ARC Advisory Group Study: Low Power AC Drive Market Experiences Robust Growth | Automation.com

ARC Advisory Group Study: Low Power AC Drive Market Experiences Robust Growth

September 142005
Dedham, Massachusetts; The low power AC drive market experienced robust growth in 2004, as the world economy enjoyed one of its strongest years of growth with heightened demand from various emerging markets. The low power AC drive market crossed the $5 billion mark in 2004 and is expected to grow at a Compounded Annual Growth Rate (CAGR) of 8.6 percent over the next five years, according to a new ARC Advisory Group study, “Low Power AC Drive Worldwide Outlook”.

Investments were made in many industrial segments to cater to growing consumer demand and infrastructure development needs. The driving factors for capital investments are expected to remain strong during the next five year period. “With oil prices escalating and drive prices falling, the payback period for AC drives investment is becoming shorter, pushing their use on a broad basis,” according to Senior Analyst Himanshu Shah, the study’s principal author.

Ever Increasing Applications
The availability of cost-effective, miniature, and reliable electronic components has resulted in low cost, compact size AC drives reaching the market. Falling prices, coupled with availability of AC drives in a compact form factor, propelled its use in wide ranging applications in industrial and consumer segments. Low power AC drives with user friendly features such as self diagnostics and enhanced communications, help users realize a greater return on assets.

Users’ Eye on Business Issues
Users today look beyond drives and seek ‘drives-motors-driven equipment’ solutions laying emphasis on lifecycle cost, productivity, and return on assets (ROA). Responding to user demands, suppliers offer total solutions that include higher levels of technical support and improved interface packages.

Emerging Regions Drive Growth
The positive economic developments in emerging regions, such as Asia, Latin America, Eastern Europe, and the Middle East, significantly contribute to low power AC drive market growth. EMEA continues to be the largest market for low power AC drives. With Asia continuing to attract massive investments in basic industries, this region is expected to expand quickly.

Factors such as energy savings, compact design and lower cost, reliability, solutions based approach, and new technologies spur the growth of the low power AC drives market. The report also addresses various challenges suppliers face and how they respond.

Founded in 1986, ARC Advisory Group has grown to become the Thought Leader in Manufacturing and Supply Chain solutions. No matter how complex your business issues, our analysts have the expert industry knowledge and first-hand experience to help you find the best answer. We focus on simple yet critical goals: improving your return on assets, operational performance, total cost of ownership, project time-to-benefit, and share holder value. Further information can be obtained from ARC, Three Allied Drive, Dedham, MA 02026, 781-471-1000, Fax 781-471-1100, Web www.ARCweb.com.
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