The outbreak of coronavirus (COVID-19) has shaken the foundations of the world’s economy.
.jpg "COVID-19 and its effect in the pump industry 1")
Leading to the temporary closure of manufacturing facilities and emergency lockdown.
Your company has probably been affected by the circumstances.
The situation is unclear but to help you and your business deal with it…
Here you can find how this economical factor will impact the industry of pump manufacturers.
Also covering the global opportunities in 2020 for your pump manufacturing enterprise.
This is the current situation
The year 2020 began with a slowdown in the global economy.
The worst-case scenario came with the pandemic, that has damaged (and still damages) several aspects, among which business and investor’s confidence.
The Covid-19 effect combined with a price war between China and Saudi Arabia on the price of oil leaves us with an uncertain future outlook.
The price war between the oil-rich nations reached a peak with Saudi Arabia’s announcement of a $3 per barrel reduction in March 2020.
Moreover, oil prices crashed with West Texas Intermediate (WTI) reaching the lowest ever in the last decade at $20.8 per barrel.
Industry forecast
Once we have studied the situation, we can make some predictions based on it.
What’s the future like for pump manufacturers as you?
The whole of 2020 is likely to remain uncertain affecting the investments until the COVID-19 vaccine is developed and the number of infections decreases.
Regarding the price of oil in the coming months, this will remain unstable during 2020.
Due to:
- Russia and Saudi Arabia’s disagreement with the Organization of the Petroleum Exporting Countries’ (OPEC) production cut.
- Prevalence of COVID-19 and the threat of another period of confinement.
Market consolidation through mergers and acquisitions is expected to be a key factor to increase market share and presence of pump manufacturers.
.jpg "COVID-19 and its effect in the pump industry 2")
Given the maturity of the market and competition, innovative and strategic perspectives of collaboration and consolidation will be necessary to drive the long-term growth of larger market participants in the high-growth markets.
What the studies say
In order to get a clearer picture of the situation we must look at the following reports:
According to Research and Markets, services that include programs that improve pump reliability and minimize the extent of unexpected damages will continue to gain traction in 2020 as economic conditions set in.
Water and wastewater, chemicals, and O&G are expected to be the main adopters of pump monitoring solutions.
On the other hand, Technavio has been monitoring the pumps market for oil and gas industry and argues that it is prepared to grow by USD 2.23 billion during 2020-2024.
Progressing at a CAGR (Compound annual growth rate) of almost 4% during the forecast period.
Key conclusions your company should know about
Due to the situation of uncertainty, we find ourselves in, the year 2020 for the global pumps market is expected to decline.
With almost flat market prospects for both new orders and aftermarket services.
The Asia-Pacific and North America region, which have higher investment activity, are likely to be affected when both active and new projects are stopped.
Major end-user industries such as water and wastewater, oil & gas and chemical, which contributed to the increase in pump incomes in 2019, are expected to remain passive due to the prevalence of economic instability in 2020.
It would be interesting for your company as a pump manufacturer, to continue redefining its business model and focus on positioning your enterprise as pumps-as-a-service.
This will enable your pump manufacturer company to unlock revenue streams and hold a competitive edge in the market.