Transcript Presentation for 9th ASIAN BATTERY CONFERENCE Bali
Presentation for 10
E
L
B
C Athens, Greece September 26-29, 2006
Global Market for Industrial Lead Acid Batteries
Current Status and Trends for the Future
Hollingsworth & Vose Company
Bob Cullen
Vice President, Sales & Marketing
List of Participants - Major Manufacturers
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C&D Technologies, Inc.
•
Douglas Battery Mfg. Company
•
East Penn Mfg. Co., Inc.
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EnerSys, Inc.
•
CSB
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Fiamm
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B.B. Battery
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Kung Long Battery
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Leoch
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Eurobat
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Exide Technologies
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GNB Industrial Power
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Exide India
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Panasonic (Worldwide)
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Power Sonic Corporation
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Power Battery Company, Inc.
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C&D China
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Yuasa/U.S., U.K., China, Taiwan
•
Amara Raja
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Battery Council International
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Crown Battery
Special Thanks to Key Industry Contacts “Special thanks for their contribution”
• • • • • • • • • •
Key Industry Contacts Mark Wilson - Ericsson, Inc.
Larry Lang - Cisco Karen Sansone - Nortel Steve McCluer - American Power Michael Keith - AT&T, Wireless Alan Katz - MGE Conversion Robert Parker - IBM/Internet John Wirtz - Wirtz Manufacturing Tucker Roe - Daramic, Inc.
Robert Wittemann- C&D
• • • • • • • • • • •
Battery Manufacturers Evan Wescoe - East Penn Ray Kubis - EnerSys, Inc.
Mr. J.C. Lee - KLB Keith Schmid- Exide Steve Vechy - EnerSys, Inc.
Tom Lynn - C&D Technologies Tom Minner- East Penn Jerry Hoffman- NorthStar Guy Clum - Power Sonic Hal Hawk – Crown Battery Company Alison Huang - CSB
Presentation Notes (Methodology & Conditions)
• •
Market projection covers period of 2006-2010
• • •
All figures reflect production within a given geographic area
•
U.S. dollars are used for consistency. Euro value of $1.20 was used to convert to $; 8. RMB = $.
Recent market price increases are not reflected .
Known export figures are identified.
Recent Chinese Government change in VAT refund policy not factored in.
Overview of Global Industrial Market
• • • • • •
2000 market size - $3.79 billion Overall market lost - $605 million in 2001 & 2002 Stationary market decreased by almost 30% driven by Telecom/UPS implosion Motive Power lost 7% due to a global recession Market began recovery in 2003 - 5% Strong Global Economies driving growth in 2004 & 2005.
2005 Global Industrial Battery Sales
By Market Class ($ billions) $2.712
Stationary
63% 37%
$1.592
Motive
Total: $4.304 Billion
Total Worldwide Industrial Battery Production 2004 vs. 2006 ($ billions) 4.8
4.6
4.4
4.2
4 3.8
3.6
3.4
3.2
3 2.8
$3.81
2004 $4.77
2006
Worldwide Battery Production, 2005 ($ millions)
$1,511
1600 1400 1200 1000 800 600 400
$1,306
200 0 N . A m er ic a 625 681 E ur op e 804 707
$922
72 850 C hi na R es t o f A si a
$180
33 147 Stationary
$199
31 168 In di a R es t o f Wo rl d
$186
27 159 Motive
Growth for Motive Power and Stationary Batteries, 2004-2006
Stationary 53% Motive Power 47% $957 Million Total
Motive Growth Rates by Region (%), 2006 - 2010 S. America Australia India Rest of Asia Taiwan 1 China Europe N. America 0 3 2 4 4 5 6 8 4 6 11 8 10 12
Stationary Growth Rates by Region (%), 2006 - 2010 -15 -10 -11 -5 S. America Australia India -5 Rest of Asia Taiwan China Japan Europe N. America 3 4 7 8 0 7 5 12 12 10 15
Euro vs. Dollar
1.40
1.30
1.20
1.10
1.00
0.90
0.80
1999 2000 2001 2002 2003 2004 2005 Euro 2006 Forecast $1.28 May 2006 2004 Forecast $1.18 May 2005
Source: Merrill Lynch Research
2005 China Industrial Battery Market- Exports
Millions of $
71% 29%
$260 Domestic $662 Export
Total: $ 922 million
Worldwide Motive Battery Production by Region, 2004 vs. 2006 2004 $1.46 billion 8% 1%1% 5% 2% 2% 45%
Europe
36%
N. America
N. America Rest of Asia Europe India 2006 $1.74 billion 3% 5% 2% 7% 2% 0% 2%
Europe
43% Japan Australia China S. America Taiwan
N. America
37%
Worldwide Stationary Battery Production by Region, 2004 vs. 2006 2004 $2.35 billion 4% 3% 5%
Taiwan India
2% 3% 20%
China Japan Europe N. America
28% 5% 30% 2006 $3.04 billion 6% 5%
India Rest of Asia
7%
ROW China N. America
25% 31% N. America Rest of Asia Europe India Japan Australia China S. America Taiwan
Europe
26%
Comparison of Stationary to Motive Battery Production by Region, 2006 (%) 1200 1000 ($ millions) 800 600 400 200 0 N . A m er ic a 53% 47% 46% 54% E ur op e 92% C hi na /A si a Stationary In di a R es t o f Wo rl d Motive 8% 84% 16% 88% 12%
Stationary vs. Motive Power, 2006 vs. 2010 ($ billions) 4 3.5
3 2.5
2 1.5
1 0.5
0 $1.74
$3.05
$2.05
$3.60
2006 Motive Stationary 2010
Stationary and Motive Trends, 2001 - 2010 4000 ($ millions) 3000 2000 1000 0 19 99 20 00 Motive Stationary 20 01 20 02 20 03 20 04 20 05 20 06 20 10
Global GDP’s 9.00% 7.00% 5.00% 3.00% 1.00% -1.00% 2001 Japan Latin America China 2004 2005 Euro Area Emerging Europe World US Emerging E. Asia
GDP: % change 2001 vs. 2005 (est)
• • • • • • •
United States Euro area Japan Emerging East Asia China Latin America Emerging Europe
•
World 2001 0.5
1.5
0.4
-0.4
7.3
2.0
4.3
2.7
2005 3.8
0.7
2.7
6.3
9.5
3.8
4.5
4.6
Source: CIA Factbook; Various Economic Websites
2005 Worldwide Sales of Motive Power
Batteries by Application ($ millions)
Industrial Truck $1,512 95% Mining Vehicles $26 1.2% Railroad/Locomotives $54 3.8% Total: $1.592 Billion
Global Motive Power Drivers
•
Forklift Trucks account for 95% of total
•
Very healthy worldwide economies reflect strong motive power production
•
Lead Price increases have driven some of this growth.
•
Europe – largest producer of motive power batteries – has higher percentage of electric vs. gas trucks than in N. America
Global Stationary Power Market Segments
2003 • • • • • • • • Telecommunications UPS Misc. Standby Security Control & Switchgear Emergency Lighting Electronics Medical
Total
41% 36% 4% 5% 6% 3% 2% 1%
100%
2004 2005 2006 40% 41% 42% 37% 36% 36% 4% 4% 7% 4% 4% 5% 7% 5% 4% 4% 6% 4% 3% 2% 3% 2% 2% 2%
100% 100% 100%
Worldwide Production of >25 Ah Batteries by Region, 2006 1% 3% 4% 3% 5%
S. America
41%
N. America China
18%
Japan Europe
6% 19%
$1.817 Billion
Worldwide Production of <25 Ah Batteries by Region, 2006 6% 11%
Taiwan
7% 1% 4% 3% 1% 8%
China
58%
$895 Million
Stationary Battery Sales by Size by Region, 2006 ($ millions) 1200 $1,035 1000 >25 Ah $767 14 $769 22 800 787 600 753 400 200 0 N . A m er ic a E ur op e 747 $220 36 Ja pa n $68 0 68 C hi na 248 184 In di a R es t o f Wo rl d $220 31 189 <25 Ah
Stationary Power Trends
• Telecommunications Market • Recovery from a steep decline began in 2003 • Consolidation is the trend in North America • Expanding beyond traditional markets in order to ward off new competitors.
• Wireless continue spending to build out networks
Stationary Power Trends Has the Telecom Market returned?
• 2003 recovery began - 5% • Long term outlook improves .
• Teleco’s have more choices: Lithium, Fuel Cells & Chinese Battery Manufacturers.
Global Infrastructure Expenditures (in billions) 300 250 200 150 $136 $155 $182 $260 $209 $185 $195 $214 $244 $269 $288 100 50 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Tech Spending Slips Worldwide Hardware Sales
2000 2001 2002 2003 1 2004 2005 2006 $0 $200 $400 $600
Sale s (in Billions )
$771 $679 $655 $684 $720 $760 $805
$800 $1,000
Source: Gartner
Stationary Power Trends
Telecom Market will be driven by
• Wireless • Internet • Traditional Telecoms offering broadband and digital TV to stay competitive.
Stationary Power Trends Wireless Market • Killer Application?
Data and Entertainment - Games • 50% of voice minutes worldwide - wireless • $1 trillion by 2005 & Growing 25% of Internet access will be via wireless.
Internet
• • •
Online purchases amount to over $500 billion in 2003 Projected to reach $864 million by 2006 Projected to grow at over 15% per year until 2010.
Internet Innovations
Web Computing Growth of software rental market, including software licenses and services 70 60 50 $ Billions 40 30 20 10 0 1999 2000 2001 2002 2003 2005 2007
3G is Growing! 4G is next
3G Applications
•
Internet mobile game users expected to explode over the next 5 years from 32 million today, to 220 million users by 2009
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3G will create $8 billion market that did not exist 18 months ago
•
VC’s are flocking to mobile game startups
Global Stationary Power Trends
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Telecommunications
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Recovering from spending binge of the 90’s Getting back to basics - reducing debt
profitability
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3G beginning to fulfill initial promises
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Telco’s being forced to compete with Cable
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Global partnerships/acquisitions will continue
•
Opportunities will be on global scale
Global Stationary Power Trends
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Telecommunications
•
Infrastructure
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Network holes in wireless infrastructure must be filled
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Asia/Pac Rim continues to be growth area
UPS Market
• Data Storage Centers – US Industry has insatiable need for instant data.
– Move away from complete centralization of data to having multiple back up.
• Spending on Data Centers increasing - Global equipment spending to hit $10.1 Billion by 2009, and continue at a 6.8% growth • Projected growth of 5-7% in US – small and mid size batteries being manufactured in Asia(12-15% growth rate).
Leading UPS Suppliers to North America
• Annual Battery Purchases – – – APC $255 million Powerware $ 153 million MGE $ 90 million – – – – – Lieberts $ 40 million Phoenixtec $ 42 million Mitsubishi Elec $ 12 million Toshiba $ 17 million Triplight $ 27 million
Summary
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Global Stationary Market began to recover in 2003- becoming Robust in 04 & 05.
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Telecom consolidations/joint ventures on 3G/4G will be in fashion over next several years
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Wireless infrastructure far from complete
•
Global Motive Power Market:
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Will show steady growth of 5% + annually
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Europe will continue as largest producer
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Overall Industrial Lead Battery Market will grow to a $5.6 billion market by 2010.
Presentation for 10
E
L
B
C Athens, Greece September 26-29, 2006
Global Market for Industrial Lead Acid Batteries
Current Status and Trends for the Future
Hollingsworth & Vose Company
Bob Cullen
Vice President, Sales & Marketing