Home
Global Supplier Directory
APPLIANCE Engineer
Supplier Solutions
APPLIANCE Line
Whitepaper Library
Calendar of Events
Association Locator
Contents Pages
Market Research
Subscription Center


 
   
issue: January 2006 APPLIANCE Magazine

54th Annual Appliance Industry Forecasts
Significant Factors Will Define 2006


 Printable format
 Email this Article
 Search

by Joseph M. McGuire

In 2006, a number of industry-shaping dynamics will need the attention of AHAM members. In APPLIANCE's 2005 annual forecast, I cited the perennial factors that impact shipments of home appliances. These include external factors such as the strength of the U.S. and global economies, interest rates, consumer confidence, the weather, costs of materials, and energy.

Added to these are company-specific factors including innovation, productivity, globalization, and other supply chain issues. The combined effect of these factors resulted in a modest increase in factory shipments of major home appliances in 2005. AHAM's major appliance median industry forecast for 2006 forecasts a similar picture for the coming year. These numbers and many other appliance trend data can be viewed in AHAM's recently published Fact Book.

As the industry enters 2006 a number of broad factors, some already in place, will receive significant attention from AHAM members. First, the Barton-Domenici Energy Policy Act of 2005 will begin to influence the overall energy efficiency of major home appliance shipments. The law contains dozens of efficiency provisions including those related to appliance efficiency standards and the Energy Star program. Energy Star, administered by both the U.S. Department of Energy and the Environmental Protection Agency, will benefit from new rules to ensure greater transparency in its development. It will also benefit from the new manufacturer tax credit for super-efficient refrigerators, clothes washers and dishwashers, which will increase the market penetration of products meeting and exceeding Energy Star criteria.

The value of major appliance shipments in 2004 to the top five export countries-Canada, Mexico, Saudi Arabia, the United Kingdom, and Australia-exceeded U.S. $1 billion. Final data is not yet available from the Department of Commerce for 2005, but preliminary numbers show an almost 17-percent increase in the dollar value of exports compared to 2004 numbers. This growth presents new challenges to the U.S. industry to meet the changing demands and requirements of doing business in a global economy. In 2006, three issues will dominate in an effort to keep the top markets open.

First on the list is the need for manufacturers to ready themselves for the implementation of the European Union (EU) substance restriction ban. Compliance with the Restriction of Hazardous Substances (RoHS) Directive will be mandatory for all products in the EU market as of July 1, 2006. In December 2005, AHAM partnered with the Gas Appliance Manufacturers Association to offer members a 1-day comprehensive crash course on compliance with RoHS. It was evident from the turnout that manufacturers still have many questions on the details of implementation. So far, many of the rules are unclear and the details of testing, implementation and enforcement have yet to be made available. Despite the murkiness of the details, excellent coordination from industry suppliers has been seen by OEMs. According to a recent survey by Technology Forecaster, 48 percent of suppliers are 75 percent or more complete in removing hazardous substances from their products.

Manufacturers doing business in China and Japan should also begin to study the RoHS requirements in those countries as implementation dates do not lag far behind Europe. In the U.S. there are RoHS requirements in California for some consumer electronics taking effect in 2007.

The end of life issues will continue to dominate cross-pond dialogue well beyond 2006.

The EU, in addition to its Waste Electrical and Electronic Equipment (WEEE) and RoHS Directives, is now on to the Ecodesign for Energy Using Products (EuP) Framework Directive to ultimately establish product-specific environmental performance requirements for appliances and other consumer products. Stay tuned for more information on EuP and sustainability issues.

Canada is, of course, the largest export market for U.S. appliances. Our neighbor to the north is obviously important for this reason and because its regulatory approach often follows Europe and can be a harbinger for U.S. state activity. Ontario, Canada is still developing its WEEE program, which is somewhat similar to the EU model. Implementation is expected in late 2007 or early 2008. Ontario's Minister of Environment has named six products groups, including major, portable and floor care appliances, which will be subject to producer responsibility for end of life product recycling. To manage this obligation, an Industry Funding Organization (IFO), in which AHAM members are represented, was established by potential product stewards to design product take back programs. AHAM's members, working in concert with the IFO, will be integral in developing this program which will need to be approved by the Ontario government before it is implemented.

Finally, AHAM will increase its already healthy involvement in international standards development and harmonization. AHAM's role focuses on influencing the U.S. position to represent the interests of AHAM manufacturers. Specifically, this year, with AHAM's help, the North American requirements to Part 1 of the International Electrotechnical Commission (IEC) 60335 standard will be finalized, creating the first uniform general safety requirements for all appliances for North America. Also, AHAM will continue to advocate for harmonized performance test methods, using U.S. based performance standards, through IEC's Technical Committee 59. Work will continue throughout the year on IEC's clothes washer, floor care, cooking equipment, and dishwasher standards, as well as International Organization for Standardization's (ISO) refrigerator-freezer standard.

AHAM will update you on the progress of these issues throughout the year in Appliance. Or, you can check in with us, at www.aham.org.

As you probably surmise, AHAM forecasts another busy year.

 

Daily News

...........................................................

Oct 21, 2014: AHRI Annual Meeting Registration Remains Open

Oct 20, 2014: Electrolux 3Q Operating Income up 29%

Oct 17, 2014: Whirlpool completes purchase of majority interest in Indesit

Oct 17, 2014: Corrected: AHRI Annual Meeting Registration Remains Open

Oct 17, 2014: Walmart will moderate brick-and-mortar growth and increase capital spending on e-commerce capabilities

More Daily News>>

RSS Feeds
.........................................................
Appliance Industry
Market Research

...........................................................

September 2014: Appliance Industry Focus: HVAC
June 2014: Appliance Magazine Market Insight: April 2014
May 2014: Appliance Magazine Market Insight: March 2014
April 2014: Appliance Magazine Market Insight: February 2014




 
Contact Us | About Us | Subscriptions | Advertising | Home
UBM Canon © 2014  

Please visit these other UBM Canon sites

UBM Canon Corporate | Design News | Test & Measurement World | Packaging Digest | EDN | Qmed | Plastics Today | Powder Bulk Solids | Canon Trade Shows