Diesel Gensets Market in Europe 2014-2018 PDF

2014-2018
Diesel Gensets Market in Europe

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2014-2018
2014-2018 Diesel Gensets Market in Europe

01. Executive Summary .............................................. 1
02. List of Abbreviations .............................................. 2
03. Scope of the Report .............................................. 3
03.1 Market Overview ................................................................. 3
03.2 Product Offerings ................................................................. 3
04. Market Research Methodology ........................... 4
04.1 Market Research Process ................................................... 4
04.2 Research Methodology ...................................................... 4
05. Introduction ........................................................... 6
06. Market Landscape ................................................ 7
06.1 Market Overview ................................................................. 7
06.2 Market Size and Forecast ................................................... 8
06.3 Five Forces Analysis ............................................................ 9
07. Market Segmentation by Application ............... 11
07.1 Standby Application Segment ......................................... 12
07.1.1 Market Size and Forecast ....................................................................... 12
07.2 Prime Power Application Segment .................................. 13
07.3 Peak Shaving Application Segment ............................... 14
08. Market Segmentation by Product ..................... 15
CONTENTS

2014-2018
08.1 Under 60 kW Segment ...................................................... 16
08.2 60 kW-300 kW Segment .................................................... 17
08.3 300 kW-1 MW Segment ..................................................... 18
08.4 1 MW and Above Segment .............................................. 19
09. Market Segmentation by End-users .................. 20
09.1 Industrial Sector ................................................................. 21
09.2 Commercial Sector ........................................................... 22
09.3 Infrastructure Sector .......................................................... 23
09.4 Residential Sector .............................................................. 24
10. Key Leading Countries ....................................... 25
10.1 Spain ................................................................................... 25
10.2 Italy ..................................................................................... 26
10.3 Germany ............................................................................ 26
11. Buying Criteria ..................................................... 27
12. Market Growth Drivers ........................................ 28
13. Drivers and their Impact ..................................... 30
14. Market Challenges ............................................. 31

2014-2018
15. Impact of Drivers and Challenges ..................... 33
16. Market Trends ...................................................... 34
17. Trends and their Impact ..................................... 36
18. Vendor Landscape ............................................. 37
18.1 Competitive Scenario ....................................................... 37
18.1.1 Mergers and Acquisitions ....................................................................... 37
18.2 Market Share Analysis 2013 ............................................. 38
18.3 Other Prominent Vendors ................................................. 39
19. Key Vendor Analysis ........................................... 40
19.1 Caterpillar Inc. ................................................................... 40
19.1.1 Business Overview .................................................................................... 40
19.1.2 Business Segmentation ........................................................................... 41
19.1.3 Key Information ........................................................................................ 41
19.1.4 SWOT Analysis ........................................................................................... 42
19.2 Cummins Inc. ..................................................................... 43
19.2.2 Business Segments ................................................................................... 43
19.2.3 Key Information ........................................................................................ 44
19.2.4 SWOT Analysis ........................................................................................... 45
19.3 Kohler Co. .......................................................................... 46
19.3.2 Business Segments ................................................................................... 46
19.3.3 Key Information ........................................................................................ 47
19.3.4 SWOT Analysis ........................................................................................... 48
20. Other Reports in this Series ................................. 49

2014-2018

Exhibit 1: Market Research Methodology ....................................... 4
Exhibit 2: Segmentation of Diesel Gensets 2013 ............................. 7
Exhibit 3: The Diesel Gensets Market in Europe 2013-2018
(US$ billion) ........................................................................ 8
Exhibit 4: Diesel Gensets Market in Europe by Application
Segmentation 2013-2018 ................................................ 11
Exhibit 5: Diesel Gensets Market in Europe by Standby
Application Segment 2013-2018 (US$ million) .............. 12
Exhibit 6: Diesel Gensets Market in Europe by Prime
Power Application Segment 2013-2018 (US$
million) .............................................................................. 13
Exhibit 7: Diesel Gensets Market in Europe by Peak
Shaving Application Segment 2013-2018 (US$
million) .............................................................................. 14
Exhibit 8: Diesel Gensets Market in Europe by Product
Segmentation 2013-2018 ................................................ 15
Exhibit 9: Diesel Gensets Market in Europe by Under 60
kW Segment 2013-2018 (US$ million) ............................. 16
Exhibit 10: Diesel Gensets Market in Europe by 60 kW-300
kW Segment 2013-2018 (US$ million) ............................. 17
Exhibit 11: Diesel Gensets Market in Europe by 300kW-
1MW Segment 2013-2018 (US$ million) .......................... 18
EXHIBITS

2014-2018
Exhibit 12: Diesel Gensets Market in Europe by 1 MW and
Above Segment 2013-2018 (US$ million) ....................... 19
Exhibit 13: Diesel Gensets Market in Europe by End-users
Segmentation 2013-2018 ................................................ 20
Exhibit 14: Diesel Gensets Market in Europe by Industrial
Sector 2013-2018 (US$ million) ....................................... 21
Exhibit 15: Diesel Gensets Market in Europe by
Commercial Sector 2013-2018 (US$ million) ................. 22
Exhibit 16: Diesel Gensets Market by Infrastructure Sector
2013-2018 (US$ million) ................................................... 23
Exhibit 17: Diesel Gensets Market in Europe by Residential
Sector 2013-2018 (US$ million) ....................................... 24
Exhibit 18: Diesel Gensets Market in Europe by Vendor
Segmentation 2013 .......................................................... 38
Exhibit 19: Business Segmentation of Caterpillar Inc. ..................... 41
Exhibit 20: Business Segmentation of Cummins Inc. ....................... 43
Exhibit 21: Business Segmentation of Kohler Co.............................. 46


1
01. Executive Summary
Market Size
2013: US$1.26 billion
2018: US$1.59 billion
Market Growth Rate
2014: 3.97 percent
2018: 5.80 percent
CAGR 4.79 percent
Geography Europe
Key Leading Countries
Spain
Italy
Germany
Key Customer Segments
Industrial Sector
Commercial Sector
Infrastructure Sector
Residential Sector
Key Market Drivers
Increasing Public Infrastructure Projects
Increasing Demand for Generators from Industrial Sector
Increasing Demand for Generators from Commercial Sector
Increasing Demand for Energy in Europe
Key Market Challenges
Increasing Regulation on Environmental Conservation
Rising Demand and Use of Gas Gensets
Increasing Sale of Used Diesel Gensets
Increasing Diesel Prices
Key Market Trends
Increasing Focus of Vendors on Eastern European Market
Increasing Demand for Hybrid Generators
Increasing Product Differentiation
Increasing Number of Mergers and Acquisitions
Key Buying Criteria
Price
Maintenance
Efficiency
Advanced Features
Key Vendors
Caterpillar Inc.
Cummins Inc.
Kohler Co.


2
02. List of Abbreviations
EU - European Union
IT - Information Technology
kVA - kilo-volt-amperes
kW - Kilowatt
MW - Megawatt


3
03. Scope of the Report
03.1 Market Overview
This report covers the present scenario and the growth prospects of the Diesel Gensets market in
Europe for the period 2014-2018. It considers 2013 as the base year and provides data for the
trailing 12 months. To calculate the market size, the report considers revenue generated from
sales of diesel gensets in Europe.
The report also presents the vendor landscape and a corresponding detailed analysis of the top
three vendors in the market in Europe. In addition, it discusses the major drivers that influence the
growth of the market. It also outlines the challenges faced by the vendors and the market at
large, and the key trends that are emerging in the market.
03.2 Product Offerings
Some of the products offered by the major vendors in the Diesel Gensets market in Europe 2014-
2018 are listed below:
Company Products Offered
Caterpillar Inc. FG Wilson Series
CAT Product Series
Cummins Inc. Cummins Power Generation D1703
Light Commercial Generators series
Cummins Commercial Quiet Diesel and Standard Diesel series
Cummins Onan Quiet Diesel series
Rental Diesel Generators series
Kohler Co. REOZ series


4
04. Market Research Methodology
04.1 Market Research Process
TechNavio has collected key data related to the Diesel Gensets market in Europe and analyzed
these data using a variety of methods. The market dynamics have been ascertained following a
detailed study of the micro, meso, and macroeconomic indicators of the market.

04.2 Research Methodology
This report is based on in-depth qualitative and quantitative analyses of the Diesel Gensets
market in Europe. The quantitative analysis involved the application of various projection and
sampling techniques. The qualitative analysis involved primary interviews, surveys, and vendor
briefings. The data gathered as a result of these processes were validated through experts'
opinions.
Exhibit 1: Market Research Methodology

Source: TechNavio Analysis
Diesel Gensets
Market in Europe
2014-2018

5
Based on the research results and technical insights thus gathered, TechNavio analysts have
provided a comprehensive analysis of the varied aspects of the market. The impact of global
economic conditions and other macroeconomic indicators was also considered while assessing
the market.


6
05. Introduction
Diesel generators are devices that convert mechanical energy into electrical energy using
diesel as a fuel. Generators are used to provide continuous power supply to various end-users.
Diesel generators are segmented based on their application such as Standby, Prime Power, and
Peak Shaving. The end-users of the diesel gensets are the Industrial sector, the Commercial
sector, the Infrastructure sector, and the Residential sector.
The Diesel Gensets market in Europe is expected to witness a steady growth rate and overall the
market is expected to grow at a CAGR of 4.79 percent during the forecast period. The market is
dominated by three major players: Caterpillar Inc., Cummins Inc., and Kohler Co. In terms of
end-users, the market is dominated by the Commercial sector, followed by the Industrial sector.
The majority of the market growth stems from Spain, Italy, and Germany.
The Diesel Gensets market in Europe is driven by several factors. One of the major drivers is the
increasing public infrastructure project. The increasing construction of railways and airports in
European countries has boosted the demand for diesel gensets. Moreover, the increasing
transport infrastructure projects also led to the increasing demand for diesel gensets in Europe.
Another major driver is the increasing demand for generators from the Industrial sector.
Despite the presence of several drivers, the growth of the market is curtailed by several
challenges. One of the major challenges in the market is the increasing regulation on
environmental conservation. Diesel generators emit harmful substances such as nitrogen oxide,
carbon monoxide, and hydrocarbons. This has led the EU to pass stringent rules and regulations
pertaining to the control of the emission of gases and noise generated by the diesel generators.
Another major challenge is the rising demand and use of gas gensets.
Despite the presence of serious challenges, the Diesel Gensets market in Europe is witnessing
several emerging trends in the market. One of the major trends in the market is the increasing
focus of vendors on the Eastern European market. The rapid urbanization of the Eastern
European countries has led to more diesel gensets vendors coming into the market. Thus, the
combined effect of various trends and drivers is expected to exert a positive influence on the
market in Europe during the forecast period.


7
06. Market Landscape
06.1 Market Overview
The diesel gensets are comprised mainly of a diesel engine and a generator. The diesel gensets
are used by various sectors such as Commercial, Industrial, Infrastructural, and Residential.
Exhibit 2: Segmentation of Diesel Gensets 2013

The growing demand for diesel gensets in Europe is due to the increasing demand for energy.
The vendors in the market provide diesel gensets which can generate power ranging from 5.5
kVA-22 kVA and 600 kVA-2.7 MW. In 2013, Spain, Italy, and Germany accounts for the largest
market share of the market in Europe.

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Diesel Engine
Generator

8
06.2 Market Size and Forecast
The Global Gensets market in Europe was valued at US$1.26 billion in 2013 and it is expected to
reach US$1.59 billion by 2018, growing at a CAGR of 4.79 percent.
Exhibit 3: The Diesel Gensets Market in Europe 2013-2018 (US$ billion)

The Diesel Gensets market in Europe is expected to grow at a steady rate during the forecast
period. The various public infrastructure projects undertaken in Europe have contributed to the
growth of the market. For instance, the increasing construction of railways and airports in
Germany boosted the demand for diesel gensets. Poland, the Czech Republic, and Hungary
also witnessed an increasing number of manufacturing facilities being set up that require
continuous power supply. For instance, in Poland, the increase in the construction of warehouses
and offices has led to an increasing demand for electricity, which in turn has led to the demand
for diesel gensets. The increasing residential construction in Eastern European countries has also
led to the demand for diesel gensets, thereby increasing the growth of the Diesel Gensets
market in Europe. Moreover, the increase in the consumption of energy for various new
applications such as the establishment of a new factory is giving rise to the need for an
uninterrupted power supply. Thus, the demand-supply gap for energy is widening, giving rise to
the need for diesel gensets.


9
06.3 Five Forces Analysis

Threat of Rivalry
(High)
The market is dominated by
few large vendors. The
vendors are trying to
differentiate their product to
sustain competition. Hence,
the threat of rivalry is high.
Bargaining Power of
Suppliers
(Medium)
The vendors depend on the
supply of raw materials, parts,
and components from the
supplier to produce efficient
generators. Hence, the
bargaining power of suppliers
is high.
Bargaining Power of
Buyers
(Medium)
The products offered by the
vendors involve high
switching costs. Hence, this
reduces the bargaining
power of the buyers.
Threat of New Entrants
(Medium)
The market provides
opportunities for new entrants
as many international vendors
are expected to enter the
market through mergers and
acquisitions.
Threat of Substitutes
(High)
The availability of gas
generators and other
forms of renewable
sources of energy makes
the threat of substitutes
high.

10
Key
The impact of the forces is graded on the basis of the intensity and duration of their impact on
the current market landscape. The magnitude of the impact has been categorized as
described below:
Low - Negligible or no impact on the market landscape
Moderate - Medium-level impact on the market
Moderately High - Significant impact on the growth of the market
High - Very high impact, with radical influence on the growth of the market

11
07. Market Segmentation by Application
The Diesel Gensets market in Europe includes three major application segments:
Standby
Prime Power
Peak Shaving
Exhibit 4: Diesel Gensets Market in Europe by Application Segmentation 2013-2018

In 2013, the Standby application segment accounted for a market share of 83.81 percent and it
is expected to account for 84.48 percent by 2018. The Standby segment contributes significantly
to the growth of the Diesel Gensets market in Europe, because of the increasing demand for a
continuous power supply by various end-users. In 2013, the Prime Power application segment
accounted for a market share of 15.08 percent, and it is expected to account for 14.39 percent
by 2018, followed by the Peak Shaving application segment that accounted for a market share
of 1.11 percent in 2013, and which is expected to account for a 1.13 percent by 2018.


12
07.1 Standby Application Segment
07.1.1 Market Size and Forecast
The Standby segment is valued at US$1,056 million in 2013 and it is expected to reach US$1,345
million by 2018, growing at a CAGR of 4.96 percent.
Exhibit 5: Diesel Gensets Market in Europe by Standby Application Segment 2013-
2018 (US$ million)

The demand for electricity in data centers in Europe has led to the increasing demand for diesel
gensets. The increasing growth of the Automotive industry in Eastern Europe has increasing the
demand for diesel gensets, thereby increasing the growth of the Diesel Gensets market in
Europe. Moreover, the Commercial sector is increasingly using diesel gensets for backup power
supply.


13
07.2 Prime Power Application Segment
The Prime Power segment is valued at US$190.01 million in 2013 and it is expected to reach
US$229.01 million by 2018, growing at a CAGR of 3.80 percent.
Exhibit 6: Diesel Gensets Market in Europe by Prime Power Application Segment
2013-2018 (US$ million)

The Prime Power segment accounts for a share of 15.08 percent of the Diesel Gensets market in
Europe in 2013. This segment is driven by the increasing demand for diesel gensets by the
Industrial sectors. Poland, the Czech Republic, and Hungary have witnessed an increasing
number of manufacturing facilities being established due to the availability of low-cost labor,
and increasing foreign investment. The manufacturing bases require continuous power supply to
carry out the production process, which in turn increases the demand for diesel gensets.


14
07.3 Peak Shaving Application Segment
The Peak Shaving segment is valued at US$13.99 million in 2013 and it is expected to reach
Exhibit 7: Diesel Gensets Market in Europe by Peak Shaving Application Segment
2013-2018 (US$ million)

The Peak Shaving segment is a relatively small segment of the Diesel Gensets market in Europe.
This segment accounted for a share of 1.11 percent of the market in 2013. The segment involves
the seasonal demand of diesel gensets, which implies that diesel gensets are used only in a
particular season, for instance during the summer for air conditioning purposes in many
European countries.


15
08. Market Segmentation by Product
The Diesel Gensets market in Europe includes four major product segments:
Under 60 kW
60 kW-300 kW
300 kW-1 MW
1 MW and Above
Exhibit 8: Diesel Gensets Market in Europe by Product Segmentation 2013-2018

The 60 kW-300 kW segment accounted for the highest share i.e. 48.15 percent of the Diesel
Gensets market in Europe. The increasing use of 60 kW-300 kW power by the Industrial and
Commercial sectors for standby application has led this segment to occupy the largest share in
the market. The Under 60 kW segment accounted for the second largest share i.e. 27.93 percent
of the market, followed by 1 MW & Above and 300 kW-1 MW with 13.09 percent and 10.83
percent of the market, respectively.


16
08.1 Under 60 kW Segment
The Under 60 kW segment is valued at US$351.88 million in 2013 and it is expected to reach
Exhibit 9: Diesel Gensets Market in Europe by Under 60 kW Segment 2013-2018 (US$
million)

The growth of the diesel gensets that generate power under 60 kW is mainly due to the
increasing demand for the under 60 kW power diesel gensets by the Commercial and
Residential sectors.


17
08.2 60 kW-300 kW Segment
The 60 kW-300 kW segment is valued at US$606.69 million in 2013 and it is expected to reach
Exhibit 10: Diesel Gensets Market in Europe by 60 kW-300 kW Segment 2013-2018 (US$
million)

The Industrial and Commercial sectors are increasingly using 60 kW-300 kW power diesel gensets
for standby application, thus helping the segment to occupy the largest share in the market.


18
08.3 300 kW-1 MW Segment
The 300 kW-1 MW segment is valued at US$136.48 million in 2013 and it is expected to reach
Exhibit 11: Diesel Gensets Market in Europe by 300kW-1MW Segment 2013-2018 (US$
million)

The demand for diesel gensets with power ranges of 300 kW-1 MW is majorly driven by the
Industrial sector. The establishment of new manufacturing bases in Poland, the Czech Republic,
and Hungary has led to the increasing demand for 300 kW-1 MW power diesel generators.


19
08.4 1 MW and Above Segment
The 1 MW and Above segment is valued at US$164.95 million in 2013 and it is expected to reach
Exhibit 12: Diesel Gensets Market in Europe by 1 MW and Above Segment 2013-2018
(US$ million)


The demand for diesel gensets with power ranges of 1 MW and above is majorly driven by the
Industrial and Infrastructure sectors. The increasing construction of railways and airports in
Germany has boosted the demand for 1 MW and above power diesel gensets. In Spain, the
increasing transport infrastructure projects have also led to the increasing demand for 1 MW and
above power diesel gensets.


20
09. Market Segmentation by End-users
The Diesel Gensets market in Europe includes four major end-users as given below:
Industrial Sector
Commercial Sector
Residential Sector
Exhibit 13: Diesel Gensets Market in Europe by End-users Segmentation 2013-2018

The market is driven by the Commercial sector, which accounts for a market share of 40.56
percent in 2013. There is an increasing demand for diesel gensets from the Commercial sector.
Although the market receives a significant portion of its revenue from the Commercial sector,
the Industrial and Infrastructure sector are also growing rapidly and accounted for considerable
shares in the market.
The Industrial sector accounts for a market share of 33.10 percent, followed by the Infrastructure
sector with a market share of 15.56 percent and the Residential sector with a market share of
10.78 percent in 2013.


21
09.1 Industrial Sector
The Industrial sector is valued at US$417 million in 2013 and it is expected to reach US$532 million
by 2018, growing at a CAGR of 4.99 percent.
Exhibit 14: Diesel Gensets Market in Europe by Industrial Sector 2013-2018 (US$ million)

The factor contributing to the growth of the Industrial sector is the increasing growth of the
Manufacturing industry in Eastern Europe, which increased the demand for diesel gensets.
Industries are increasingly using 60 kW-300 kW diesel genset power for standby application,
which has also contributed significantly to the overall revenue of the Industrial sector.


22
09.2 Commercial Sector
The Commercial sector is valued at US$511 million in 2013 and it is expected to reach US$647
Exhibit 15: Diesel Gensets Market in Europe by Commercial Sector 2013-2018 (US$
million)

The Commercial sector accounted for the highest share in the overall market. In Poland, the
increasing construction of warehouses and offices has led to the growing demand for electricity,
which in turn has led to the demand for diesel gensets. The development of IT in Europe led to
the emergence of large numbers of data centers which require continuous power supply
thereby increasing the demand for diesel gensets.


23
09.3 Infrastructure Sector
The Infrastructure sector was valued at US$196 million in 2013 and it is expected to reach US$248
Exhibit 16: Diesel Gensets Market by Infrastructure Sector 2013-2018 (US$ million)

The increasing construction of railways and airports in Germany boosted the demand for diesel
gensets. In Spain, the increasing transport infrastructure projects also led to the growth of the
market. Furthermore, the rapid urbanization of the Eastern European region has led to the
increasing demand for diesel gensets for construction activities.


24
09.4 Residential Sector
The Residential sector is valued at US$136 million in 2013 and it is expected to reach US$165
Exhibit 17: Diesel Gensets Market in Europe by Residential Sector 2013-2018 (US$
million)

There is an increasing demand for the under 60 kW power diesel gensets by the Residential
sector that has contributed to the growth of the sector. However, the growth is expected to
decline in 2018, as the supply of main power is expected to increase with high reliability.

25
10. Key Leading Countries
The leading countries in the Diesel Gensets market in Europe in 2013 are given below:

10.1 Spain
Spain was the major contributor in the Diesel Gensets market in Europe with 21.12 percent of the
market. Spain will continue to be the largest market during the forecast period and has a
number of infrastructure projects under the planning and development phase.

Major Driver
Increasing demand
for 60 kW-300 kW
power diesel gensets
for standby
application by
Commercial and
Industrial sectors
Major Challenge
Increasing use of wind
power to generate
electricity
Major Trend
Increasing number of
foreign and domestic
players in the market
Spain
21.12 percent
Italy
16.59 percent
Germany
15.22 percent

26
10.2 Italy
Italy was the second major contributor in the Diesel Gensets market in Europe with 16.59 percent
of the market. Italy is one of the fastest growing countries in the market in Western Europe. The
market generates a large part of its revenue from the Commercial sector, which is driven by the
Standby application segment.

10.3 Germany
Germany was the third major contributor in the Diesel Gensets market in Europe with 15.22
percent of the market. The market generated a large part of its revenue from the Commercial
sector, followed by the Industrial sector.

Major Driver
Increasing demand for
diesel gensets for
standby application by
Commercial sector
Major Challenge
Strict adherence of new
environmental rules and
regulations
Major Trend
hybrid generators in
Italy's Diesel Gensets
market
Major Driver
60 kW-300 kW power
and 300 kW-1 MW
power diesel gensets
for standby and prime
power application by
Commercial and
Industrial sectors
Major Challenge
Major Trend
Continuous
development of new
products like Free-Piston
Linear Genereator in the
German Diesel Gensets
market

27
11. Buying Criteria
Parameter Details End-user Segments Significance Attached
Price

The ability to provide
generators at affordable
price.
Industrial Sector

Commercial Sector


Maintenance
The diesel gensets should
involve minimal
maintenance
requirements and the
time taken should be less.
Industrial Sector

Commercial Sector


Efficiency
optimal output with
minimal fuel consumption.
Industrial Sector

Commercial Sector


Advanced
Features
advanced features such
as integrated monitoring
systems and customized
generators.
Industrial Sector

Commercial Sector


Key
The impact of the buying criteria is graded on the basis of the intensity and duration of their
impact on the current market landscape. The magnitude of the impact has been categorized
as described below:
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5

28
12. Market Growth Drivers
The Diesel Gensets market in Europe is driven by several factors. One of the major drivers is the
increasing public infrastructure project. The increasing construction of railways and airports in
European countries has boosted the demand for diesel gensets. Moreover, the increasing
transport infrastructure projects also led to the increasing demand for diesel gensets in Europe.
Another major driver is the increasing demand for generators from the Industrial sector.
Some of the major growth drivers in the Diesel Gensets market in Europe are discussed below:
Increasing Demand for Generators from Commercial Sector
The various public infrastructure projects undertaken in Europe have contributed to the growth
of the Diesel Gensets market in Europe. In Spain, the rising transport infrastructure projects have
led to the growth of the market. The rapid development of the Eastern European region also led
to a high demand for diesel gensets for construction as well as commercial activities. Moreover,
a significant amount of capital has been invested by the EU in various public infrastructure
projects such as highways, railways, seaports, and airport construction, the undertaking of which
has increased the demand for diesel gensets in Europe.
The Industrial sectors such as the Manufacturing and Process industries in Europe are some of the
main consumers of diesel gensets. Additionally, Poland, the Czech Republic, and Hungary have
been witnessing a rise in the establishment of manufacturing facilities due to the availability of
low-cost labor and increase in foreign investment. Also, the manufacturing bases require
continuous power supply to carry out the production process, which in turn increases the
demand for diesel gensets. Thus, the increasing demand from the Industrial sector has increased
the growth of the Diesel Gensets market in Europe.
Increasing Demand for Generator from Commercial Sector
The rapid growth of the IT industry has led to the commencement of large numbers of data
centers. Hence, the demand for electricity in data centers in Europe has led to the increasing
demand for diesel gensets. Similarly, in Poland the increasing construction of warehouses and

29
offices has led to the growing demand for electricity, which in turn has led to the demand for
diesel gensets.
There is a huge demand and supply gap for energy in Europe, which has led to the increasing
demand for diesel gensets in the country. Currently, various new applications are increasingly
consuming energy, which on the one hand is leading to a shortage of energy, yet on the other
hand is giving rise to the need for uninterrupted power supply. In order to overcome this
shortage of energy and achieve continuous power supply the European countries have been
continuously using diesel generators as a source of power, thereby increasing the growth of the
Diesel Gensets market in Europe.


30
13. Drivers and their Impact
Driver
Impact on Key Customer Category
Industrial Commercial Infrastructure
Increasing Public
Infrastructure Project

Increasing Demand for
Generators from Industrial
Sector

Generators from
Commercial Sector

Energy in Europe

Key
The impact of the drivers is graded on the basis of the intensity and duration of the impact on
their current market landscape. The magnitude of the impact has been categorized as
described below:
Medium - Medium-level impact on the market
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5
Low High
1 2 3 4 5

31
14. Market Challenges
Despite the presence of several drivers, the growth of the market is curtailed by several
challenges. One of the major challenges in the market is the increasing regulation on
environmental conservation. Diesel generators emit harmful substances such as nitrogen oxide,
carbon monoxide, and hydrocarbons. This has led the EU to pass stringent rules and regulations
pertaining to the control of the emission of gases and noise generated by the diesel generators.
Another major challenge is the rising demand and use of gas gensets.
Some of the major challenges in the Diesel Gensets market in Europe are discussed below:
The EU has set up stringent regulations and guidelines on environmental conservation, which has
had a negative impact on the growth of the Diesel Gensets market in Europe. The vendors need
to comply with the new rules and regulations being passed on the emission of harmful
substances such as nitrogen oxide, carbon monoxide, and hydrocarbons. Thus, the vendors are
developing environmental friendly diesel generators, which consume less fuel and emit less
carbon dioxide and other greenhouse gases. Hence, the stringent rules and regulations have an
adverse effect on the growth of the Diesel Gensets market in Europe.
The reason behind rising demand for gas gensets is that they emit less carbon dioxide and other
greenhouse gases compared to diesel gensets. Many sectors are now using gas gensets, and,
therefore, the vendors are focusing more on manufacturing gas rather than diesel gensets. In
the past few years, the Industrial and Infrastructure sectors have started adopting gas
generators as they offer more efficiency and productivity as compared to diesel generators.
Thus, the increasing growth in gas gensets provides an alternative for the sectors to switch from
diesel to gas gensets.
The increasing sale of used diesel gensets imposes a serious threat to the diesel gensets
manufacturers. Used diesel gensets sold by rental companies are gaining popularity in Europe.
The availability of used diesel gensets at a low cost compared to original diesel gensets is the

32
main driving factor on the increasing demand for used diesel gensets. This increasing demand
imposes serious pressure on the manufacturer and the pricing of the product, which directly
affects the growth of the Diesel Gensets market in Europe.
Currently, the price of diesel gensets is high due to the increasing price of diesel. The price of
diesel has increased drastically, especially in the last couple of years, therefore resulting in a
dramatic decline in the overall profit margins of the vendors. Moreover, vendors need to
change their product pricing strategy, which affects their overall revenue generation and R&D
investment. Also, the end-users require consistent maintenance and support from vendors, which
in turn increases the overall cost of ownership for the vendors. All these factors impact the
revenue of the vendors, thereby affecting the overall market.


33
15. Impact of Drivers and Challenges

Key
The impact of the drivers and challenges is graded on the basis of the intensity and duration of
their impact on the current market landscape. The magnitude of the impact has been
categorized as described below:
Moderately High - Significant impact on the growth of the market

34
16. Market Trends
Despite the presence of serious challenges, the Diesel Gensets market in Europe is witnessing
several emerging trends in the market. One of the major trends in the market is the increasing
focus of vendors on the Eastern European market. The rapid urbanization of the Eastern
European countries has led to more diesel gensets vendors coming into the market.
Some of the key trends in the Diesel Gensets market in Europe are discussed below:

The rapid urbanization of the Eastern European countries has led to more diesel gensets vendors
entering the Eastern European market. The market provides more opportunities to these vendors
because of the increasing infrastructure and industrial activities. The increasing development
activities in Poland, the Czech Republic, Hungary, Russia, and Croatia have helped the vendors
to shift their business or marketing strategy toward the European market.
The Diesel Gensets market in Europe is witnessing an increasing trend in the demand for hybrid
generators, which run both on gas and diesel. Hybrid generators offer more cost and fuel
efficiency as compared to conventional generators. Unlike diesel generators, a hybrid generator
emits less harmful substances such as nitrogen oxide, carbon monoxide, and hydrocarbons.
Thus, the increasing demand for hybrid generators is expected to increase the growth of the
overall market.
The vendors are producing new products to differentiate themselves from the competitors.
Generators with comprehensive control and monitoring systems are being developed by a few
vendors, and this increases the overall efficiency of the generator. Similarly, user-friendly
generators are being developed by the vendors, which allow the end-users to operate the
generator easily, and without any proper technical knowledge.

35
The Diesel Gensets market in Europe provides opportunities for new mergers and acquisitions for
large vendors. As the market is highly fragmented with the presence of many international and
local vendors, there is intense competition. Vendors are trying to expand their market share and
their distribution channels through creating alliances with regional, small, and large companies.
Many vendors are also expected to acquire small and domestic suppliers during the forecast
period.


36
17. Trends and their Impact

Key
The impact of the trends is graded on the basis of the intensity and duration of their impact on
the current market landscape. The magnitude of the impact has been categorized as
described below:

37
18. Vendor Landscape
18.1 Competitive Scenario
The Diesel Gensets market in Europe is highly fragmented with the presence of several large
vendors. Although the market includes a huge number of local vendors, it is dominated by few
major vendors. Many foreign vendors are expected to enter the market, as it provides more
opportunity to reap higher revenue when compared to other regions.
The major vendors in the market are Caterpillar Inc., Cummins Inc., and Kohler Co. The
increasing demand for power in Europe results in intense competition among these vendors.
Caterpillar Inc. dominates the Diesel Gensets market in Europe followed by Cummins Inc. and
Kohler Co., respectively. In order to sustain and grow in the market, the vendors are striving to
develop new equipment that is different from their competitors.
The vendors are trying to beat their competitors through various new innovative products,
increasing capacity, and grabbing new opportunities.
18.1.1 Mergers and Acquisitions
May, 2012: Cummins Inc. bought SCR doser technology from Hilite International
March, 2012: Kohler Co. acquired Maquigeral Industria e Comercio de Maquinas Ltda, a
Brazilian generator manufacturer
November 2011: Caterpillar Inc. acquired MWM Holdings GmbH
July 2011: Caterpillar Inc. acquired Bucyrus International Inc., a key leading mining
equipment provider in the market


38
18.2 Market Share Analysis 2013
Caterpillar was the leader in the Diesel Gensets market in Europe in 2013, and accounted for a
market share of 27-30 percent. This company offers large diesel generators to various industries. It
holds a strong position in the Industrial sector of this market. In addition, it has strategic
partnerships with other vendors in the market for technological advancements and product
distribution.
Exhibit 18: Diesel Gensets Market in Europe by Vendor Segmentation 2013

Cummins Inc. occupied the second largest share in the Diesel Gensets market in Europe and
accounted for a market share of 15-18 percent in 2013. The company offers a wide range of
engines and other power-generating products to various industries. It sells a majority of its
generators to the Commercial and Industrial sectors.
Kohler Co. occupied the third largest share in the Diesel Gensets market in Europe, with a market
share of 10-13 percent in 2013. The company has a good customer reach in the Residential
sector of the market. It also offers diesel gensets for rent to its end-users. In addition, it offers
towable generators, transfer switches, switchgear, and controls for standby, prime, and energy
management applications.


39
18.3 Other Prominent Vendors
Company Description
ABB Ltd. Global industrial automation technology
provider
GE Co. Global infrastructure and IT technology
provider
Siemens AG Global infrastructure and IT technology
provider


40
19. Key Vendor Analysis
19.1 Caterpillar Inc.
19.1.1 Business Overview
Caterpillar Inc. is one of the largest construction machinery and mining equipment
manufacturers in the world. The company has presence in more than 182 countries with more
than 180 dealers across the world. Through the acquisition of Bucyrus International Inc. in July
2011, the company enhanced its product portfolio.
The company offers a wide range of products and services through five major business
segments: Energy and Power Systems, Construction Industries, Resource Industries, Financial
Products, and Others. It offers a wide range of power generators and power engines through its
Energy and Power Systems segment.
The company reported revenue of US$65.88 billion in FY2012, which was 9.54 percent higher than
its revenue in FY2011. The company generated US$21.12 billion in FY2012 from the Energy and
Power Systems segment, which accounted for 32 percent of the company's overall revenue. This
segment generated 41.3 percent of its overall revenue from North America and more than 28
percent from the EMEA region in FY2012.
The company is investing heavily to expand its business. Some of the major business expansions
by the company in 2011 were the acquisition of Bucyrus, the development of an axle-
manufacturing facility, its investment of more than US$600 in large mining and truck
manufacturing activities, and a new manufacturing plant in Indonesia.


41
19.1.2 Business Segmentation
Exhibit 19: Business Segmentation of Caterpillar Inc.

19.1.3 Key Information
Company Details Description
Product Portfolio FG Wilson Series
CAT Product Series
Key Mergers and Acquisitions July 2011: Acquired Bucyrus International Inc., a key
leading mining equipment provider in the market
November 2011: Acquired MWM Holdings GmbH


42
19.1.4 SWOT Analysis

Strengths
Caterpillar is the largest vendor in the
Diesel Gensets market in Europe.
The company continues to expand its
business through various mergers and
acquisitions.
The company has a diversified product
portfolio for various industries.

Weaknesses
The company's products are very
expensive.
It relies heavily on industrial users for
revenue generation.

Opportunities
The company offers customized
generators, which gives it a competitive
advantage in the market.
It has a balanced position in both
mature and developing countries in
Europe.

Threats
Large-scale mergers and acquisitions
activity could decline the company's
profitability.
The increasing threat of local vendors in
Europe offering lower priced equipment
may affect the growth of the company.


43
19.2 Cummins Inc.
Cummins Inc. is one of the leading manufacturers of diesel engine generators and engine-
related components. The company is involved in the design, manufacture, and distribution of
diesel and natural gas engines. It also engages in the manufacturing of engine-related
components such as filtration, exhaust after treatment, fuel systems, control systems, air handling
systems, and electric power generation systems. It is headquartered in Columbus, Indiana, and
employs more than 43,900 employees worldwide. This company operates in more than 190
countries. The company has a huge network of company-owned and independent distributors
across the globe. It operates majorly in four business segments: Engine, Components, Power
Generation, and Distribution.
The company reported revenue of US$17,334 million in FY2012, witnessing a decline of 3.96
percent in its revenue of US$18,048 million in FY2011.
19.2.2 Business Segments
Exhibit 20: Business Segmentation of Cummins Inc.


Cummins Inc.
Engine Components
Power
Generation
Distribution

44

Product Cummins Power Generation D1703
Light Commercial Generators
Cummins Commercial Quiet Diesel and Standard
Diesel Series
60 Hz Cummins Onan Quiet Diesel Series RV
Generators
50 Hz Cummins Onan Quiet Diesel Series RV
Generators
Cummins Onan Quiet Diesel Series
Rental Generators
Mergers and Acquisitions May, 2012: Acquired SCR doser technology from Hilite
International

45

Strengths
Cummins Inc. has a diversified product
portfolio for the Commercial and
Industrial sectors.
The company has strong presence
among the commercial and
infrastructure sectors in the Diesel
Gensets market in Europe.
Weakness
The company's products are premium
priced.

Opportunities
The company tries to improve its time-
to-market, which in turn enhances the
company's sales.
The company can collaborate with
external R&D centers and strengthen its
R&D operations.
The company develops hybrid
generators, which could enhance the
company's market potential.

Threat
The increasing threat of low-cost and
local vendors may affect the company
sales and entry strategies in the
European market.


46
19.3 Kohler Co.
Kohler Co., headquartered in Kohler, Wisconsin, US, is a diversified manufacturing company. The
company was established in 1873 and is widely known for its plumbing products, tiles,
generators, and engines. It also has good presence in the Hospitality sector. The company has
52 manufacturing locations across the globe and employs more than 30,000 people across six
continents.
Kohler offers diesel gensets under the Global Power business segment. The company offers diesel
gensets under the combined power brands of SDMO, Kohler Power Systems, and Maquigeral. Its
generators include marine gensets with power ranges of 4 to 500 kW, 10 to 3250 kW industrial -
grade powerhouses, and 8.5 to 125 kW residential standby generators. It also offers towable
generators, transfer switches, switchgear and controls for standby, and prime and energy
management applications. The company reported revenue of approximately US$5 billion in
FY2012.
19.3.2 Business Segments
Exhibit 21: Business Segmentation of Kohler Co.

K
o
h
l
e
r

C
o
.

Kitchen & Bath
Global Power Diesel Gensets
Interiors and
Hospitality
Real Estate

47
Product Portfolio Diesel Generators: 10REOZDC,15REOZDC, 20REOZDC,
20REOZT,125REOZJG,180REOZJG, and 2000ROZMC
Gas generators
Generator controls
Transfer switches
Paralleling system
Towable generators
Key Mergers and Acquisitions March, 2012: Acquired Maquigeral Industria e Comercio
de Maquinas Ltda, a Brazilian generator manufacturer


48

Strengths
Kohler is one of the major vendors in the
Global Diesel Gensets market.
The company offers a wide range of
products to its end-users.
Kohler's Global Power Group has
manufacturing facilities in nine countries
across four continents with sales and
service facilities across the globe.

Weakness
The company is more popular as a
plumbing product manufacturer,
therefore affecting its brand image in
the Diesel Gensets market in Europe.

Opportunity
With its financial strength, the company
can acquire other small and medium
players in the market, which may
improve the overall revenue of the
company.

Threat
Intense competition is one of the
biggest threats for the company. In
addition, Kohler lost US$9.6 million to one
of its competitors, Westerbeke Corp., for
some patent case.


49
20. Other Reports in this Series
Global Machine Safeguarding Solutions Market 2014-2018
Global Air Filter Market 2014-2018
Global Portable Air Conditioning System Market 2014-2018
Power Cables Market in China 2014-2018
Global Machine Safeguarding Solution Market 2014-2018
Diesel Gensets Market in India 2014-2018
Global Waterjet Machine Market 2014-2018
Global T&D Equipment Market 2014-2018
Global Circuit Breaker, Fuse, and Relay Market 2014-2018
Electrical Equipment Market in India 2014-2018
Global Traction Transformer Market 2014-2018
Global Cogeneration Equipment Market 2012-2016
Global Isolation and Safety Valve Market 2012-2016
Residential Portable Generator Market in the US 2012-2016
Global Portable Generator Market 2012-2016
Global Residential Generator Market 2012-2016
Diesel and Gas Generator Market in the US 2012-2016


50


2014-2018

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