Electrical Equipment Manufacturing in the US Industry Market Research Report from IBISWorld Has Been Updated
New York, NY (PRWEB) March 08, 2014 -- During the five years to 2014, the Electrical Equipment Manufacturing industry was forced to contend with increased competition from abroad and recession-driven declines in demand from downstream customers. Primary consumers of electrical equipment manufacturing products include industries involved in nonresidential construction (IBISWorld reports 23331 to 23332b) and manufacturing facilities. In 2009 and 2010, downturns in these sectors contributed to plunging industry revenue. Nevertheless, revenue has steadily risen since 2010, and is expected to increase at an average annual rate of 3.9% during the five years to 2014. As the economy recovers, demand from downstream industries is expected to continue stimulating industry demand. Revenue is expected to jump 5.4% in 2014 to reach $46.9 billion as industrial production and construction rates continue to increase.
According to IBISWorld Industry Analyst Sarah Kahn, “Despite improving downstream markets, industry sales have been slow to recover due to a loss of domestic market share to imports.” Import penetration has risen due to increased competition from countries with lower wages, which are able to manufacture industry products at lower costs. In response, many US-based companies have offshored production operations to lower-wage countries. Imports are estimated to satisfy 61.8% of domestic demand in 2014, compared with 40.0% in 2009. Increasing import penetration has led to plant closures and consolidations, as some domestic operators have been unable to compete with less expensive imports. Consequently, the number of establishments is expected to decline at an annualized rate of 0.4% to 2,248 in 2014. However, due to consolidations, factory closures and offshoring, overall industry profitability improved from 2009 to 2014.
Moving forward, environmental concerns will drive demand for industry products that are secure and energy efficient, presenting an opportunity for industry operators. “In the five years to 2019, domestic demand for industry products is forecast to increase, underpinned by rising demand for energy-efficient products and the need to replace aging electrical infrastructure,” says Kahn. Over the same period, exports are expected to rise at an annualized rate of 9.5%, further bolstering revenue. Export growth, however, will be somewhat offset by continued import penetration. Even in the event of this potential setback, industry revenue is forecast to grow over the next five years.
For more information, visit IBISWorld’s Electrical Equipment Manufacturing in the US industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld industry Report Key Topics
Electrical Equipment Manufacturing industry manufactures power, distribution and specialty transformers; electric motors, generators and motor-generator sets; switchgear and switchboard apparatus; relays; and industrial controls. Electrical equipment manufacturers sell their products to other manufacturing industries, wholesalers and the construction sector.
Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
Gavin Smith, IBISWorld, +1 310-866-5042, [email protected]
Share this article