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| AM31018 |
| AMA ELECTRICAL ACCESSORIES MARKET OCTOBER 1998 |
| Overview |
This report covers:
Companies covered include:
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The overall electrical accessories market is analysed in three key product sectors for the purpose of this report:-
The performance of these sectors is closely linked to new building and RMI on both housing and non-housing projects.
The overall market developed rapidly in the mid-late 1980's motivated by the positive economic climate, with high levels of domestic, commercial and industrial construction, as well as a boom in consumer spending.
However, the market was adversely affected by the economic downturn during the early 1990's, due to reduced construction levels in all sectors, with consumer oriented markets such as wiring accessories and consumer units particularly badly affected.
Levels of non-domestic construction have exhibited steady growth since 1993, providing a boost to sectors with an industrial or commercial orientation, such as circuit protection and switchgear. However, commercial construction remains well below the levels seen in 1990 and this continues to limit market growth.
The domestic sector has been slow to recover, with confidence in the housing market only returning over the last couple of years. Whilst 1996 and 1997 saw an upturn in levels of homemoving and new build, this has only more recently stimulated an increase in sales of electrical accessories into the domestic sector, with the majority of these products installed towards the end of a construction project.
Another key factor affecting market size and structure has been the dramatic increase in the level of less expensive imported products, primarily sourced from the Far East. This has significantly affected a number of sectors where there is little feature differentiation, including wiring accessories, cable accessories and cables, resulting in falling unit prices, with a negative impact on UK manufacturers sales and profit margins.
The outlook for the electrical accessories market is uncertain due to the anticipated slowing of the economy and the adverse impact of the strength of Sterling on the UK manufacturing industry. This is likely to produce difficult market conditions at least in the short to medium term, although the commercial sector may be supported to some extent by a limited number of prestigious Millennium developments.
The cables and accessories sector dominates the market accounting for some 51 percent of sales, although has lost share over the last few years driven by the fiercely price competitive nature of the cables market. Circuit protection and switchgear, in contrast have grown share, with wiring accessories accounting for the balance.
The wiring accessories sector has established modest growth during the mid to late 1990's, benefiting, in addition to macro-economic influences, from a number of key factors. These include growing household ownership of a wide range of electrical appliances, increased automation in offices and legislation requiring that electrical appliances are fitted with plugs at the point of manufacture. However, the market has suffered from a growing level of cheap South East Asian imports, with these products now established to account for around a quarter of all sales. Sales of wiring accessories are concentrated in domestic and commercial environments, with only a limited share (8 percent) of industrial plugs and sockets sold into factories, warehouses, on-site applications etc.
The major suppliers of wiring accessories for the domestic environment include MK Electric, Ashley Rock, Tenby, Volex, Crabtree and Delta, while the industrial wiring accessory suppliers include Lewden, Legrand, MK, Wylex and Martin & Lunel.
Sales of circuit protection and switchgear products are focused towards the industrial/commercial sector, which accounts for 84 percent of the market and the sector has therefore benefited from the upturn in construction in these sectors.
In addition, the sector has benefited from growth in added-value products, led by the shift away from fuse-based technology towards circuit breaker products, as well as use of modular products and 'intelligent' circuit breakers incorporating electronic components. In addition, the more complex control and distribution requirements of modern buildings has added value to the switchboard, distribution board and consumer unit sectors. Growing awareness and legislation relating to safety issues has also contributed to growth in this sector, with increased use of residual current devices in particular, both in domestic and commercial application areas.
The major suppliers vary according to the different product sectors with Hager, Wylex, Delta/Mem, Crabtree and Schneider (Merlin Gerin/Telemechanique) strong in consumer units, as well as miniature circuit breakers, with B&R Electrical, Wylex, Merlin Gerin, Bill, MEM and MK strong in residual current devices. Moulded case circuit breakers feature Schneider, Crabtree, MEM/Bill/Delta, Wylex, MK, Hager, Mitsubishi, Crabtree, Square D, GE, Dorman Smith etc. Many of these also supply custom built boards although electrical contractors increasingly construct these themselves, benefiting from the development of modular assemblies and Computer Aided Design (CAD).
Cables, accessories, conduit and trunking accounts for the largest share of the electrical accessories market. This is dominated by general wiring cables, though accessories, conduit and trunking are major markets in themselves.
Cable sales are heavily dependent upon new build construction levels, and while there has been an upturn in non-domestic construction, since 1993, levels of commercial construction remain below those seen in 1990. This has resulted in a considerable overcapacity in production, which combined with a growing level of low cost imported cables has produced a highly cost competitive market place.
Whilst the cables market continues to be dominated by UK manufacturers, principally BICC, Pirelli and AEI, these difficulties forced one major manufacturer, Delta, to exit the market altogether in 1998, selling its production facilities to BICC.
Sales of cable accessories, particularly cable management and identification products, have shown good growth benefiting in particular from the increasing complexity of wiring systems in commercial and industrial application areas. Lack of feature differentiation and low barriers to market entry have resulted in a large number of cable accessory suppliers, with a growing level of imported product from China and the Far East. However, major suppliers include Critchley, Appleby, Panduit, BICC, EDL, Kompress, Tower, Ampliversal, 3M and Tenby. The key conduit and trunking suppliers are Marshall Tufflex, EGA, Kopex, Critchley, Barton and Thomas & Betts, in addition to the flexible conduit suppliers Electroflex, Adaptaflex etc.
This comprehensive report represents a detailed assessment of the market, reviewing major trends, key factors influencing developments and future prospects for the sector. Analysis is both quantitative and qualitative, based on our substantial experience of the building and home improvement markets.
Text © 1998 AMA Research
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