Electrical Equipment Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 1,600 electrical equipment manufacturers in the US produce goods that generate, control and distribute power. The industry manufactures a wide range from products including light fixture components; electric motors, generators, and components; power substation transformers; electrical panels and components for buildings; and electrical controls used in machinery.
Reliance on Construction Spending
Electrical equipment manufacturers’ sales are affected by the health of the construction sector.
Electric Grid Modernization
The need to modernize and expand electric grids is a positive for electrical equipment manufacturers.
Industry size & Structure
A typical electrical equipment manufacturer employs 90 workers and generates about $27 million annually.
- The electrical equipment manufacturing industry consists of about 1,600 companies which employ about 147,000 workers and generate about $44 billion annually.
- Most companies are small, independent operators - about 84% have a single location.
- The industry is concentrated: the 20 largest firms represent 53% of industry revenue.
- Customer industries include electric power generators and distributors, lighting equipment manufacturers, industrial machinery manufacturers, motor manufacturers and repair services, electrical component wholesalers and retailers, and electrical contractors.
- Large companies include General Electric, Honeywell, Schneider Electric, Emerson, and Eaton.
Industry Forecast
Electrical Equipment Manufacturers Industry Growth
Recent Developments
Jan 27, 2025 - Rising Electricity Demand Draws Interest of Oil, Gas Firms
- Some oil and gas majors are considering entering the electricity generation market amid the rapid uptick in energy demand by the data centers used to power AI, according to The Wall Street Journal. Chevron and Exxon Mobil are both in conversations with data center operators about providing natural gas-fired power generation with carbon capture. Large oil and gas companies have experience building gas-fired plants to support their various operating activities, including refining, petrochemical production, and natural gas liquefaction. Oil and gas majors may also have more recent plant construction experience than independent power producers, some of which have not built a new plant since the early 2000s. Oil firms can also site plants near their own fuel production sites and power data centers without needing to connect to the grid.
- In mid-January, then-President Biden signed an executive order to help speed up data center development to power AI and the clean-energy electricity generation needed to power the data centers, according to Utility Dive. The order directs the US Departments of Defense and Energy to locate lease sites on federal lands for private-sector development of gigawatt-scale data centers and clean electricity generation plants to power them. After the site selection process is complete, the DOD and the DOE will open competitive bidding for leases for private construction, operation, and ownership of AI infrastructure. Project owners will be required to use clean energy for all their electricity needs. The order also calls for expedited project permitting to speed development.
- After posting solid gains in 2023 and 2024, construction spending for nonresidential buildings is expected to slow significantly in 2025 and 2026, according to the American Institute of Architects’ (AIA) Consensus Construction Forecast released in January. Total spending for nonresidential building construction increased by 20% in 2023 and another 6% in 2024 but is forecast to slip to 2.2% in 2025 and 2.6% in 2026. For the next two years, growth will be led by data centers, which should support modest office construction in an otherwise challenging market. The warehouse sector is oversupplied, which will limit spending growth. Spending on institutional projects should remain stable as they are less susceptible to cyclical factors. AIA Chief Economist Kermit Baker said, “The modest outlook is partly based on a few expected headwinds to building activity, including potential tariffs on imports. There is also policy concern around how the construction labor force might be impacted by emerging immigration policy. Construction sector spending has been exceedingly strong – albeit unusually unbalanced – and coupled with these headwinds the projections are only very modest gains the next two years.”
- Home builder confidence in the single-family market moved higher in January 2025 amid hopes of improved economic growth and regulatory reforms, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), ticked up one point to 47 in January from 46 the previous month. Any HMI reading over 50 indicates that more builders see conditions as good than poor. While builders are still concerned about high interest rates and elevated land and financing costs, they are also hopeful that policymakers are aware of the industry’s headwinds and will move to reduce regulations.
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