Continued demand abroad, regulations at home will lift industry demand
Los Angeles, CA (PRWEB) October 05, 2012
The Automatic Fire Sprinkler System Manufacturing industry has experienced inconsistent revenue flow over the past five years. The bursting of the US housing bubble in the late 2000s hurt demand for automatic fire sprinkler systems. In 2009 alone, revenue plunged 23.6%, with commercial and residential construction having experienced a subdued construction since then. On the positive side, the industry pulled itself out of its recession-induced slump in 2010 as manufacturers focused on supplying automatic fire sprinkler systems to growing export markets. As industrial activity continues to increase over 2012 and US construction markets manage some improvement, industry revenue is expected to jump 3.1% to $285.2 million, IBISWorld industry analyst Nima Samadi says. Over the five years to 2012, revenue is estimated to fall at an annualized rate of 1.3%.
Export demand helped lift the industry into positive territory in 2010: automatic fire sprinkler systems and parts exports soared 15.1% to $117.5 million, Samadi says. Foreign developing markets where construction activity has continued to escalate strongly have been accounting for an increasing share of Automatic Fire Sprinkler System Manufacturing industry revenue. International construction demand is expected to continue growing strongly over the next five years. As more developing and newly industrialized countries grow and attract foreign investment into major metropolitan areas, construction activity abroad will create demand for automatic fire sprinkler systems. IBISWorld estimates that exports will increase at an annualized rate of 2.8% over the five years 2012 to $145.4 million.
A more stringent regulatory environment will also drive demand for industry products. States are beginning to adopt the 2009 version of the international residential code, which mandates that fire sprinklers be installed in new single-family homes. This should encourage more residential home builders to install sprinkler systems in the homes they are constructing, increasing demand for automatic sprinkler systems.
The long-awaited recovery of US construction markets is expected to gain traction in 2013. Further economic improvement will decrease unemployment, increase consumer and business spending, and create robust demand conditions for new office buildings, retail locations, factories, hotels, apartments, and other structures that typically contain automatic fire sprinkler systems. Over the five years to 2017, industry revenue is forecast to grow. The Automatic Fire Sprinkler System Manufacturing industry has a high level of market share concentration, with a small number of national and regional manufacturers. For more information, visit IBISWorld’s Automatic Fire Sprinkler System Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
This industry manufactures fire-protection systems that use automatic sprinklers. These systems typically consist of a network of pipes connected to a building's water supply. Industry products include devices that detect fire and automatically release water to combat the flames.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
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