Analysis of motor market worth and competition
This article analyzes the development of motor industry and its supply and demand through the data reported by National Bureau of Statistics.
In China’s multi-manufacturer motor market, the competitions focus on technology, pricing and production scale, among which the price war adversely affects the market due to the inefficient market mechanism. Nonetheless, the price impact will be weakened as energy efficiency labels for motors are enforced, the market becomes more competitive and the entry barrier has strengthened its effect.
In a competitive market where big motor makers engage in the wave of merger and acquisition, the leading motor producers pay growing attention to market research, especially on market demand tendency. Thus, these companies stand out in a number of motor suppliers and lead the market.
Statistics show that electric motors consume 60 percent of electric power and small-and-medium motor power accounts for 75 percent of the total in China. As the small-and medium motor efficiency increase by 1 percentage point, over 2 billion kilowatt hours of power can be saved annually. In this way, motor market has huge potential for energy conservation.
2015-2017 China Electric Motor Market Size
Analysis of domestic motor market competition
Electric motor, an important device for electrical<>mechanical energy conversion and electric drive, is widely applied in different fields for its variety of specifications. Given that, electric motor industry has a loose structure and subdivided industries. It also can be produced regardless of the geographical barriers and seasonal restrictions.
As a labor-and-technology-intensive industry, the large-and-medium motor market is highly concentrated than small motor market. That is for the reason that the listed companies and state-owned companies expand their market shares with the advantages on fund, production capacity and brand recognition, while other smaller suppliers are left to grab the rest of the market. This is called the “Matthew’s effect” that can enhance industrial centralization through eliminating weaker companies.
In general, most domestic motor suppliers focus on the manufacture of low-end products, and are smaller than foreign companies which can lead he market with advantages on technology and management.
Analysis of domestic motor suppliers’ competitive power
Over the recent years, China has emerged as a major producer of motors. Despite its high-efficient and energy-efficient technologies in producing motors, the market is less competitive. For example, China uses quantities of electric power in producing motors and this low energy efficiency has restricted the sound economic development.
Although China now is a large exporter of electric motors, but it can only produce motors with low energy efficiency. It still needs the import of high-tech motors such as high-speed brushless motors and high-precision stepping motors.
When the wave of lowering energy efficiency swept across the world, producing energy-saving motors with high efficiency has become a common target for the global motor market. As a major player in energy saving, environmental protection, new energy and high-end equipment manufacturing, the motor industry will receive more supports from government policies.
China has a variety of motors with low efficiency. The promotion of high-efficient motor in China still lags behind by the global average, and the products are 3-5 percentage point and 10-20 percentage point lower than developed countries in average efficiency and operating efficiency respectively. Thus, China’s motor market needs to embark on a high-energy-efficient path in the future.