IMS Research has forecast the market for medium voltage (MV) motors to experience sub-par growth through 2015. This market, still in recovery stages after the global downturn, must now face unexpected challenges resulting from a slowing Chinese economy, the currently unfolding Eurozone debt crises, and a shaky U.S. economy entering a pivotal election year, according to IMS.
The global downturn affected the MV motors market most severely in 2010, with an estimated 15 percent global contraction during that year. A major driver of the market is the large projects business, which was held dormant for most of 2010 due to investors shelving plans, funds being frozen, re-allocated or cancelled. However, 2011 resembled a “bounce-back” year in the market with seemingly clear skies ahead. This rebound was led by the oil and gas and mining sectors, and to a lesser extent the chemical and petrochemicals sectors. IMS Research says these were among the few industry sectors to hit the ground running as the large projects business came back online in early 2011, experiencing double-digit growth and surprising most in the industry so soon after a major downturn.
“The oil and gas industry has seen major revenue growth during 2011 in the packaging and transport areas of the industry more so than R&D and new exploration,” said IMS Research Analyst Mark Meza, in a prepared statement.
In North America, hydraulic fracturing techniques have breathed new life into existing wells once thought tapped out, and this has acted to jump-start the sector coming out of the downturn. The global mining sector was also reignited during the year with gold, silver, copper, and pot ash mines reaping record profits. IMS Research says all this bodes well for emerging economies with significant oil and gas and mining sectors, including Australia, Canada, South America, the Middle East, and Africa.
Despite the gains in these sectors, IMS Research says the outlook for developed economies remains cloudy and uncertain as trouble in the global economy began to surface again in late 2011 and early 2012. China, a major producer and consumer of MV motors, has begun to show signs of a significant industry-wide slowdown that will affect the entire global market for these motors. The Indian market is also cooling off after years of sustained, healthy growth. The Eurozone debt crisis is expected to negatively affect the region’s industrial output for the short-term, with some European MV motor manufacturers fearing a unit contraction in 2012 and possibly 2013. These fears may be overblown, but warrant consideration as the region struggles to keep EU nations such as Spain, Portugal and Greece financially solvent. In addition to this, IMS Research says fears of a double-dip recession in the U.S. looms large for 2013.
Published in August 2012 Medium Voltage Motors – 2012 Edition, quantifies the expected turbulence in this global market through 2016. The report details the current state of the industry sectors which utilize MV motors, forecasting outperforming and underperforming sectors, as well as regional market performance and other trends affecting the global MV motor market. For more information, visit www.imsresearch.com.