Market to Watch: APAC remains a strong manufacturing hub for turbine OEMs with record high supply side deliveries
Europe is considered the cradle for modern wind turbine technologies, which explains why European OEMs such as Vestas and Siemens Gamesa Renewable Energy are today’s global leaders in wind turbine manufacturing and turbine technology innovation. Although most Asian suppliers have historically relied on turbine technologies licensed from Europe to enter the wind industry, Asia Pacific has now become the world’s largest wind turbine manufacturing hub after a decade of development. In 2019, GWEC saw eight Asian turbine suppliers making the cut in the world’s top fifteen supplier ranking, as per GWEC Market Intelligence’s latest report ‘Supply Side Data 2019’.
APAC number one region for total number of turbine suppliers
In 2019, some 33 wind turbine manufacturers installed an estimated 22,893 wind turbines globally with a combined capacity of 63,076 MW. Of the 33 suppliers, 20 are from APAC. As home to the world’s largest wind turbine manufacturing base, Asia Pacific saw 12,784 wind turbines installed during 2019, 55.8% of the global total for the year.
The top fifteen wind turbine manufacturers in 2019 includes the eight APAC companies, all of which are based in China. However, aside from Goldwind, Envision and Dongfang, none of these companies exported turbines to overseas markets last year. Suppliers such as Mingyang, Windey, Sewind, CSIC Haizhuang and United Power currently rely on their home market growth in China, the world’s largest wind power market, to secure a position on the top fifteen ranking. Looking beyond the top fifteen, Hitachi and Toshiba (Japan), Unison (Korea), Suzlon and Inox (India) are among the other Asia suppliers that reported turbine installations in 2019.
Current market consolidation is not in favour of tier 2 and 3 turbine suppliers in APAC
The Supply Side Analysis 2019 report shows the consolidation of the wind industry has continued, with the number of OEMs declining from 37 in 2018 to 33 in 2019 – these four suppliers that did not report installations in 2019 are all from the APAC region.
The top six turbine vendors collectively increased their global market share by another 3% last year. GWEC supply side historical data shows that Tier 1 wind turbine OEMs began their market dominance from 2015, and the three major M&A cases – GE-Alstom Power (2015), Nordex-Acciona (2016) and Siemens-Gamesa (2016) – impacted significantly the competitive landscape of the turbine manufacturing sector.
What does this mean for wind turbine OEMs?
GWEC’s Global Wind Report 2019, it is found that annual wind capacity additions can exceed 100 GW/year over the next decade, and this needs to rise to 200 GW annually post-2030 and beyond. This is in alignment with IPCC stipulations for a 1.5-degree pathway, and paired with wide-scale electrification and decarbonisation measures across economic sectors for system-wide transformation.
Within this competitive landscape, current trends favour companies that shift from being solely manufacturers to evolving into holistic systems and solution providers in order to accelerate, improve and expand their business. Therefore, GWEC Market Intelligence believes that more tier 2 and 3 turbine OEMs based in APAC are likely to be squeezed out of the market moving forward. This in turn raises the importance of scaling up manufacturing facilities by tier one suppliers in order to prepare well in advance for the huge market rise in the next few decades.
The Supply Side Data 2019 report is exclusively available for GWEC members as part of GWEC’s Market Intelligence platform. The report provides a detailed account of wind turbines installed globally from all active suppliers over the past year with breakdowns by both technology and region.
The final report that includes more than 30 tables and figures charting the evolution of global wind power markets on the supply side is the sister report of GWEC’s Global Wind Report 2019 that covers the global wind market status and outlook from the demand side. Combining the two reports provides a powerful tool for our members to understand the global wind market development from both the demand and supply side.
If you are a GWEC Member, access the report here.
Not a GWEC Member but interested in finding out more about the report? Get in touch with Raveen Singh at [email protected] to find out how.