Climate Control News have provided an analysis of an IBIS World report on the outlook of Australia’s HVACR industry over the next five years.
Climate Control News’ report analyses IBIS World’s market research report: Heating, Cooling and Ventilation Equipment Manufacturing in Australia. Climate Control News’ analysis focuses specifically on how cheap imports and competitive landscape affect industry revenue in manufacturing.
IBIS World’s report covered manufacturers of HVAC equipment (installed space heaters, refrigeration products and air conditioning systems) ranging from 8 to over 5000 Kilowatts. The report stated that the overall profitability of industry manufacturers had increased from 8.9 percent to an estimated 11.3 percent over the last five years. The report also stated that higher industry employment is due to increase over the next five years due to increased domestic demand, this is good news as IBIS World estimated that employment numbers in previous years declined due to a decrease in demand and reduced labour requirements.
Climate Control News provided analysis of IBIS World’s report specifically focusing on how cheap imports and competitive landscape affect industry revenue in manufacturing. According to the IBIS World report and Climate Control News’ analysis, the industry faced high and steady competition from imports over the past five years, which lead to outsourcing production to Asian countries in an effort to improve margins. Competing imports are estimated to total over $841 million over the next year and imports are expected to increase at 2.7 percent annually over the next five years.
In the competitive industry landscape, the IBIS World report states that the industry is expected to be slightly less profitable over the next five years. Prices for specific equipment including steel, motor, compressors and pumps will remain stable with large industrial and commercial ventilation systems in decline due to the demand of reverse cycle air conditioners and environmental concerns will continue to impact the industry through to 2020. The report also stated that Australian’s eastern states account for the majority of industry revenue.
You can read Climate Control News’ full analysis of IBIS World’s report here. If you are interested in purchasing the report, you can do so here.
Image via Wikipedia.