LONDON–(BUSINESS WIRE)–Technavio’s latest report on the fabricated metal market in Serbia provides an analysis on the most important trends expected to impact the market outlook from 2016-2020. Technavio defines an emerging trend as a factor that has the potential to significantly impact the market and contribute to its growth or decline.
Chandrakumar Badala Jaganathan, a lead analyst from Technavio, specializing in research on the metals and minerals sector, says, “The manufacturing sector is showing signs of rapid growth and is making a much larger contribution to the Serbian economy compared to the services sector. The fabricated metal products market in Serbia will grow at a steady rate, posting a CAGR of over 3% during the forecast period to reach USD1.7 billion by 2020. A wide variety of fabricated metal components such as hinges, locks, and rivets are expected to be in substantial demand. The demand for fabricated metal components used in the automotive sector is also likely to increase due to investments by foreign automobile manufacturers such as Fiat.”
The top three emerging trends driving the fabricated metal market in Serbia according to Technavio chemicals and materials research analysts are:
- Increase in M&A
- Focus on new export markets
- Rise in demand from Western Europe
Increase in M&A
Manufacturers are enhancing their existing product portfolios through M&A, and some international manufacturers are forging strategic alliances and partnerships with local manufacturers to tap into the growth potential of local markets. Large manufacturers are acquiring small and local manufacturers to consolidate their positions in the market. For instance, Esmark has envisaged interest in acquiring companies in Serbia, especially those that have fabrication facilities.
The government of Serbia is also inviting bids for loss making facilities as part of its divestment strategy, as well as to optimize the utilization of manufacturing capacities. This is expected to attract investments from global companies. Many manufacturers in Serbia are being acquired by European and North American companies to gain entry into the market and set up their manufacturing base.
Focus on new export markets
Manufacturers in the market are focusing on expanding into new export markets that are expected to grow at a rapid pace. For instance, export-oriented manufacturers in the market are assessing potential growth opportunities in developing countries in the Middle East, Africa and APAC. However, the dominance of low-cost products from countries such as China and India have limited the probability of success. Nevertheless, many manufacturers in Serbia employ advanced technologies and have acquired quality certifications which most small and medium-sized low-cost producers of fabricated metal products in Asia do not have. Such manufacturers are considering the probability of joint ventures in APAC to capitalize on new growth opportunities in these countries.
Rise in demand from Western Europe
The business environment in Europe is expected to become more positive in the future, as the European Central Bank has announced the implementation of a huge quantitative easing program worth USD 1.3 trillion by 2016. This will increase the circulation of currency in the economies in Europe, leading to higher spending by governments and industries for modernization of production facilities and related capital expenditure. The capital expenditure is likely to be earmarked for the building of new production facilities and expansion of existing production capacities, particularly by companies in Western Europe. This is expected to result in an increased demand for fabricated metals, which will provide potential growth opportunities for Serbian manufacturers that cater to the export markets in Western Europe.
The low cost of fabricated metal products manufactured in Serbia owing to factors such as proximity to countries in Western Europe and low logistic costs is a key competitive advantage. “Moreover, many companies in Western Europe are willing to invest in joint ventures with Serbian manufacturers to leverage the cost advantage. This will also provide an opportunity for local small and medium-sized manufacturers in Serbia to gain access to advanced manufacturing technologies,” says Chandrakumar.
Browse Related Reports:
Do you need a report on a market in a specific geographical cluster or country but can’t find what you’re looking for? Don’t worry, Technavio also takes client requests. Please contact enquiry@technavio.com with your requirements and our analysts will be happy to create a customized report just for you.
About Technavio
Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
If you are interested in more information, please contact our media team at media@technavio.com.
