Steady growth for high-power AC drives worldwide
An
ARC Advisory Group product story
Edited by the Engineeringtalk editorial team
Jul 29, 2003
The worldwide market for high-power AC drives is expected to grow at a compound annual growth rate of 5.7% over the next five years.
The worldwide market for high-power AC drives is expected to grow at a compound annual growth rate of 5.7% over the next five years.
The market was a little over $2.5 billion in 2002 and is forecasted to be around $3.3 billion in 2007, according to a new ARC Advisory Group Study.
The need to reduce mounting energy costs is acting as the single most important driver in the worldwide high-power AC drives market.
"Increasing energy prices are compelling users to seek equipment, operating methodologies, and technologies that help them minimise energy consumption and save on energy costs", according to ARC Senior Analyst Himanshu Shah the co-author of "High-power AC drives worldwide outlook".
He further added: "High-power AC drives are favourably placed as they pay back their costs relatively quickly".
High-power AC drive suppliers, whose growth prospects are constrained by weak global economic conditions, found it expedient to expand market shares through acquisitions and mergers.
This development indicates the resolve of suppliers to explore ways of addressing market challenges.
The services component comprising of engineering, installation, and maintenance and such other services has emerged as contributing significantly to revenues of high-power AC drives.
According to the study, this trend will further strengthen.
Europe, largely driven by the Eastern European economies, continues to be the largest market for high-power AC drives.
The energy conservation legislation of many European countries also aids the growth of high power AC drives business.
While North America is a distant contender, Asia lives up to the reputation of emerging as a promising growth market.
The market benefited from investments in industrial segments such as oil and gas pipelines, power, and water and wastewater.
Companies find it relatively attractive to incur the capital expenditure on high-power AC drives because of its tangible energy saving potential and the market is set to grow.
Shah continued: "The long-term outlook for the high-power AC drives market looks positive despite the current state of the global economy".
High-power AC drives, states the study, is a mature product by technological standards, offering an attractive return on investment with practically no attendant risk, is widely applied, and this spurs the growth.
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