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Analysis of the Global Transformer Market

  • December 2013
  • Frost & Sullivan
Report ID: 1938924


Table of Contents

T&D Infrastructure Investments Drive Demand in Developing Countries

The objective of this study is to analyze the evolving dynamics, trends, and challenges of key technologies in the transmission and distribution space. This research specifically focuses on power & distribution transformers globally. The total market forecast is developed for the major global regions including North America, Europe, APAC, China, Latin America and Rest-of-World. Regional trends and market forecasts are provided for all of these countries. Market share analysis for the total market, power transformer segment and distribution transformer segment has been given independently.

Key Findings

-The global transformer market is primarily driven by capital expenditures in transmission and distribution (T&D) infrastructure development, upgrades, and establishment of new grids due to increasing electricity demand in developing countries and replacement demand in developed ones.
- Asia-Pacific (APAC) is the largest and fastest growing market for power and distribution transformers, especially driven by T&D developments as well as industrial growth in the Southeast Asia (SE Asia) and India markets.
-Japan and Australia-New Zealand (ANZ) are mature markets with a higher demand for replacements. The European and North American markets are expected to have a higher demand for replacements of power transformers during the short to medium terms due to aging of the grid infrastructure, although there has been a slowdown in the recent past.
-China is the world’s second largest transformer market and is expected to witness a high demand for power and distribution transformers due to the demand-supply gap, increase in electricity consumption, high industrial growth, and government support to drive investments in the construction of electricity grids and new capacity installations.
-A trend of consolidation in terms of acquisitions and partnerships is being witnessed among the manufacturers looking to expand their presence globally and provide end-to-end T&D equipment and solutions including transformers.
-The industry also faces stiff competition from Chinese and South Korean manufacturers, with multinationals losing market share due to higher volume sales and low price transformers offered by the Chinese and South Korean manufacturers. Fluctuating raw material prices are affecting transformer pricing. The trend is likely to continue and have a significant impact on the smaller local manufacturers.

CEO’s Perspective

1. The market is dominated by MNCs that face stiff competition from Chinese and South Korean manufacturers, as the latter two sell transformers at a lower price.
2. The efficiency of transformers, along with their price and lead time, is an important determinant in tender specifications.
3. The European, North American, ANZ, and Japanese markets will witness higher replacements of power transformers due to their aging grid infrastructure.
4. India and China are expected to be the key hotspots in higher power and distribution transformer sales due to their higher investments in T&D networks.
5. Green and energy-efficient transformers are gaining increasing importance.

Market Overview

Power Transformer (PT) Analysis
-Power transformers are static electrical equipment that facilitate transfer of power by converting voltages and/or phase configuration to another level.
-They can be configured into single or three-phase. Power generating stations primarily use power transformers (generator transformers) to enhance the voltage of the power produced from the generation voltage level to the transmission voltage level.
-They are an essential component of the transmission system as they adjust the electrical voltage at each segment of power transmission, from generation to end users, to a suitable level. They connect transmission systems of higher voltages, usually more than X kV, such as X kV, XkV, X kV, XkV, X kV, X kV, XkV, and so on.
-They are used in step-up and step-down applications usually rated above XMVA.
-Important technical specifications are primary and secondary voltage rating, secondary current rating, maximum power rating, and output. Power transformers are not directly connected to consumers and generally operate at full load with maximum utilization of the core.
-Load fluctuations and copper losses are minimal. Transformers are also segmented based on the insulation material that enables cooling of the transformer and electrical insulation between the internal live parts of the transformers. These include liquid-based and dry-type transformers.

Distribution Transformer (DT) Analysis
-Transformers that are used in low voltage networks for end user connectivity purposes, where industrial and household electrical equipment work up to X kV, are known as distribution transformers.
-They are used to change the feeder voltage to utilization voltage. They are mainly used for power distribution and control application.
-They are available in both single and three-phase configurations. They operate at power ratings of less than X MVA and an output voltage of X kilovolts or less (typically X volts or less).
-The power and voltage rating of the distribution transformers depends on the end-user segment and the power requirement. For example,X kVA to X kVA is used for residential and office buildings. For industrial purposes, X kV is used while for domestic purposes, Xv-Xv is used.
-Important technical specifications are the primary and secondary voltage rating, secondary current rating, maximum power rating, and output. The standard ratings for distribution transformers are X kVA, X kVA, X kVA, X kVA, X kVA, and X kVA.
-These transformers operate at a low efficiency of X-X%.
-They are small in size, easy to install, have lower magnetic losses and are not fully loaded all the time. Similar to power transformers, distribution transformers are available in both liquid-based and dry-type transformers.

Market Definitions

Geographic Coverage: Global
Study Period: 2010–2017
Base Year: 2012
Forecast Period: 2013–2017
Monetary Unit: US Dollars

Forecast Segments
-Global Transformer Revenue: Includes revenue generated from all regions by shipping transformers to the customer site
-Global Transformer Segments: Distribution Transformer: X MVA; >X kV

Regional Segments
-North America includes the United States and Canada
-Latin America includes South America and Mexico
-Europe includes EU27
-APAC includes SE Asia, East Asia, ANZ, and India
-Rest of World (RoW) includes the Middle East, Africa, Russia and Commonwealth of Independent States (CIS) regions

Application Segments
Market Segmentation based on End Users:
-Industrial buildings and commercial establishments, large-scale industries such as oil and gas, mining, refining etc., institutions, residential sectors, and others

Key Questions This Study Will Answer

Is the market growing? How long will it continue to grow, and at what rate?
What are the factors influencing growth of the global transformer market and to what extent?
Are the products/services currently offered meeting customer needs, or is additional development required?
What are the factors influencing the growth of power and distribution transformers in various regions such as North America, Latin America, Europe, APAC, China, and RoW and to what extent?
What are the various T&D regional trends and the future trends in various countries? How will the market structure change with time?
Will major and minor competitors continue to exist, or will they get acquired by other companies?

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