Company shares views on industry's future
Critical Issues
For most companies, the U.S. economy, the strength of the U.S. dollar and the housing market will continue to set the pace for the coming months. These factors will influence companies depending on their market segments. The housing market and credit issues continue to be a source of slow down in the residential market. Retro-fit and replacement business continue, but anything tied to new construction will suffer. We do not see any improvements in this area.
There is a prevailing wind with the election year approaching; we will see much more of a flat residential market in 2008. Residential will continue to be driven by the replacement market and the continuing price pressures. The commercial market continues to be strong with available capital for construction. With the strength of the dollar as an issue, there is a concern whether this available capital will continue and if we will see a carry over from the residential market.
We believe the commercial market will continue to be viable in the coming 18-24 months, but competition will get tougher as more people focus on this market. The most interesting sector is the industrial market. In the past years, it has been a very flat, low growth area, but new technologies and a focus on bio markets have created real opportunities. There are sectors that will do well, and those that can participate in biofuels, ethanol, pharmaceutical, food and beverage, etc. should do well.
Current Trends
One clear, continuously-developing technology is variable speed and constant pressure technologies. This expands beyond drives and into controls. This technology is becoming accessible across all sectors. Investments and new products in pumps and pumping systems drive constant pressure and systems designs.
The other longer term trend is the green and sustainability awakening of the United States. We are at the early stages when this is becoming a standard in mechanical equipment, but end users, plant maintenance, facility people and engineers will make "green" part of our design thinking over time.
Additional Insights
We continue to expand globally and become much more of a player in the United States. We will keep our focus on target markets and hope to bring a greater awareness of our brand in the U.S. pump environment. We focus on bringing new, innovative ideas and products to support customers. We also continue to focus on being a good corporate citizen.
We will continue to design pumps that are efficient in using our world's resources. As a manufacturer, we are constantly aware of the environment and the impact we have in our day to day operations.
Lastly, as a local citizen, we hope that people will look upon us a positive influence in our local communities.
Pumps & Systems, January 2008