The pump customers, markets and competitors keep changing so fast that top management of pump companies is challenged to stay abreast of the latest developments and then interpret them properly. One example of market change is the rise of third party operators of air pollution control systems in China.
The Chinese government has encouraged third party operation to insure that power plants meet their particulate, SO2, and other emission requirements. This means the rise of companies such as Boqi to buy replacement pumps and parts for sorbent handling, limestone scrubber liquor recycling, gypsum dewatering, zero liquid discharge systems, ammonia injection, and other air pollution control pump requirements.
Source: McIlvaine Company
This third party operation of scrubber systems is becoming commonplace in developing countries where Japanese and Chinese institutions are funding the construction of new power, chemical, and mining facilities. Third party operation of gas turbine combined cycle power plants is also becoming common. NAES, the U.S. subsidiary of Itochu operates hundreds of gas turbines and coal fired power plants.(1)
Third party operation has long been common in municipal water and wastewater plants. Suez operates half the wastewater plants in Chile and hundreds of plants in Europe, the U.S. and Asia. The acceleration of the third party operation trend presents multiple challenges to pump company strategists. One is to provide direct sales programs for these large purchasers. Another is to coordinate the personnel needed to address the activities in multiple countries in which the third party operator is active.
The markets are changing as rapidly as a mine can sink an oil tanker in the straits of Hormuz. The decisions of ExxonMobil and Chevron to divert billions of investment dollars to oil shale extraction in the U.S. will greatly alter the world pump markets.(2) Sinopec says it has the solutions for hydraulic fracturing of the tough shales in China. The impact of this development could be equally significant. China has greater shale reserves than the U.S. Also Sinopec has its own design of pumps which it uses for hydraulic fracturing. It supplies complete mobile fracturing plants. It is active in the U.S. and has initiatives in the Middle East. Sinopec is also the world’s largest purchaser and operator of pumps. It extracts oil and gas, operates refineries and petrochemical plants. It is an Engineering, Procurement and Construction (EPC) contractor and plant designer with activities in many countries.
Another challenge is to keep up with changes in the competitive situation. Mergers and acquisitions continue to reshape the market. Crane is trying to acquire CIRCOR. Ingersoll Rand and Gardner Denver are merging their pump operations. In addition to the mega mergers there are strategic acquisitions of smaller companies. The pump market consists of niches served by a variety of different designs, sizes, and materials of construction.
The impeller.net website provides a convenient way to stay abreast of the competitor developments with convenient searches entitled “acquisitions and mergers” and “financial news”. One learns that ITT has completed the acquisition of Rheinhütte Pumpen Group, the cited synergy is a complementary portfolio of pump technologies suited to corrosive, abrasive and high-temperature environments. The acquisition also bolsters ITT’s presence in Europe through enhanced pump engineering, manufacturing, testing and channel to market capabilities.
Dover explains that it purchased All-Flo because it is a growing manufacturer of specialty air-operated double-diaphragm (AODD) pumps used in a wide range of industrial applications to transfer viscous, abrasive and hazardous fluids, sludges and slurries. AxFlow Austria, part of the AxFlow Group acquired VIP Tehnika, because of expertise in sales and service of pumps for water and wastewater applications in Slovenia.
One of the added features to this acquisitions and mergers link is a hierarchy to related information. In the case of one merger of purchasers in the petrochemical sector there is a link to petrochemical pump articles. Sulzer is acquiring GTC Technology US, LLC, a technology company offering proprietary processes and systems for the production of aromatics and other petrochemicals. There is a link to relevant petrochemical pump articles including two on canned motor pumps which are widely used in petrochemical applications. One link is to the Lewa sales of Nikkiso pumps and the other is to pumps by Hermetic Pumpen.
In order to keep abreast of the prolific market developments the pump companies are well served by taking advantage of strategic and market services and also the use of well-organized news sources.
(1) Utility Tracking System published by the McIlvaine Company
(2) Pumps: World Markets published by the McIlvaine Company