Motion System Design

Drives market sees continued growth

The past 24 months have seen the strongest consecutive years of growth for the worldwide ac and dc drives market in over a decade, says data from IMS Research, Austin, Tex. The market was strong across all product categories, power ranges, and regions, including China and North America. The most surprising growth was in Europe, the Middle East, and Africa (EMEA). After lagging for the past few years, EMEA growth was surpassed only by China.

EMEA saw double-digit growth in 2005 with revenue growth going from -0.5 to more than 10% through the first quarter of 2006. North American sales rose sharply in the fourth quarter of 2005, from 10 to nearly 20% revenue growth. This figure dropped again through the first quarter of 2006, showing the North American drives market is experiencing its slowest growth rate in five quarters.

The primary key to EMEA's growth was strong exports to China, North America, and Eastern Europe. According to analyst Steve Odom, “The manufacturing boom in China, big spending increases around the globe to raise base commodities, and higher energy prices prompting demand for energy efficiency, helped advance all regional drives markets.”

High-performance, high power low-voltage drives experienced the strongest growth in 2005. “However, growth was strong across the board and was more impressive in this premium category because of the drives' larger size and price points. Typically, the highest rates of growth are in the lower power ranges and less expensive drives,” Odom continued.

Longer-term, this lower end of the market should offer the most growth. Applications where high levels of functionality and control are required are likely to already have some form of variable-speed control attached,” says Odom. In a high energy cost environment, the economic argument for placing drives in lower-end fan and pump applications strengthens, particularly given that the price of these drives is falling 4 to 5% each year. New applications are opening up for this lower end of the market.”
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