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Eastern Europe beckons for gen-set vendors

A Frost and Sullivan product story
Edited by the Engineeringtalk editorial team Aug 23, 2007

Diesel gen-sets continue to be the mainstay of distributed power generation in Europe, especially for the stand-by application.

Various countries in Europe provide different opportunities for diesel gen-set vendors.

While the market in Western Europe is relatively mature, the Eastern Europe market is brimming with promise as rapid industrialisation and commercialisation create new opportunities.

Although the Western European market has been subdued, diesel gen-sets continue to be the mainstay of distributed power generation in Europe, especially for the stand-by application.

New analysis from Frost and Sullivan, European Diesel Gen-sets Market - Power Range, End-user and Competitive Analysis, finds that the market earned revenues of US $958.2 million in 2006 and estimates this to reach US $1195 million in 2013.

Increased construction activities of office spaces, retail outlets, malls and public/infrastructure development such as revamping of the transport infrastructure in Eastern Europe are expected to instigate growth in the prime power application sector.

"Increase in commercial infrastructure projects boosts the demand for power ranges between 75-375kVA and as the office spaces increase, the need for emergency or back up power will correspondingly increase", according to Frost and Sullivan Research Analyst Aarthi Balachandran.

"Eventually commercial infrastructure activities will enhance market prospects for stand-by applications as well".

Western Europe, however, is not witnessing any increase in commercial activities and hence the gen-set market for various power ranges is quite subdued.

The lead-time for various components such as alternators and engines is also increasing, directly affecting the manufacturing and delivery time of the gen-sets.

However, manufacturers can source alternators and engines at lower rates and try to cut down on the manufacturing costs, which will help in dealing with price-focussed competitors.

Further, manufacturers need to extend their product portfolios to suit changing power ranges as the end-user dynamics differs across the European region.

"Gen-set packagers must concentrate on various factors such as new products and markets, technological developments, end-user trends, product differentiation, distribution strategy and building favourable relationships with component suppliers, while devising strategies to compete in the market", reiterates Balachandran.

It is also essential to provide total maintenance, technical and after-sales support to customers.

By meeting customised demand and offering quality and reliable products at competitive prices, gen-set packagers can capture market share.

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