2017.

In 2016, the global LV motor market experienced a contraction. The process industries were hit the hardest, due largely to depressed oil prices and an oversupply in the projects business. In 2017, the market experienced a recovery, especially in the oil and gas sector, with the process industries growing faster than the discrete industries. This trend continued in 2018, with LV motor sales to the process sector thought to have expanded by 9.1% – compared to 6.1% in 2017.

Rising oil prices led to a strong rebound in the oil and gas industry, and large projects that had previously been put on hold have been given the go-ahead to capitalise on the growth. Most of the purchasing was for projects in the Middle East and the US.

LV motor sales to the water and wastewater industry have also experienced modest growth, with revenues expanding by an estimated 3.7% during 2017.

Half of the revenues from LV motors sold to process sector have been going to four vendors – ABB, Wolong, Siemens and WEG. Other players with a smaller, but “considerable”, presence include Regal Beloit and Nidec.

Droughts in Southeast Asia have boosted demand for motors for pumping applications in the region. Many motors have been bought to upgrade ageing irrigation systems.

Revenues and growth rates for the global low-voltage motors market
Source: IHS Markit

China continues to show strong growth in the water utility and recycling sectors, with a revenue growth of around 3.5% during 2017. North America and Western Europe, by contrast, have been lagging behind the global average. Most opportunities in these regions will come from the energy industry, because oil and gas plants need large amounts of water to operate.

Global sales of LV motors for metal processing applications grew by 2.3% in 2017, due largely to increased investment in Vietnam, Iran, Algeria, Qatar, Mexico and other expanding economies. India’s manufacturing sector is also experiencing growth, thanks to continued government infrastructure spending, which boosted construction and mining activities.

US tariffs on steel and aluminium imports have boosted demand for domestic steel, prompting American steel manufacturers to invest heavily in new equipment to keep up with demand. The future of US-imposed tariffs, and the sustainability of the recent growth in the US metal processing industry, remains uncertain, according to IHS Markit.

On the other hand, China has been suffering from closures of metal processing factories as a result of a crackdown by the Chinese Ministry of Ecology and Environment on facilities that do not comply with new environmental standards. Because China produces half of the world’s aluminium, the decline in production has stifled growth in the global metal-processing sector.




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