Reduced production levels lowered the need to invest in new hydraulic machinery
Los Angeles, CA (PRWEB) May 01, 2012
The Hydraulic Motor Manufacturing industry was set back by the global economic recession, which weakened demand for hydraulic machinery used in a variety of industrial and aerospace applications. Says IBISWorld industry analyst Andrea Alegria, “Hydraulic motors are important components in larger hydraulic mechanisms that are commonly used in construction, mining and agricultural equipment,” for example, excavators, skids, forklifts, heavy dumper trucks, bulldozers and more. Hydraulic motors and pumps are also used in manufacturing processes across a wide spectrum of industries and are also common in commercial and military aircraft.
As the global recession hurt most of the Hydraulic Motor Manufacturing industry's downstream markets, revenue declined at an average annual rate of 2.7% to about $3.7 billion in the five years to 2012. “The industry was particularly hard hit by declines in construction machinery manufacturing resulting from the historic slump in construction activity,” says Alegria. “Across all industries, manufacturers of hydraulic machinery lowered or canceled purchases of hydraulic motors and pumps as surplus inventory levels grew due to weakened demand from end users.” Reduced production levels lowered the need to invest in new hydraulic machinery, which helped pull industry revenue down an estimated 17.4% in 2009. The industry rebounded in 2010, though, largely driven by exports as industrial and construction activity recovered faster in emerging economies. The strength of major export markets helped mitigate the fall in demand during the past five years and will continue to do so over 2012. Emerging economies such as China, which are bolstered by a growing middle class and urbanization, are experiencing increased consumer consumption of energy, durable goods, automobiles, rail and air travel, and are consequently bolstering demand for hydraulic-powered machinery used in those industries.
After a volatile five-year period, the industry will experience better conditions as the economy enters a period of stronger recovery and demand in the downstream construction sector improves. Technological improvements in hydraulic motors and pumps will also drive the industry forward during the next five years. The Hydraulic Motor Manufacturing industry is moderately concentrated. The large-scale players in this industry are able to generate such a large portion of total industry revenue due to the economies of scale that can be gained through high production levels. As a result, large multinational corporations dominate the industry. The smaller firms that comprise the rest of the industry typically operate on a regional level. In addition, they usually specialize in hydraulic system parts that serve a particular industry (such as aerospace vehicle parts or construction machinery). This way, they are able to build relationships with a small number of clients. For more information, visit IBISWorld’s Hydraulic Motor Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
This industry manufactures hydraulic pumps and motors. A hydraulic motor is a mechanical actuator that converts hydraulic pressure and flow into torque and angular displacement (i.e. rotation). The hydraulic motor is the rotary counterpart of the hydraulic cylinder. Hydraulic pumps, motors and cylinders can be combined into hydraulic drive systems.
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