East African Genset Market Poised for High Growth Due to the Power Crisis, Notes Frost & Sullivan

Aug 30, 2010, 04:00 ET from Frost & Sullivan

CAPE TOWN, South Africa, Aug. 30 /PRNewswire/ -- The East African region is fraught with seasonal droughts and a consequent power crisis. This crisis, coupled with an expected rise in economic growth in the region, is the main driver for growth in the East African genset market. The sectors that are experiencing significant growth include, but are not limited to, telecommunications, manufacturing, mining, commercial, and construction.

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New analysis from Frost & Sullivan (http://www.energy.frost.com), The East African Genset Market, finds that the market earned revenues of $54.4 million in 2009 and estimates this to reach $212 million in 2014. The end-user sectors covered in this study include industrial and commercial, mining and construction, telecommunications and agricultural.

If you are interested in more information on this study, please send an e-mail to Patrick Cairns, Corporate Communications, at patrick.cairns@frost.com, with your full name, company name, title, telephone number, company e-mail address, company website, city, state and country.

"The water levels in the major dams feeding the hydro power stations in the region have drastically decreased, stepping-up the need for gensets," says Frost & Sullivan Research Analyst Salima Zyambo. "Additionally, economic growth ranging between 4 and 8 per cent is expected in the long-term as East Africa embarks on economic development programmes, further creating a demand for gensets."

Infrastructure development, road construction and industrial expansions have led to an increase in the use of gensets, both as a source of prime power and stand-by power.

However, market growth is hampered by lack of quality control regulations – a major growth restraint in the genset market for original equipment manufacturers (OEMs). Furthermore, OEMs from Europe and North America are facing stiff competition from their Asian counterparts, who are able to supply gensets of increasingly good quality at competitive prices.

"The market is flooded with gensets of varying quality and prices as a direct result of the lack of quality control regulations in the region," explains Zyambo. "With the demand for gensets expected to rise as the region's economy grows, more equipment suppliers are entering the market."

Product quality and efficient after-sales services are however fast replacing product price as the key differentiating factors in the genset market. Offering a wide variety of product brands to customers is another critical success factor that will reduce the probability of customers switching to other suppliers.

"Equipment suppliers who can ensure efficient service delivery, product quality and cost competitiveness are in a better position to capture and grow their market share," concludes Zyambo. "This can be achieved by either opening more outlets or working in conjunction with existing equipment stores."

The East African Genset Market is part of the Energy & Power Growth Partnership Services programme, which also includes research in the following markets: The Sub-Saharan Africa Large Diesel Generation Markets and Power Rental in Key African Markets. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

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The East African Genset Market

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Contact:

Patrick Cairns

Corporate Communications – Africa

P: +27 18 464 2402

E: patrick.cairns@frost.com


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SOURCE Frost & Sullivan



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