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Whether manufacturers are making acquisitions, moving into new markets, launching new products, appointing new executives or reorganizing their operations, they are often making the moves because of opportunities or challenges in five areas:
- The lighting transformation to LEDs
- The energy revolution
- Opportunities with more-modern ports, intermodal facilities and rail lines
- The evolving power grid
- Our more connected world
Below is a quick capsule summary of what’s happening in each of these areas. You can find out more about them in this month’s cover story, “10 Electrical Manufacturers to Watch” (page 14), and in its expanded digital version on www.ewweb.com.
The lighting transformation to LEDs. It doesn’t seem all that long ago that you only saw LEDs in traffic signals, exit signs, flashlights and as the blinking green or blue eyes on televisions, computers and other electronic devices. Today, LEDs account for nearly 30% of all lighting products sold by two of three largest lighting manufacturers in the world, Philips and OSRAM, and according to Philips’ 2013 10K, LEDs will account for 45% of the total lighting market by 2015. The highest quality LEDs offer excellent color rendition and a decent return-on-investment (ROI), and all of them offer lamp life that’s many times that of traditional lamps. Shoddy craftsmanship is a problem with some imported LEDs, but LEDs made by reputable manufacturers offer a realistic lighting option for an increasing number of mainstream applications.
The energy revolution. As oil & gas companies unlock new sources of domestic oil and natural gas in North Dakota, Texas and the Marcellus Shale deposits in Ohio, Pennsylvania and New York, it’s having a direct business impact on our market. On the distributor front, many of the new or expanded branch locations that have opened up recently were launched to service this new demand. On the manufacturer front, companies with strong offerings in explosionproof equipment and other products needed at the drill sites and processing facilities appear to be nicely positioned for growth.
Market opportunities with the new logistics of moving products through more-modern ports, intermodal facilities and rail lines. A new generation of supertankers will soon be making their way to U.S. ports if the Panama Canal expansion is completed as expected in 2015. Key shipping centers along both coasts are dredging harbors, expanding docks and building new container-handling equipment to handle these behemoths.
In addition to the ongoing ramp-up in the construction of new port facilities on the East Coast, West Coast and Gulf of Mexico to handle the new super-ships, over the next few years there’s expected to be an explosion in the construction of LNG (liquefied natural gas) facilities on the coasts for international export of natural gas processed in the United States.
Another element in this whole new logistics scenario is the construction of new intermodal container facilities near these ports and inland. At these intermodal facilities containers are brought in by rail and transferred to trucks for local or regional shipment.
The evolving power grid. The existing power grid desperately needs to be modernized to keep pace with the coming demand increases from electric vehicles, data centers and other digital devices with enormous appetites for power, as well as the quirky power profiles of electricity coming online from wind farms and PV power plants. The grid also needs to stay safe from terrorists and dependably produce power without the threat of blackouts. Additionally, utility execs are figuring out if the smart grid is for real and how to best harness digital communications and metering.
Our more-connected world. Because you can now communicate wirelessly with any devices that have Internet Protocol (IP) addresses, there’s been an explosion in new-generation control devices including residential smart meters, lighting fixtures out on the interstate and brainy sensors on the factory floor.
These trends represent both challenges and opportunities for distributors, manufacturers, reps, contractors and other end users.