China‘s PLC and PAC Market to grow

  • March 20, 2011
  • ARC Advisory Group
  • News

March 20, 2011: China continues to make investments in automation as a result of strong domestic demand driven by government stimulus, the recovering global economy, and buoyant foreign direct investment (FDI). ARC expects conditions are ripe to propel the growth of China’s manufacturing industry resulting in the strong growth of the Programmable Logic Controller (PLC) and PLC-based Programmable Automation Controller (PAC) market through 2014. ARC’s new study, “PLC and PLC-based PAC Outlook for China”, provides an in-depth analysis of the PLC and PLC-based PAC business and associated segments in China. In addition to market analysis and forecasts, the study also covers trends and factors influencing the market and analyzes strategic issues for suppliers to successfully navigate the current and future market landscape. China Remains One of the Largest PLC Markets with Sustainable Growth According to Jason Dong, GM of ARC Advisory Group China, “China’s economy was the first in the world to recover and will continue its robust growth at sustainable levels for years to come.” He continues, “Given the favorable business environment for the automation market, it is clear that the prospects for PLC and PLC-based PACs are beginning to brighten. We expect the shipments to recover much of its decline in 2008 by the end of 2010.” Because PLCs are the automation system of choice in many industrial verticals, China’s economic expansion is spurring above average PLC growth in the process, hybrid, and discrete manufacturing segments. According to the principal author of ARC’s study, Lorry Zhong, “The PLC market will grow at a rate slightly above the GDP growth year-over-year during the forecast period of the study. This growth is driven by the huge government stimulus, domestic demand, increasing global needs, and buoyant FDI. Suppliers should closely watch the results of China’s stimulus programs, however, and respond appropriately if they overheat the economy.” Expanding Opportunities for PLC and PLC-based PAC Suppliers The country’s favorable business environment continues to attract new facility investments from around the globe to take advantage of low cost production. Infrastructure and fiscal incentives provided by the local authorities make it feasible to economically establish large scale plants catering to not just domestic, but also global demand. The country’s sustainable growth prospects and expansion across nearly all manufacturing verticals makes China an attractive market for PLC suppliers. While the existing PLC and PLC-based PAC suppliers are upbeat about the market, the country’s sustainable growth prospects and the potential that it offers is attracting indigenous and other leading suppliers into the market. With the growth of new entrants, support offices and production facilities will be built, changing the market dynamics and increasing competitive pressure. Suppliers will need to deploy new strategies to combat this competitive threat. About ARC: Founded in 1986, ARC Advisory Group is the leading research and advisory firm for industry. Our coverage of technology from business systems to product and asset lifecycle management, supply chain management, operations management, and automation systems makes us the go-to firm for business and IT executives around the world. For the complex business issues facing organizations today, our analysts have the industry knowledge and first-hand experience to help our clients find the best answers.

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