Motor Manufacturers Grab Market Share with Acquisitions
25 January 1999
Frost & Sullivan - Fractional Horsepower Motor Manufacturers Grab Market Share Through Competitor Acquisition
MOUNTAIN VIEW, Calif., Jan. 25 -- Consolidation poses a
threat to many manufacturers in the fractional horsepower motors industry. As
growth rates slow, competitor acquisition has become the primary means of
increasing market share. To survive, players must plan a solid corporate and
product strategy.
According to new strategic research conducted by Frost & Sullivan
(http://www.frost.com), U.S. Fractional Horsepower Motor Markets, total revenues
reached $5.1 billion in 1997, and the market is expected to continue its
growth throughout the forecast period 1998 to 2004. As end-user capital
spending increases demand for new products, opportunities are expected in all
end-user markets, including appliances, automotive, business equipment,
conveyor belts, food processing equipment, home electronics, medical
equipment, packaging machinery, refrigeration and machine tools.
The fractional horsepower motor market is structured into three
competitive tiers, which together include over 140 market participants. In the
first tier, which consists of about 10 leading manufacturers, companies have
broad product lines and they supply two or more product types with a variety
of options. National suppliers that participate in one or two end-user market
segments make up the second tier, and the third tier is comprised of
vertically integrated manufacturers and niche motor suppliers who are usually
captive suppliers to specific OEMs.
Although the main threat for this market is the economic slowdown, another
cause for concern involves the growth of BLDC motors, says Frost & Sullivan
Analyst George McKinney. As the prices of electronics drop, the performance
advantages of using electronic over mechanical operation increases
substantially. This electronics integration trend negatively affects the older
motor technologies, such as AC synchronous and induction, McKinney says. It
also impacts several growth-oriented end-user markets including HVAC, home
electronics and medical equipment.
In the last few years no new players have entered the market, but there
have been mergers and acquisitions. In addition to consolidation, competition
is being intensified by foreign price competition, low mortgage and interest
rates, dramatic growth in the brushless motors market, and the looming 1999
recession.
Fractional horsepower manufacturers are attempting to compete by employing
several strategies, such as product distribution, brand name awareness
campaign, metal-working capability development, regulatory environment
monitoring, and competitor benchmarking.
This new study by Frost & Sullivan, U.S. Fractional Horsepower Motor
Markets, is divided into three main segments: alternating current (AC)
motors, direct current (DC) motors and universal motors. The AC and DC motor
segments are further broken down into subsegments. Covered in the study are
revenue forecasts, product type forecasts, market shares, industry structure,
market and technology trends, competitive issues and strategies.
The companies participating in this market include: A.O. Smith Electrical
Products, Advanced DC Motors Inc., American Electronics Incorporated (AEI),
Aeroflex Laboratories Inc./Motion Control Systems, American Precision
Industries Inc., Ametek, Anko Products Inc, Arco Electric Products, Ashland
Electric Products, Astromec Inc, Autotrol Corp., Baldor Electric Co., BEI
Motion Systems Co., Belyea Inc., Berger Lahr Motion Technology Inc., Bison
Electric Corp., Black & Decker, Bodine Electric Co., Bosch Automation
Products, Bowman Electrical Products Corp., Braun Instrument Co., Buehler
Motor Inc., Carter Motor Co., CEI Enterprises, Cleveland Motion Controls,
Coleman Motor Products, Cramer Co., Crouzet Corp, Dayton, DCM Corp., Denso
International America, Dooling Bros. Inc., Dumore Co., Dynetic Systems Corp.,
Eastern Air Devices Inc., ECM Motor Co., Electric Indicator Co. Inc., Electric
Motor Developments, Elektrim North America Corp., Emerson Electric Co., Eureka
Co., Fasco Industries Inc., Ford Motor Company, France, Franklin Electric
Company Inc., General Controls Electronics Inc., General Electric Company,
General Signal Corp./Electric Division, Globe Motors, Groschopp, Hansen
Corporation, Hermetic Compressors, Hoover Motor Co. Inc., HSI, Hussman
Refrigeration, IMC Magnetics Corp., Indiana Power Transmissions, Infranor
Inc., ITT Automotive, Jones Instrument Corp., K&G Electric Motor and Pump
Corp., Kaiser Motor Company, Kollmorgen Inland Motor, Lamb Electric, Leeson
Electric International Inc., Leland Faraday, Lexel Corporation, Lincoln
Electric Motors, Litton Poly-Scientific, Mabuchi Motor America, MagneTek
Motors and Generators, Makita Corporation of America, Mallory Controls, Mamco
Corp, Manger Engineering Inc., Marathon Electric Manufacturing Corp.,
Matsushita Compressor Corporation of America, Maxon Precision Motors, McLean
Engineering Division, McMillan Electric Co., Merkle-Korff Industries Inc., MFM
Technology Inc., Micro Mo Electronics Inc., Microgroup Inc., Milwaukee Tool
+ Machine Co., Minnesota Electric Technology, Molon Motor and Coil Corp., Moog
Inc., Morrill Motors Inc., Motor Appliance Corp. (MAC), Motor Products Owosso
Corp., Motor Specialty Inc., Motor Technology Inc., MPC Products Corporation,
Northland, Ohio Electric Motors, Olsen Machine and Tool Co. Inc., Oriental
Motor U.S.A. Corp., Pacific Scientific Co., Pittman Motors, Poulan Weed Eater,
Reliance Electric Co., Reuland Electric, Robbins & Meyers, Robert Bosch, Ryobi
Motor Products Corp., Sears Roebuck and Co., Shinano Kenshi Corp., Siemens
Automotive Corp, Sintech, Skil Corp., Stature Electric Inc., Sunbeam-Oster Co.
Inc., Taylor Refrigeration Services, Triem Inc., United Technologies
Automotive, Uppco Inc., Von Weisse Gear Company, Distributors: Applied
Industrial Technologies, Motion Industries, Associations: International
Organization for National Association of Manufacturers (NAM), Power
Transmission Distributors.
Frost & Sullivan is an international marketing consulting company that
monitors the energy industry for market trends, market measurements and
strategies. This ongoing research is utilized to update a series of research
publications such as #5576-17 U.S. Integral Horsepower Motor Markets,
#5323-17 U.S. Fractional Horsepower Motor Markets and #5317-17 U.S. Integral
Electrical Motor Markets, and to support industry participants with customized
consulting needs.
Report: 5329-17 Publication Date: Dec. 1999 Price: $2950
Visit the Frost & Sullivan Web site: http://www.frost.com