The global market for Heat Exchangers is forecast to reach US$27 billion by 2024 supported by opportunities for growth despite the challenges posed by the hugely mixed market expectations.
The biggest challenge to growth in the heat exchangers market is the current global economic scenario, which although improving continues to fall short of expectations. Persistent stagnation currently characterizes the global market. Over the last six years, the world economy has managed to recover only less than half of the pre-recession growth, making the 2007-09 recession history's most deepest and protracted recession and recovery. Since the recession, global growth has been stuck in 2.5% to 3.5% range. While the year 2016 ended on a lackluster note, there is hope for a more moderate recovery in the years 2017 and 2018 although threatened by downside risks such as uncertainty cast by the global ramifications of policy changes and ideologies of the new Trump administration in the U.S. and political uncertainties and geopolitical threats in Asia and the Middle East. Also, Europe continues to muddle through its debt crisis with institutional and structural weaknesses that keeps the EU economy locked in a low-growth range. Emerging markets still remain vulnerable to external shocks and non-economic factors that can weigh down growth such as terrorism, disease outbreaks, and domestic conflicts. The market therefore faces all the challenges commensurate with a global economy that has been witnessing a prolonged period of slow growth amid numerous downside risks and uncertainties.
Notwithstanding the ever-present challenges confronting the market in the immediate term, outlook for growth nevertheless remains bright led by factors such as stable economic growth in East Asia and South Asia and development of energy infrastructure in these countries, strong manufacturing base and growing government policy led support for upgrades and modernization. The market, especially in the developed regions, will witness greater demand for equipment that complies with strict regulatory and safety norms. Manufacturers therefore will need to routinely enhance the quality and performance of heat exchangers in order to fulfill legislative and other technical requirements. Challenges and opportunities will shape market prospects for companies in the coming years. Amid the threat of cautious CAPEX investments, the moderate pickup in manufacturing and industrial production is fueling confidence by offering the promise of economic stabilization. As capacity pressures intensify, healthy growth is signaled thus improving the outlook for plant upgrades, expansions, CAPEX investments and focus on product and technology innovation. Recovery in oil prices after a prolonged period of slowdown is a positive sign for the market, although the impact of the extended price downturn and the expected slow path to recovery is likely to have a long term impact on new exploration projects and CPAEX decisions. While, the final bottoming out of the mining industry also bodes well for the market, the not-so optimistic forecast for recovery in metal prices infuses temperance and mixed market sentiment.
Europe represents the largest market worldwide. Asia-Pacific ranks as the fastest growing market with a CAGR of 6.1% over the analysis period led by factors such as healthy economic growth in South East Asian countries; rapid industrialization induced growth of the manufacturing sector and positive CAPEX and OPEX investment climate in the sector; and favorable government led policies that prioritize industrial, manufacturing and process sectors for their ability to generate benefits of dynamic economies of scale, innovation/technology diffusion and spillover of a broad range of benefits for the economy and its growth.
Major players in the market include Air Products and Chemicals, Inc., API Heat Transfer, Alfa Laval AB, Tranter Inc., Barriquand Technologies Thermiques, Chicago Bridge & Iron Company N.V., Hamon Group, Harsco Industrial Air-X-Changers, Hisaka Works, Ltd, Kelvion, Sondex, A/S, SmartHeat Inc., SWEP International AB, SPX Corporation, Balcke-Durr GmbH, SPX Cooling Technologies, Inc., SPX FLOW, Inc., Vahterus Oy, and Xylem Inc., among others.