OEMs optimistic about the market

Two out of three OEMs (original equipment manufacturers) believe revenue and profit will increase by 2020, according to a survey carried out by global management consulting company, McKinsey & Company.

The company reported its findings – which surveyed OEMs across Europe – at a conference held by CECE (European construction equipment manufacturers' association) at Bauma.

It found that 10% of OEM’s were strongly positive about their growth over the next four years, while 59% were slightly positive. Another 22% said they had neutral feelings, and 8% said they were slightly negative, while 1% said they were strongly negative.

In terms of revenue increases and EBIT (earnings before interest and taxes) margin improvements, 19% felt they would grow significantly, above 10% per annum, while 58% felt they would grow slightly, between 2 and 10% per annum.

The survey also found that most companies saw market trends as an opportunity, such as a shift of demand into markets outside of Europe, the increasing importance of aftermarket, and the higher demand for customised/specialised machines for specific applications.