Electric Motors Market

[310 Pages Report] The global electric motors market is expected to grow from an estimated USD 134.0 billion in 2022 to USD 186.0 billion by 2027, at a CAGR of 6.8% during the forecast period. Increasing demand for HVAC systems among residential, commercial, and industrial end-users, and growing demand for electric motors in manufacturing industries are the major driving factor for the electric motor market.

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Electric motors Market Dynamics

Driver: Rising demand for energy-efficient motors

Energy demand is expected to increase by 37% by 2035, with an average growth rate of 1.4% per annum. According to the US Department of Energy (DOE), in March 2020, electric motors were responsible for half of the energy usage in the US manufacturing sector. Electric and other motors used in industrial and infrastructure applications are responsible for 53% of the world’s total electricity consumption. Thus, several regulations have been implemented to ensure efficient and effective energy utilization. Currently, the International Electrotechnical Commission (IEC), a regulatory authority in Europe, has set energy efficiency norms. Most countries have started implementing such regulations to improve the energy efficiency of electric motors. IEC has developed a set of motor efficiency regulations, namely, IE1, IE2, IE3, and IE4, for reducing carbon emissions.

According to Control Engineering Europe (CEE), efficiency regulations for electric motors came into force in January 2017, requiring all AC motors with a rated output of 0.75–375 kW to operate efficiently. Over the years, energy-efficient electric motors using superior magnetic materials and displaying higher levels of tolerance have been developed. High-performance IE4 and IE5 motors offer immediate benefits to OEMs, as well as end-users. Electric motors generally require low maintenance and can produce high torque even at low speeds. Thus, the demand for electric motors has increased, especially in the power range of 0.75–375 kW.

In July 2021, the European Union implemented the Rules on Eco-design for Electric Motors and Variable Speed Drives. They are mandatory to be followed by all manufacturers and suppliers selling their products in the EU. The scope of this new regulation covers single-speed, 50 Hz, 60 Hz, or 50/60 Hz induction motors.

Restraint: Fluctuating prices of raw materials

The electric motor pricing is dependent on the price of raw materials such as permanent magnets, steel bars, copper wires, and precision thin metals such as specialty alloys. Many of these raw materials are sourced from China, Africa, and South American countries. In an electric motor market, the price of the product determines the dominance of certain suppliers. Any fluctuation in raw material prices will have a direct impact on the motor prices. Hence, the resulting price fluctuations have to be borne by the other manufacturers/suppliers in the market. Currently, neodymium magnet accounts for the largest share of the market and is expected to be the fastest-growing magnetic material segment during the forecast period. The high energy product and high residual flux density of neodymium make it a compulsive choice of material for industrial applications.

Currently, China supplies more than 95% of rare-earth oxides, thereby effectively dominating the market. similarly, china also has over 65% of hard ferrite and nearly half of aluminum nickel cobalt, and samarium cobalt of global production. The Chinese government has enforced export quotas and tariffs of up to 25% for these rare earth elements. Due to these factors, the price of raw materials in the global market is unstable and imposes a restraint on the global electric motor market.

Opportunities: Emerging robotics technology will increase demand for electric motors

The emerging robotics technology is likely to offer several opportunities for players in the electric motors market in the near future. Robots are extensively used in industries for simple repetitive tasks and also used in hazardous environments involving direct exposure to explosive chemicals and radioactive substances. This technology is used to perform specific tasks such as assembly-line work, space exploration, military services, warehouse delivery, surgical assistance, clearing mines, underwater exploration, duct cleaning, and commercialized agricultural activities. Electric motors such as brushless DC motors, AC motors, and stepping motors are used in portable and industrial robots to operate their wheels, tracks, legs, sensor turrets, or weapon systems. According to the International Federation of Robotics (IFR), 1.7 million new robots are expected to transform the world’s factories by the end of 2020. This will spur the demand for electric motors used in robotics.

Small and medium enterprises (SMEs) are playing a major role in the business world. About 90% of the businesses in the world are SMEs. Several manufacturing companies in the SME category have been concentrating on features such as quality, speed, and flexibility in industrial machinery. Digitalization allows industrial SMEs to implement effective processes to mass produce high-quality products at low costs. Industry 4.0 modifies the industrial processes of SMEs by integrating automation to improve the productivity of the companies. Technologies such as the Internet of Things, Big Data and analytics, additive manufacturing, and robotics are common trends. A survey by Automation, which is a subsidiary of the International Society of Automation has found that prices of robot technologies will be reduced by 76% by 2025 from that of 2010. This trend will eliminate the major barrier of cost for SMEs. The International Federation of Robotics has published a report on world robotics 2022, in which it stated that small and medium-sized enterprises (SMEs) have embraced automation in their infrastructure, which has enhanced the productivity and quality of SMEs.

Challenges: Shortage of components and supply chain issues leading to the higher product cost

The most significant near-term impact on electric motors that are already contracted or in the manufacturing process will be felt through supply chains. Industry executives are anticipating delivery and construction slowdowns, due to economic downturns, higher inflation, and unstable energy prices. Several components and parts for manufacturing electric motors come from China, the US, and a few parts of Europe. Manufacturing disruptions in China and the US could contribute to the stagnant growth in the electric motors market over the next one or two years.

Due to the inflation and economic crisis, the local currencies of several countries have depreciated. There is a misalignment of supply and demand, leading to financial losses for component/part manufacturers. Key components used in manufacturing electric motors are typically procured in US dollars, which results in increased component costs.

Market Trends

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DC electric motors segment, by type, is expected to grow at the highest CAGR during the forecast period

These DC motors have excellent starting torque capability with good speed regulation. They are used extensively in small DC motors and, to an increasing extent, in traction applications. A characteristic of series motors is that the motor develops a large amount of starting torque. However, speed varies widely between no load and full load. Series motors cannot be used where a constant speed is required under varying loads. They are best suited to traction applications, crane applications, small electrical appliances, mobile electric equipment, hoists, and winches. Shunt motors are used where constant speed is required, and starting conditions are not severe. They find application in lathe machines, centrifugal pumps, fans, blowers, conveyors, lifts, weaving machines, and spinning machines. The series field provides better starting torque, and the shunt field provides better speed regulation. Compound motors are used where higher starting torque and constant speed are required, for example, in presses, shears, conveyors, elevators, rolling mills, and heavy planners.

By output power, the < 1 HP motors segment is expected to be the largest during the forecast period

This report segments the electric motor market based on output power into two types: <1 hp motors (fractional horsepower) and >1 hp motors (integral horsepower). The <1 HP motors are used in a wide variety of industries and applications. The automotive sector is one of the major contributors of the revenue for these motors, where they are used in electric windows, powered seats, wing mirrors, central locking systems, and roof, and trunk openers. <1 hp motors are also used in upstream, midstream, and downstream applications in the oil & gas industry. In the upstream sector, they are used for pumping well and artificial lift systems. They are used for transportation and storage purposes in midstream applications and for refining crude oil in downstream applications. The <1 HP motors are also used in small appliances to drive pumps and compressors in pump motors, vertical thrust handling motors, and hazardous location motors.

“Asia Pacific: The largest and fastest electric motors market”

Asia Pacific is expected to dominate the electric motors market between 2022–2027, followed by Europe and North America. The government regulations and mandates about motor efficiency and rapid industrialization are the reasons for the region’s significant market size.

Key Market Players

The electric motor market is dominated by a few major players that have a wide regional presence. The major players in the electric motors market are ABB (Switzerland), Siemens (Germany), Wolong Electric (China), NIDEC Corporation (Japan), and WEG S.A (Brazil). Between 2018 and 2022, Strategies such as product launches, contracts, agreements, partnerships, collaborations, alliances, acquisitions, and expansions are followed by these companies to capture a larger share of the electric motor market.

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Scope of the Report

This research report categorizes the electric motors market by type, power rating, voltage, rotor type, output power, end user, and region

On the basis of by type, the market has been segmented as follows:

• AC motors
• DC motors

On the basis of end-user, the market has been segmented as follows:

• Industrial
• Commercial
• Residential
• Agriculture
• Transportation

On the basis of power rating, the market has been segmented as follows:

• <1 kW Motors
• 1–2.2 kW Motors
• 2.2–375 kW Motors
• >375 kW Motors

On the basis of voltage, the market has been segmented as follows:

• Low Voltage Motors
• Medium Voltage Motors
• High Voltage Motors

On the basis of rotor type, the market has been segmented as follows:

• Inner Rotor
• Outer Rotor

On the basis of output power, the market has been segmented as follows:

• <1 HP
• >1 HP

On the basis of region, the market has been segmented as follows:

• Asia Pacific
• Europe
• North America
• Middle East & Africa
• South America

Recent Developments

• In August 2022, ABB announced that it has signed an acquisition to purchase Siemen's low-voltage NEMA motor business. With manufacturing operations in Guadalajara, Mexico, this acquisition provides a well-regarded product portfolio, a longstanding North American customer base, and an experienced operations, sales, and management team.
• In July 2022, WEG launched the W12 electric motor, which is designed for use in high-performance industrial applications while offering versatility and efficiency
• In May 2021, Siemens and Schaeffler Group collaborated to provide intelligent diagnostics for drive and electric motor systems. The collaboration enabled Siemens to combine its IIoT platform Sidrive IQ with Schaeffler Group’s expertise in designing, manufacturing, and servicing bearings.
• In March 2020, Wolong Electric acquired GE's small industrial motors business for USD 160 million. This acquisition is expected to help Wolong gain a leading position in terms of market share.

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