CWIEME BERLIN 2016
MOTOR MARKET UPDATE
PRESENTED BY:
PRESTON REINE, SENIOR ANALYST
IHS MANUFACTURING TECHNOLOGY
www.coilwindingexpo.com/BERLIN
© 2016 IHS. ALL RIGHTS RESERVED.
© 2016 IHS. ALL RIGHTS RESERVED.
IHS Manufacturing Technology Presentation
Agenda
• Economic update
• Motor market statistics
• Key trends and challenges for
suppliers
• Conclusion
© 2016 IHS
DISCOVERING
MANUFACTURING TECHNOLOGY
INDUSTRIAL AREAS
Capital Equipment &
Machinery
Discrete & Process
Automation
Electric Motor Systems
Industrial analysts
across
8
locations worldwide
© 2016 IHS. ALL RIGHTS RESERVED.
Comprised of three dedicated research areas and
over 30 analysts covering electrical, electronic,
electromechanical, and mechanical automation
equipment types; as well as finished machinery and
equipment markets. By leveraging the breadth of
IHS and its experts, IHS’s insight into
manufacturing technology is unparalleled in key
vertical markets, including automotive, power
generation, oil & gas, maritime, amongst others.
Strategic
Planners
to
Procurement
Personnel
INFORMATION
ANALYTICS
EXPERTISE
Team of
25+
years of industry
coverage
30+
dedicated analysts
3
Global economic outlook
© 2016 IHS
4
Short term factors affecting the world economy
Systematic
factors
Structural
factors
© 2016 IHS
•
•
•
•
Withdrawal of policy stimulus
Over capacity after investment booms
Sluggish export markets
Increased risk aversion
•
•
•
•
Slower labor force growth
Slower pace of globalization
Falling commodity prices
Lack of market reforms
5
World GDP growth will stay flat, despite 2015
projections, with 3.1% growth in 2017.
Real GDP
Real GDP
5%
4%
3%
2%
1%
0%
-1%
-2%
Source: IHS
© 2016 IHS
Real GDP
© 2016 IHS
6
Emerging economies still struggling
Real GDP Growth - BRIC Countries
15%
Real GDP Growth
10%
5%
0%
-5%
-10%
Source: IHS
India
China
Brazil
Russia
© 2016 IHS
• India committed to rural development rather than business incentives
• Key overcapacity concerns loom large in China; lower commodity prices will continue through
2017
• Political issues in Russia and the Middle East are reverberating through the Eurozone.
Manufacturing PMI fell to its 7-month low in March 2016, and export orders declined for the 31st
consecutive month.
• Venezuela, Argentina and Brazil are in substantial recessions. The worsening political crisis will
extend the ongoing downturn in Brazil
© 2016 IHS
7
China’s investment-driven industrial expansion is
winding down
China Economic Figures
35%
30%
25%
20%
15%
10%
5%
0%
-5%
Source: IHS
© 2016 IHS
Real GDP
Industrial Production
Machinery Production
© 2016 IHS
Challenges:
Opportunities:
• Collapsing Commodity Demand
• More investment in robotics
• Overcapacity
• Automation penetration rate
• Stock Market Correction
• Factory capacity consolidation
8
Industrial automation equipment market update
© 2016 IHS
9
IAE 2015 and 2016 forecast comparison
$199.3B
$41.0 billion
Motors & Generators
$31.4 billion
$35.6 billion
Discrete Controllers
Rotary Products
$24.4 billion
$19.4 billion
Process Control
$30.1 billion
Motor Controls
2015 Equipment Revenue
M 32.8%
Motors & Motor Controls
$17.2 billion
A 34.2%
Automation Equipment
P
Power Transmission Equipment
33.0%
Switchgear
2016 Market Drivers
2016 Regional Sales Growth
Global GDP
2.7% Growth
Americas
2.2%
EMEA
1.2%
Rest of Asia
4.3%
China
3.1%
44.0%
IAE Sales into
Discrete Manufacturing
Japan
-2.1%
Machinery Production
0.1% Growth
Capital Expenditure
-0.1% Decline
© 2016 IHS
Linear Products
41.0%
IAE Sales into
Process Manufacturing
10
Industrial automation equipment market regional growth
Rest of
Asia
$22.3
EMEA
$60.8
(CAGR 15-18)
3.0%
China
$35.3
Japan
$15.9
(CAGR 15-18)
2.2%
(CAGR 15-18)
2.9%
$ 45.3 billion
$ 60.8 billion
$ 73.6 billion
Americas
EMEA
Asia Pacific
2018
$ 51.5 billion
$ 67.7 billion
$ 84.6 billion
CAGR
15-18
2015
Americas
$45.3
3.3%
2.7%
3.5%
World Market Revenue for IAE was $179.7 billion in 2015
© 2016 IHS
11
Key industry sector weight and performance in 2016
Industrial Automation Equipment Market by Industry
9%
8%
7.6%
6.8%
7%
6.2%
6.0%
6%
4.0%
37.9%
2.0%
Sector Growth
Proportion of Total IAE Market (%)
6.0%
8.4%
0.0%
4.9%
5%
4%
4.4%
3.7%
3.6%
-2.0%
3.4%
-4.0%
3%
-6.0%
2%
1%
-8.0%
0%
-10.0%
% of 2015 IAE
© 2016 IHS
2015 Growth
2016 Growth
© 2016 IHS
12
Machinery production growth profiles
50%
Total Machinery Production Percentage Growth Rates
25%
% Growth of machinery production measured in US $
2013
2014
2015
2016
2017
2018
2019
CAGR
2020 13 - 20
9.4%
0.5%
-1.8%
1.4%
-0.7%
1.6%
3.7%
3.4%
1.6%
-4.7%
4.1%
1.6% -19.2%
-0.9%
1.3%
2.5%
2.4%
-1.7%
China
5.7%
7.5%
6.4%
0.2%
-0.3%
1.4%
2.8%
3.0%
2.0%
Japan
1.4% -13.1%
1.2%
-5.5%
-1.1%
1.4%
2.1%
2.8%
US
Germany
1.4%
0%
-25%
US
Germany
China
Japan
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Percentage growth
rates of machinery
production in US $
-50%
© IHS 2016
Source: IHS; Industry Publications
50%
Total Machinery Production Percentage Growth Rates
% Growth of machinery production measured in US $
Americas
Europe
Asia
Pacific
2013
2014
2015
2016
2017
2018
2019
CAGR
2020 13 - 20
1.4%
-2.4%
-0.7%
0.4%
1.6%
3.3%
3.2%
3.5%
1.2%
1.8% -18.2%
0.9%
2.6%
3.1%
3.0%
2.9%
-0.9%
0.5%
-1.9%
1.9%
3.0%
6.4%
1.4%
1.4%
11.0%
-5.1%
5.3%
25%
0%
-25%
© IHS 2016
Source: IHS; Industry Publications
-50%
25%
Total Machinery Production Percentage Growth Rates
% Growth of machinery production measured $ and €
2013
2014
2015
2016
2017
2018
2019
CAGR
2020 13 - 20
Europe (€)
-1.8%
1.9%
-2.2%
0.9%
2.6%
3.1%
3.0%
2.9%
1.4%
Europe ($)
1.4%
1.8% -18.2%
0.9%
2.6%
3.1%
3.0%
2.9%
-0.9%
Source: IHS; Industry Publications
0%
-25%
© IHS 2016
Americas
Europe
Asia Pacific
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Percentage growth
rates of machinery
production in US $
Europe (€)
Europe ($)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Percentage growth rates
of European machinery
production. Comparison
of $ against €
-50%
© 2016 IHS
13
Industrial motor market insights
© 2016 IHS
14
Overview of industrial motor market
2015 forecast
unit shipments
World shipments by region (%)
178M
Top-3 Leading Suppliers
ABB
Siemens
Americas
28%
Asia
48%
EMEA
24%
WEG
Shipments CAGR (2015-2020)
Americas
2.2%
© 2016 IHS
Asia
3.0%
EMEA
1.1%
15
Global MEPS Timeline
World - Legislative Timeline: 1997-2020
US: earliest for IE2
US: Earliest for IE3/NEMA
IE1: China
IE2: US & Canada
IE2: S. Korea, Φ1
IE2: S. Korea, Φ2
IE2: Mexico
IE3/NEMA Premium : US
IE2: Australia
Europe
IE2: Brazil
IE2: European Union, Φ1
1997
2004
2006
2008
2009
2010 2011
China: follower
*Lot #30 Proposal*
European Union
0.75kW - 375kW
Exclusively IE3
European Union, Φ2
7.5kW - 375kW
IE2+VFD or IE3
IE2/GB3: China
Japan 'Top Runner'
IE3 or better
IE2: Turkey
IE3/NEMA Premium : Canada
2012
Source: IHS; IE4 Low-Voltage Motors - 2015
© 2016 IHS
European Union, Φ3
0.75kW - 7.5kW
IE2+VFD or IE3
IE3/GB2: China
2013
2015
2016
2017
2020
© 2015 IHS
16
Unit shipment growth by efficiency class
The World Market for Low Voltage Motors by Efficiency Class - Unit Shipments 2014 to 2019
25,000
20,000
Brazil
starts IE2
EU (Phase 3)
and China
start IE3 shift
EU (Phase 2)
and Japan
start IE3 shift
EU starts
IE2 shift
China
starts IE2
shift
Units (k)
15,000
US starts
IE3/NEMA
Prem ium shift
10,000
2015 and
beyond are
estimated
Canada starts
IE3/NEMA
Prem ium shift
5,000
0
200 9
Source: IHS
© 2016 IHS
201 0
201 1
201 2
IE1 - S tan dard Efficiency
201 3
201 4
IE2 - High Efficie ncy
201 5
201 6
201 7
IE3 - P remium Efficie ncy
201 8
201 9
© 2015 IHS
17
Low Voltage Motors Suppliers in the World
WORLD (major players)
•
•
•
•
•
•
•
•
•
•
•
ABB (inc. Baldor)
Siemens
WEG
Regal Beloit
TECO E&M/TECO-Westinghouse
Leroy Somer
Toshiba
Shandong Huali
Hyundai Heavy Industries/Ideal
Hyosung Corporation
NIDEC (US Motors)
© 2016 IHS
Next-tier Competitors
• Toshiba
• Shandong Huali
• Hyundai Heavy
Industries/Ideal
• Hyosung Corporation
• NIDEC (US Emerson)
• LEZ Ruselprom
• Gamak
•
•
•
•
•
•
•
•
•
•
•
GE Industrial
Tech Full Simo
Cantoni Motor
Fuji Electric
Hengshui (OX)
Crompton Greaves
Tatung Corporation
ATB Group (Wolong)
VEM Group
Luan JiangHuai
Anhui Wannan
Low-voltage motors efficiency class allocaation
EFFICIENCY CLASS TRANSITIONS (UNITS)
Global Low Voltage Motors - Efficiency Class Transition: 2014 to 2019
IE4
1%
DC
1%
Others
7%
IE4
2%
DC
<1%
Others
7%
IE1
21%
IE3
14%
IE1
44%
IE3
29%
IE2
34%
IE2
41%
2014 Market Size (Units)
45.8 Million
2019 Market Size (Units)
51.6 Million
Average Annual Unit Growth ≈ 2.5%
IHS has found that efficiency transitions often take 3-5 years until full compliance is underway.
As governments work together and learn from other regions, it is expected that this timeframe will
be shortened over time.
© 2016 IHS
19
Current allocation of motor efficiency by region
© 2016 IHS
Major motor applications (low-voltage motors)
The World Market for Low Voltage Motors By Application - Market Breakdown and Growth
5,000
8.0%
4,500
6.0%
4,000
2.0%
3,000
2,500
0.0%
2,000
-2.0%
Growth (%)
Revenues ($M)
4.0%
3,500
1,500
-4.0%
1,000
-6.0%
500
-8.0%
0
Source: IHS
2014 Revenues
Growth 2015
Growth 2016
© 2016 IHS
Pumps, fans and compressors account for more than 75% of
worldwide low-voltage motor shipments annually.
© 2016 IHS
21
Outlook for motors and motor-driven equipment
SIGNS OF PROGRESS
CAUSES FOR CONCERN
• Rebound in the construction market
• Struggles with profitability
• Rapid urbanization
• Downward pricing pressure
• Increased demand for comfort
technology
• Slowdown in the project business
• Overcapacity concerns loom,
• Municipalities beginning to build
budgets for infrastructure
development
• Bodes well for water/wastewater
investments
• Focus on systems efficiency
© 2016 IHS
especially in China
• Rentals vs new equipment
• Low-cost providers still prevalent
• Downward forecast in machinery
production, GDP
22
Supplier response to economic headwinds
• Increased focus on aftermarket revenues
• New designs; surpass minimum efficiency requirements
• Solutions providers
• Customers don’t want “just a motor”
• Are all IE3 motors the same?
• New manufacturing techniques
• 3-D printing could be the future
• “Industry 4.0”
© 2016 IHS
23
Efficiency: more than just a number
• Full lifetime cost, accessibility and environmental concerns
• Product advancements; smart manufacturing; 3-D printing
• More than just input/output
• 4/10 manufacturers have no visibility into equipment status
• 30% spend up to 4 hours/day searching for equipment
• 50% of suppliers only realize a problem when it’s too late
© 2016 IHS
24
Conclusion
Key Takeaway:
• Worldwide commitment for systems efficiency is best hope for growth in
the motor market amid such difficult economic times
Notable actions:
• With a shift towards efficiency and smart manufacturing, all industrial
players need to be thinking about how to simplify things for their
customers by providing a full holistic solution
• This means that motor suppliers are looking to offer more than just a
motor, but services and extra components, as well, in order to fit in with
the rapidly evolving “Industry 4.0”
© 2016 IHS
25
Questions?
Contact Information:
Preston Reine, Senior Analyst
IHS Manufacturing Technology
Email: preston.reine@ihs.com
Phone: +1 (512) 582 2059
© 2016 IHS