Elevator Demand in China to grow Nearly 11 Percent Annually

The market in China for elevator and escalator products and services is forecast to reach 111 billion yuan in 2013, expanding at an annual rate of 10.9 percent.  New construction and ongoing urbanization will support market gains.  An increasing installed base of elevators and escalators will provide opportunities for maintenance and repair services business, as the surge in product penetration of recent years is expected to continue through the forecast period.  These and other trends, including market share and product segmentation, are presented in Elevators in China, a new study from the Beijing office of The Freedonia Group, Inc., a Cleveland-based industry research firm.

Products will continue to record the majority of industry sales, accounting for 72 percent of the total elevator and escalator market in 2013.  This reflects the developing nature of the Chinese market.  In the mature US market, by contrast, product demand accounts for only about one-third of total sales.  The brisk pace of new construction activity in China -- itself fundamentally an outcome of the country’s rapid industrialization -- has made product sales the key driver of industry revenues. 

However, revenues generated from the provision of elevator- and escalator-related services will witness better growth prospects through 2013.  Market gains will be fostered by an expanding base of installed systems (which will offer favorable opportunities for maintenance and repair service business) and strong growth in new system sales (requiring installation services).  A larger installed base of elevators and escalators will also contribute to rapid acceleration of sales of associated products, the majority of which are purchased in the aftermarket.

China maintains a large trade surplus in elevator and escalator products though as recently as 2003 it was a net importer of these products.  The country has made tremendous progress in elevator and escalator manufacturing in recent years, as multinational producers have made investments in production facilities in China.  Exports totaled 9.7 billion yuan in 2008, accounting for 18 percent of industry shipments.  Common export destinations for Chinese elevator and escalator products include Southeast Asia, the Middle East and Eastern Europe.  Elevator and escalator imports, on the other hand, were comparatively small, totaling 2.5 billion yuan in 2008, or slightly more than five percent of domestic demand.

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.