According to a recent IHS report, the industrial Ethernet components market remains weak in 2015 and 2016, mainly due to the weak oil prices and instabilities in Europe. This situation is forecast to change in 2017 with growth estimated to pick up, but what do the Ethernet companies think about the forecast?
According to a recent IHS report,
the industrial Ethernet components market remains weak in 2015 and 2016, mainly due to the dip in oil prices and instabilities in Europe. This situation is forecast to change in 2017 with growth expected to pick up, but what do the Ethernet companies think about the estimation?
We talked to a few major Ethernet companies to understand how they saw the year and how they coped with the difficulties.
“There is no doubt that there have been some economic challenges,” said Eddie Lee, Director of Global Industry Marketing at
Moxa. “In this case, the growth for Moxa has slowed compared to previous years. It is important to note that we still grew, in 2015, and 2016, but it’s just that compared to the double digits growth that we have been accustomed to ever since 2009, the last few years have slowed. I would attribute, from a Moxa perspective, this to the crash of the oil prices.
For Moxa the oil and gas vertical is a key market and changes in it directly affects the company. Lee also pointed out that the vertical indirectly affects other markets, like traditional manufacturing and the economy as a whole.
Moxa refrained from giving the exact growth figures but indicated that it was by 2016 that growth had fallen to single digit. Other companies gave similar comments but were more willing to go into the details.
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EtherWAN had over 9 percent growth in 2015 and 4 percent growth in 2016 from the viewpoint of sales revenue,” said Alvin Hsu, Manager of Product Marketing Dept. at EtherWAN Systems. “There were sales revenue decline in Europe because of economic downturn of Russia and politics impact of pan-Europe.”
To cope with this pressure, the company launched more high-end products with broader margins in 2015, which helped them receive more orders in 2016.
EtherWAN is not the only company that decided to use the strength of new products to resist the market pressures.
CTC Union said that unlike a normal year where their sales growth rate would be up to 30 percent, the year 2016 only saw a growth of around 15 percent.
“We create new product lines, and also introduce various product solutions for difference market segment,” said Gary Tsai, PM Director of CTC Union. He attributed the weak growth to an overall market slowdown and lack of spending in government infrastructure.