World demand for major household white goods is projected to increase 3.9 percent annually through 2007, reaching 367 million units, according to "World Major Household Appliances," a study recently released from The Freedonia Group, Inc., a Cleveland, OH, U.S.-based industrial market research firm.
Gains will exceed the 1997-2002 pace because of accelerating global economic growth, which will stimulate consumer-spending activity, the report states. Demand in the Asia/Pacific region, in particular China, will continue to benefit from above-average urban population growth and healthy gains in the number of households. Latin America will also provide strong opportunities for appliance suppliers, the report reveals.
Above-average growth is also expected occur in the Africa/Mideast region due to strong gains in the number of households and rising incomes, according to the report.
Growth is also expected in the developed nations, despite the relatively high rates of market penetration. Advances in these regions will primarily be supported by replacement demand, as users both replace broken equipment and trade up to newer models.
Since the life cycle of most white goods is throughout a 10-year period, manufacturers will continue to introduce new technological innovations as a way to encourage upgrades. Among innovations that will boost demand are intelligent appliances that can perform such functions as reading labels and connecting with other household goods.
China has grown into the world's largest supplier of white goods, nearly tripling production from 1992 to 2002. The nation has taken advantage not only of its inexpensive labor pool, according to the report, but also of favorable exchange rates, which have made pricing of Chinese goods especially competitive.
The report also says that China has become a leading producer in the refrigerator and microwave oven segments, where private label products are exported to the U.S,. Western Europe, and throughout Asia. However, as consumer acceptance of Chinese products rises, manufacturers are expected to increasingly market internationally under their own brand names. Other major exporters of white goods include Italy and South Korea.
Microwave ovens are expected to exhibit the best gains through 2007 due to significant untapped market potential in numerous countries, especially in the developing regions. Dishwashers will exhibit above-average growth as well, although price, size and cultural considerations will prevent these items from becoming commonplace in most areas where they are not already established, the report states.
to Daily News