The European Market for Hydraulic Equipment (Report 3519): lower prices and improved product quality and design to attract increased end-user interest in hydraulics

Citation

(1998), "The European Market for Hydraulic Equipment (Report 3519): lower prices and improved product quality and design to attract increased end-user interest in hydraulics", Industrial Robot, Vol. 25 No. 6. https://doi.org/10.1108/ir.1998.04925fab.008

The European Market for Hydraulic Equipment (Report 3519): lower prices and improved product quality and design to attract increased end-user interest in hydraulics

The European Market for Hydraulic Equipment (Report 3519): lower prices and improved product quality and design to attract increased end-user interest in hydraulics

Keywords Hydraulics, Market survey

Continued product innovation, competitive pricing and the need to replace old equipment can all be expected to promote future growth and continued investment across the European hydraulic equipment market. The mobile market is expected to see the strongest rise in interest, maintaining its position as the largest and most important user of hydraulic equipment. In 2004, revenues in the European hydraulics market are forecast to increase by 4.6 per cent to reach US$7.46 billion (see Figure 2).

According to a new study by Frost & Sullivan, the international marketing consulting company, the continued advancement of the hydraulic equipment market can be seen across all product sectors and regions. The strength of various industries in each region is crucial with regards to the scale and rate of overall growth.

In its review of national markets, Frost & Sullivan's study confirms Germany's position as the largest regional market for hydraulic equipment. The large industrial and mobile end-user base continues to provide a significant source of demand and investment levels remain high. Nevertheless, the German market is being affected by user demand for more cost-competitive technology, and Germany is expected to experience below market average growth.

The pumps and motors market was the leading product sector in 1997. This dominant position is anticipated to be retained. The valves sector, the second largest, is forecast to see a slight increase in revenue share over the forecast period as design enhancements and developments promote further investment.

Another notable market is the power packs sector. Although this is the smallest market sector, interest is rising more strongly. Overall revenue growth for power packs is anticipated to be curtailed by price pressures, but an increasing total of users are focusing on integrated solutions.

Mik Sabiers, industry manager at Frost & Sullivan, remarks that the hydraulics market as a whole is expected to benefit from a period of prolonged and sustained growth. The interrelation between products is projected to result in only a small variation between overall growth levels for each product type.

Figure 2 Total European hydraulic equipment market (per cent of revenues by product type ­ forecast for the year 2004)

Technology trends have primarily remained unchanged this decade due to development times and the mature stage of hydraulic equipment in terms of market lifetime. With regard to the technology, continued reductions in noise levels have attracted more interest in pumps and motors. Mr Sabiers also comments: "Much greater use of electronic controls, particularly in relation to valves, has encouraged greater end-user investment. Companies with a strong focus in this field have in many instances experienced higher growth than others in the market".

The most important competitive factor is price. Low pricing has enabled participants to sustain demand and is one of the means by which new entrants attack the market. Some major competitors are using price as a strategy with which to penetrate a greater portion of their market. In some applications, for example in the aerospace industry, price is not of prime importance and quality takes priority.

Frost & Sullivan conclude: "The European market for hydraulic equipment is forecast to see a continued and sustained increase in revenues over the course of the forecast period. Competitive pressures are likely to heighten, but developments in the technology combined with lower prices and continuing investment from key user sectors are all projected to drive revenues higher in future years".

Report 3519 was published in July 1998 and is priced US$3,950.

For further press information, please contact Frost & Sullivan's Public Relations Department. Tel: +44 171 915 7824; Fax: +44 171 730 3343; E-mail: kristina.menzefricke@fs-europe.com. Or see the company's Website (www.frost.com) for details on Frost & Sullivan's Media Service.