ABB acquisition brings new power to UPS market

IMS report: Purchase of Newave could turn growing UPS market into a four-way race

12/14/2011


According to the analyst firm IMS Research,  ABB’s acquisition of Newave points to more consolidation in a market where the top 10 suppliers control 72% of industry revenues. It is a smart acquisition, given that the $7Bn market is projected to grow by an average of 7% per year over the next five years.

 

A year and a half after it was by outbid by Emerson for the purchase of Chloride, Switzerland-based ABB has returned to the data center-power area, this time looking closer to home. The recent announcement of acquisition of Newave SA, a fellow Swiss company specializing in Uninterruptible Power Supply (UPS) systems, continues the trend of large multinational organizations purchasing UPS manufacturers. IMS Research believes this most recent example could present a challenge to established players in the coming years.

 

Jason dePreaux, a Research Manager who studies the UPS market, maintains that the impact of ABB’s acquisition of Newave will be felt more in the future, as opposed to instantly. “When Schneider bought APC, and when Emerson acquired Chloride, each entity was already deeply involved in the UPS market," he said. "So, each time, it was a case of making a big UPS company even bigger. In contrast, ABB is not currently a major UPS player and Newave’s footprint is mainly in Europe. So, the effect of the acquisition will not be immediate on the market.”

 

Currently, over half the UPS market is held by the top three players - Schneider Electric, Emerson, and Eaton. Over the past five years, each of these companies purchased other UPS vendors to enhance geographic coverage and expand product portfolios.

 

Depending on how aggressively ABB moves to expand Newave’s business, it could challenge the supremacy of the “big three." dePreaux continues, “The reach of ABB is enormous and could accelerate the growth of Newave’s business. Today, Newave is the 7th ranked vendor in Western Europe, but much of the future market growth will be found in developing areas like Asia and Latin America. ABB’s resources could really kick-start Newave’s expansion in these regions.”

 

The trend is for vendors to expand beyond UPS and provide a full range of products and services centered on data center markets. dePreaux concludes, “I think this is a long term play for ABB. UPS is a critical part of data center infrastructure and services. When the deal closes, it won’t radically reshape the market but, over time, ABB could develop its position in to the point where we may need to redub the market leaders as ‘the big four.’”



No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2015 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
Your leaks start here: Take a disciplined approach with your hydraulic system; U.S. presence at Hannover Messe a rousing success
Hannover Messe 2016: Taking hold of the future - Partner Country status spotlights U.S. manufacturing; Honoring manufacturing excellence: The 2015 Product of the Year Winners
Inside IIoT: How technology, strategy can improve your operation; Dry media or web scrubber?; Six steps to design a PM program
Getting to the bottom of subsea repairs: Older pipelines need more attention, and operators need a repair strategy; OTC preview; Offshore production difficult - and crucial
Digital oilfields: Integrated HMI/SCADA systems enable smarter data acquisition; Real-world impact of simulation; Electric actuator technology prospers in production fields
Special report: U.S. natural gas; LNG transport technologies evolve to meet market demand; Understanding new methane regulations; Predictive maintenance for gas pipeline compressors
Warehouse winter comfort: The HTHV solution; Cooling with natural gas; Plastics industry booming
Managing automation upgrades, retrofits; Making technical, business sense; Ensuring network cyber security
Designing generator systems; Using online commissioning tools; Selective coordination best practices

Annual Salary Survey

Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.

There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.

But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.

Read more: 2015 Salary Survey

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
This article collection contains several articles on the vital role that compressed air plays in manufacturing plants.
This article collection contains several articles on the Industrial Internet of Things (IIoT) and how it is transforming manufacturing.
This article collection contains several articles on strategic maintenance and understanding all the parts of your plant.
click me