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Asia Pacific Medium- and High- voltage Switchgear Markets Update
Frost & Sullivan, April 2011, Pages: 120
Industrial Development Revs up Growth in the Asia Pacific Medium- and High-voltage Switchgear Markets
During 2006-2009, the Asia Pacific medium- and high-voltage switchgear market was driven by development in power transmission and distribution infrastructure, increased power consumption, boom in industrial capital expenditure and demand for replacement of aging equipment. The market witnessed a drop in revenue in 2009 due to declining demand across all sectors, especially in the East Asian region. The repercussions of the global economic recession were felt in the economy in 2009 but the market is expected to recover rapidly in 2011. Demand for switchgears is expected to be higher in the Southeast Asian region, whereas the demand for retrofit and spare parts is likely to be higher in East Asian and Australasian region. “Vietnam and Indonesia are poised to drive the growth of the medium- and high- voltage switchgear market in Southeast Asia during the short and medium term,” notes the analyst of this research service. “Indonesia, with the target to achieve electrification ratio up to 90 percent in the next ten years will boost the switchgear market in the long term.”
The Asia Pacific medium- and high-voltage switchgear market is currently in the growth stage in the industry life cycle. The industrial development and public infrastructure investment are likely to be the major drivers in the medium-voltage switchgear market. The major drivers of growth in the high-voltage switchgear market are likely to be power capacity addition and transmission and distribution (T&D) infrastructure development.
Smart Pricing and Efficient Design Will Determine Business Outcomes in this Market
The spike in prices of raw materials such as steel, copper, and aluminium has led to difficulties in managing production costs. Price sensitivity in the Asia Pacific region has forced participants to keep prices competitive in order to sustain business. This has tightened the profit margin of switchgear manufacturers. Pricing pressures have forced companies in the East Asian and Australasia regions to shift their production plants to low-cost countries in Southeast Asia and China. Both brand- and quality-conscious consumers and those who prefer low-quality and -priced products exist in the market. The challenge for participants is to cater to the needs of both customer segments without compromising on quality. Moreover, low-priced Chinese products have entered the market. This poses impediments for established participants, especially in the low-voltage switchgear segment. Besides price, the key competitive factors in the Asia Pacific medium- and high-voltage switchgear market are after-sales service, quality and location. Multinational majors have different set of products to address price-conscious markets and premium markets that require superior functionality, whereas local participants mainly target the price-conscious markets.
Fostering and establishing partnerships with local manufacturers, government agencies, value-added resellers and distributors is one of the strategies for business expansion and divergence. The high-voltage switchgear market in the Asia Pacific region is highly driven by the specifications and experience of manufacturers in serving the utilities in the region. The barriers to entry are very high. Trends point to a preference for participants that are locally present or those that have established strategic tie ups with local manufacturers. These participants are likely to have a better understanding of changing market dynamics and can help in identifying opportunities at the appropriate time.
Technologies
The following technologies are covered in this research:
- Air insulated switchgear
- Gas insulated switchgear
- Ring main units
- SF6 circuit breaker
- Vacuum circuit breaker
- Switch disconnector
This Frost & Sullivan research service titled Asia Pacific Medium- and High-voltage Switchgear Markets Update provides a comprehensive study of the total switchgear products and switchgear assemblies in the region. The study includes key market dynamics, trends, competitive analysis, end-user analysis, and revenue forecasts that impact the market. In this research, Frost & Sullivan’s expert analysts thoroughly examine the following technologies: air-insulated switchgear, gas-insulated switchgear, ring main units, SF6 circuit breaker, vacuum circuit breaker, and switch disconnector.
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