China’s motion control market falls nearly 20 percent in 2012
China’s market for motion control devices plunged by nearly 20 percent in 2012, as the country’s economic slowdown impacted multiple markets that use the devices, including appliances, automotive and housing.
Revenue from sales of motion controls in 2012 fell to $2.2 billion, down 19 percent from $2.7 billion in 2011, according to a report entitled “The Chinese Market for Motion Controls – 2013 Edition” from IMS Research – now part of IHS Inc.
The decline interrupted the robust growth of the market. However, revenue will return to growth this year and by 2016 will reach $3.1 billion, up 44 percent from 2012, as presented in the attached figure.
“The phase-out of stimulus policies had a major negative impact on purchases of home appliances and motor vehicles in 2012,” observed Wilmer Zhou, senior analyst for IHS. “Combined with a slowdown in the housing segment, these events spurred a major decline in the sales of motion controls, which are used in a broad range of industries. But as these markets return to growth from 2013 through 2016, China’s market for motion controls will regain its former vigor and enjoy rapid expansion.”
Motion control involves the management of the position or velocity of machines using some type of device, such as servos and electric motors.
A multinational market
Japanese companies continued to lead China’s market for motion controls in 2012, with a slightly lower 45 percent share. The share held by European and American suppliers remained stable, accounting for 30 percent of the market. Meanwhile, Taiwanese and Korean suppliers increased their share to approximately 10 percent.
In comparison, local Chinese companies were negatively impacted in 2012 even though they achieved amazing growth in 2010 and had a good year in 2011. Chinese manufacturers accounted for just 15 percent of the market in 2012, compared to 19 percent in 2011.
The Chinese, however, have positive prospects in store. “The competitive landscape in the motion control market of China in changing, with domestic suppliers expected to gain share at the expense of the Japanese firms in the coming years,” Zhou said.
Made in Japan
Japanese companies have been in the Chinese market for a long time and wield great influence, and Chinese customers are also very familiar with Japanese motion control products. Panasonic, Mitsubishi, Yaskawa and Sanyo, for instance, have a very large customer base, especially among small- and medium-sized machinery manufacturers. But as Taiwanese and local Chinese companies scramble to wrest markets away, Japanese manufacturers will see their share decline, even though they will still lead the market.
Not quiet on the Western front
For their part, European and American motion control companies have dominated the high-end, high-priced market for a considerable period. As a result, both Japanese and local Chinese manufacturers will be unable to shake the position of Western companies even over the long term, IHS believes.
Moreover, European and American companies have defined their products and markets well. For instance, Siemens is positioned to serve the high-end CNC machine-tool industry and large-scale projects; LUST and B&R perform well in dedicated applications; Danaher (Kollmorgen) and Parker focus on electronics, packaging and other customized markets; Lenze specializes on high-end textile machinery and material handling machinery; and Bosch Rexroth is very strong in the printing and packaging industries.
And even though European and American firms are encountering some difficulties entering the low-end market because they have different customer bases, sales networks and business models, that should not become a concern, Zhou noted. “With the industry upgrading and developing high-end equipment, the demand for high-end motion-control products will increase. Such a development will allow the market share of European and American companies to remain stable,” he said.
Chinese motor suppliers go into overdrive
From 2008 to 2012, many local Chinese suppliers of motor drives, stepper motors and induction motors entered the field of motion controls. Relying on low cost and better customer relationships, companies like Euston, Inovance, Modrol, Mege, Dorna, Maxsine and Huada were able to break through the motion control market.
Still, the gains won’t be come easy. While local suppliers will capture more and more market share from Japanese manufacturers in the long term, the process will be slow, beset with turmoil and many twists and turns. In light of a changing market, for instance, the GSK and KDN business rose rapidly in 2010 but decreased sharply in 2012.
– Edited by CFE Media, Control Engineering, Plant Engineering. See additional automation and control research.