Compressor Market Overview
Global compressor market was valued at $36.6 billion in 2017 and is expected to reach $45.7 billion by 2023, exhibiting a CAGR of 3.5% during the forecast period. The major factor driving the market of compressors is growing motor vehicle demand globally, with Asia-Pacific contributing majority share in 2017, followed by North America, Europe, MEA, and LATAM. Apart from this, increasing replacement of piston compressors with screw compressor is propelling the market growth.
Based on compressor type, the compressor market is segmented into positive displacement and dynamic compressors. Positive displacement category held larger share in 2017, with APAC contributing nearly 50% share in terms of value. Within APAC, India is expected to be the fastest growing country in the positive displacement category during 2018-2023.
The positive displacement category is further classified into reciprocating and rotary compressors. Rotary compressor category contributed majority of the market share in 2017, and is expected to continue holding the larger share through 2023. Rotary compressors are used in most of the industries including oil and gas, chemical and cement, power, automotive, healthcare, food and beverage, textile, semiconductor and electronics, and industrial manufacturing.
The dynamic compressors are further segmented into centrifugal and axial compressors. Axial compressors are not very common in industrial applications, as they are rarely used for gas compression applications including blast furnace air, fluid catalytic cracking air and propane dehydrogenation. Centrifugal compressors are largely deployed in oil and gas industry for compression of gases.
Among lubrication type, oil-flooded compressors recorded a higher market share in 2017. Due to higher penetration of these compressors, oil-flooded compressors generated higher revenue as compared to oil-free compressors in the compressor market. Although, being expensive and heavier than oil-free compressors, oil-flooded compressors are much quieter in operation as well as have a longer lifespan, making them popular among large scale and heavy industries.
In terms of portability, the market is split into portable and stationary, of which, stationary compressors accounted for larger revenue share of over 90% in 2017, and are expected continue at a higher CAGR during 2018-2023. Stationary compressors are significantly more powerful as compared to portable compressors, making them adapt for industrial manufacturing as well as oil and gas industries.
APAC held highest share in the compressor market in 2017. This is attributed to growing demand for motor vehicles and corresponding production of vehicles. In APAC, motor vehicle production in 2017 stood at $45.9 million units, followed by North America with 26 million units, and Europe with 18 million units. Among countries, India is expected to record fastest CAGR during the forecast period, owing to infrastructure development and growing construction industry in the country.
Compressor Market Dynamics
Gas or steam turbines have always been the default choice for mechanical prime movers, especially in large compressors. However, use of variable frequency drive (VFD) is gaining significant traction around the globe owing to its advantages such as reduced downtime, accurate speed control and reduced noise, among others. Manufacturers are continuously striving to simplify the usability process as well as reduce the maintenance downtime, in order to make VFDs more widely accessible to a range of industrial end-users, which in turn is leading to rising adoption of VFD.
Heating, ventilating and air conditioning equipment (HVAC) have been registering a steadily growing demand since past two decades. The global AC demand stood at 110 million units in 2017 as compared to 100 million units in 2013. HVAC market is likely to register stable growth in future owing to increasing construction activities, development of energy efficient systems, as well as growing smart homes market. Since, compressor is one of the major utilities in air conditioning systems, the rising application of the same is expected to drive the compressor market growth globally.
The equipment, installation, maintenance, and electricity cost associated with compressors installed in residential as well as commercial purposes is huge, making it one of the major restraints in a price-sensitive market. Consumers opt to service and continue usage of existing compressors as opposed to investing in new installation, in order to reduce capital expenditure, since the upfront cost of compressor is significantly higher. Owing to various factors such as infrastructure management, piping optimization, handling air leaks, large repairs, changing filters on regular basis, and colossal electricity bills, the compressor market growth is witnessing hinderance globally.
Growing demand for eco-friendly compressors expected to create huge growth opportunities across the globe. The market is registering growth in demand for oil-free compressors, since they have the potential to improve a facility’s air quality, owing to the fact that they do not utilize oil to operate. An oil-free compressor eliminates the risk of delays and product contamination. Moreover, strict quality standards, especially in South Korea and Japan are projected to create market opportunities for eco-friendly compressors.
Compressor Market - Competitive Landscape
Companies such as Gardner Denver Holdings Inc., and Atlas Copco AB were involved in mergers and acquisitions to expand their presence in developing regions such as Asia and Africa. While, Kaeser Kompressoren SE, and Atlas Copco AB were majorly active in product launches to enhance their product portfolio. Some of the major players in the global compressor market includes Gardner Denver Inc., Ingersoll-Rand PLC, Kaeser Compressors Inc., Ingersoll-Rand plc, Mitsubishi Heavy Industries Ltd, Atlas Copco AB, Kobe Steel, Ltd., ANEST IWATA Corporation, Zhe Jiang Hongwuhuan Machinery Co., Ltd, MAHLE GmbH, Sanden Holdings Corporation, Valeo SA, Hanson Systems, Toyota Industries Corporation.