Process Control Instrument 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 740 process control instrument manufacturers in the US produce instruments and devices for measuring, displaying, recording, transmitting, and controlling industrial process variables such as temperature, pressure, flow, viscosity, and concentration. Customers are wide ranging but include manufacturers, distributors, utilities, natural resource extractors, military, and equipment repair services.

Dependence on International Trade

US process control instrument manufacturers are highly dependent on sales to foreign manufacturing markets, which exposes them to foreign currency exchange risks and trade tensions between countries.

Product Obsolescence

The industry rapidly introduces new and improved process control instruments and related technology and services that render older products less effective or obsolete.

Industry size & Structure

A typical process control instrument manufacturer operates out of a single location, employs fewer than 20 workers, and generates about $15 million annually.

    • The process control instrument manufacturing industry consists of about 740 companies which employ about 59,200 workers and generate about $11 billion annually.
    • Customer industries include manufacturers, distributors, utilities, natural resource extractors, military, and equipment repair services.
    • The industry is concentrated with the 20 largest firms representing 59% of industry revenue.
    • Large companies include Emerson, Hayward, Parker Hannifin, and Furness Controls.
                                    Industry Forecast
                                    Process Control Instrument Manufacturers Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Recent Developments

                                    Mar 3, 2023 - Reshoring Activity Remains Strong
                                    • Third quarter 2022 reshoring and foreign direct investments (FDI) reached record levels, according to The Reshoring Initiative. Process control instrument manufacturers are likely to benefit from the reshoring of manufacturing activity. FDI was 15% higher than the second quarter — the previous high watermark — with a strong fourth quarter looking to result in a total of more than 350,000 jobs reshored for all of 2022. The Reshoring Initiative's 2022 projection of jobs would mark a nearly 40% improvement over 2021’s total of 255,000. The total number of job reshorings announced since 2010 would top 1.6 million.
                                    • Global oil companies have rebounded since the pandemic to post their highest ever profits. Process control instrument manufacturers serving the industry are likely to benefit from strong oil demand. Chevron, ConocoPhillips, Exxon, and Shell saw $1 trillion in sales in 2022 — a sum greater than the total economic output of Colombia, South Africa, or Switzerland. Experts cite the post-pandemic economic recovery combined with Russia's war on Ukraine as the key drivers of oil's resurgence.
                                    • More European firms are announcing plans to shift manufacturing to the US. Recent announcements include Luxembourg-based steel maker ArcelorMittal, which is slashing production at two German plants following a better-than-expected performance at its Texas facility; Amsterdam-based chemical company OCI, which has announced plans to invest in its ammonia plant in Texas; and Volkswagen, and Danish jeweler Pandora, which are planning US expansions. American firms considering manufacturing facilities in Europe are reconsidering. Tesla paused plans to make its battery cells in Germany while its executives study tax credits offered by the Biden administration's Inflation Reduction Act. “European manufacturers, like all manufacturers, are seeking to mitigate risk in an environment that is currently facing an unusually high level of uncertainty,” says Steve Kozarits of real estate services firm Transwestern. Risk is currently tied to many factors, including political instability, labor shortages, and availability and cost of energy. Companies in Europe that are shifting operations to the US are being attracted by more stable energy prices and muscular government support. Europe could face high prices, at least for gas, well into 2024, according to some economists. Natural-gas producers including Canada, the US, and Qatar may struggle to fully replace Russia as a supplier for Europe in the medium term. The US federal government has created many incentives for manufacturing and green energy, resulting in a playing field increasingly tilted in the US’s favor, executives say. The incentives are particularly enticing for companies placing bets on projects to make chemicals, batteries, and other energy-intensive products.
                                    • Process control instrument manufacturers may be negatively impacted by restrictions imposed by the US government on exports to Russia of equipment for Arctic, deepwater, and shale oil and gas exploration and production. Restrictions have also been placed on exports of oil refining equipment. Export of onshore and conventional shallow-water drilling gear are still allowed. Experts say that the US likely has held off on barring those items to limit collateral impact on the European Union, which is more dependent than the US on Russian oil and gas imports.
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