East African Genset Market Poised for High Growth Due to the Power Crisis, Notes Frost & Sullivan

By Frost Sullivan, PRNE
Sunday, August 29, 2010

CAPE TOWN, South Africa, August 30, 2010 - The East African region is fraught with seasonal droughts and a
consequent power crisis. This crisis, coupled with an expected rise in
economic growth in the region, is the main driver for growth in the East
African genset market. The sectors that are experiencing significant growth
include, but are not limited to, telecommunications, manufacturing, mining,
commercial, and construction.

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New analysis from Frost & Sullivan (www.energy.frost.com), The
East African Genset Market, finds that the market earned revenues of US$54.4
in 2009 and estimates this to reach US$212 million in 2014. The
end-user sectors covered in this study include industrial and commercial,
mining and construction, telecommunications and agricultural.

If you are interested in more information on this study, please send an
e-mail to Patrick Cairns, Corporate Communications, at
patrick.cairns@frost.com, with your full name, company name, title, telephone
number, company e-mail address, company website, city, state and country.

"The water levels in the major dams feeding the hydro power stations in
the region have drastically decreased, stepping-up the need for gensets,"
says Frost & Sullivan Research Analyst Salima Zyambo. "Additionally, economic
growth ranging between 4 and 8 per cent is expected in the long-term as East
embarks on economic development programmes, further creating a demand
for gensets."

Infrastructure development, road construction and industrial expansions
have led to an increase in the use of gensets, both as a source of prime
power and stand-by power.

However, market growth is hampered by lack of quality control
regulations - a major growth restraint in the genset market for original
equipment manufacturers (OEMs). Furthermore, OEMs from Europe and North
are facing stiff competition from their Asian counterparts, who are
able to supply gensets of increasingly good quality at competitive prices.

"The market is flooded with gensets of varying quality and prices as a
direct result of the lack of quality control regulations in the region,"
explains Zyambo. "With the demand for gensets expected to rise as the
region's economy grows, more equipment suppliers are entering the market."

Product quality and efficient after-sales services are however fast
replacing product price as the key differentiating factors in the genset
market. Offering a wide variety of product brands to customers is another
critical success factor that will reduce the probability of customers
switching to other suppliers.

"Equipment suppliers who can ensure efficient service delivery, product
quality and cost competitiveness are in a better position to capture and grow
their market share," concludes Zyambo. "This can be achieved by either
opening more outlets or working in conjunction with existing equipment

The East African Genset Market is part of the Energy & Power Growth
Partnership Services programme, which also includes research in the following
markets: The Sub-Saharan Africa Large Diesel Generation Markets and Power
Rental in Key African Markets. All research services included in
subscriptions provide detailed market opportunities and industry trends that
have been evaluated following extensive interviews with market participants.

About Frost & Sullivan

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    The East African Genset Market

    Patrick Cairns
    Corporate Communications - Africa
    P: +27-18-464-2402
    E: patrick.cairns@frost.com


Patrick Cairns, Corporate Communications - Africa of Frost & Sullivan, +27-18-464-2402, patrick.cairns at frost.com

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