An IHS report expects the global generator set market to surpass 2013 figures when over one million units worth just under $16 billion were shipped worldwide. The sales growth in 2014 is ramping up towards an even stronger year in 2015.
IHS defines a generator set as the packaged combination of a reciprocating engine and an electric generator, most often referred to as an alternator, used for the purpose of producing electricity in commercial and industrial applications.
Generator sets are used for emergency standby, continuous prime power, and peak shaving applications across a wide range of industry sectors that tend to be quite volatile from year to year. While growth in the past two years, 2012 and 2013 has been quite flat, 2014 promises to be a good year with many companies reporting mid-single-digit growth and increasing order volumes while double-digit growth rates are expected in specific regions and product markets.
While the expected general economic stabilisation will provide support to the generator sets market in 2014 and 2015, IHS believes the increased investment in infrastructure projects in regions such as the Middle East and Southeast Asia will be an important factor in spurring growth in the market. Infrastructure investment supports a number of industries relevant to the generator sets market, including commercial buildings, construction, rail, telecommunications, and water and wastewater.
Sales in the Middle East will be further boosted by reconstruction efforts in its war-torn areas and are forecast to grow by 12.4% in 2015. The rail industry in Asia is forecast to experience revenue growth of 15.3% in 2015. Generator set sales across Southeast Asia will experience rapid growth as the region pushes forward several ambitious freight and commuter railway projects.
EMEA was the largest regional market for generator sets in 2013, comprising approximately 37% of global market revenues during the year. Sales are forecast to grow more slowly in the EMEA region than the other regions as the Eurozone is expected to continue to struggle to break out of the economic woes the region has experienced since 2009.
The Asian market is projected to be the fastest-growing region globally in 2014, with generator set revenues expected to grow at a rate of 7.1%. India will account for the fastest growth within the region due to power shortages in the country. Southeast Asian countries such as Thailand will see a high level of investment in new data centre construction. The positive outlook for the generator set market in Asia is encouraging several global manufacturers to expand their presence in the region, through new facilities or distribution partnerships.