On the verge of a new industrial revolution

On the verge of a new industrial revolution

We are ready to collect and store a huge quantity of information and digitalize complex processes.

1. How has 2016 been for Kaeser Kompressoren? Has the market met your expectations?

This year has been more challenging than 2015 because of the lack of investments. The few big projects that we targeted were delayed and others were shut down. It was the year of multiple crises and the economic one was the most ruthless. Therefore, we had to base our growth on multiple smaller projects, that implying, of course, a greater effort. We knew from the start that it would not be easy, but we were determined to reach our goals.

2. What are the main drivers on your market in 2016 and do you expect any significant changes in 2017? Please detail.

The food industry has been supplying us with an increasing number of projects and we believe that this trend will be maintained in 2017, as well. We don’t expect major changes to take place next year. Nevertheless, we hope that, in 2017, some of the postponed investments will materialize. We also have high hopes for the return of projects financed with European funds; unfortunately, in 2016, they lacked almost entirely. The automotive parts industry also continues to pleasantly surprise us, as some companies resume development projects which seemed to have been abandoned.

3. How would you describe the competition on the market?

Against the backdrop of the general economic situation and the reduced number of potential clients, competition is harsh. On the other hand, our line of business is very specialized and some of our competitors have diversified their offers and included complementary equipment which can be used for a wider range of applications. All in all, the competition is similar to the one in the other sectors of the economy.

4. What are the main challenges and opportunities on the Romanian market in 2016-2017? What are your biggest concerns about the national market?

Our growth depends very much on our clients’ investments in their production capacity. And there is still enough space for growth. There are industries in which almost no investments were made and in which investors haven’t shown any interest yet, but things are surely about to change in the near future. There are also companies which relocate or reduce their production capacities. Nevertheless, this does not necessary affect our group because we have branches all over the world.

5. As a global group, Kaeser Kompressoren is able to compare the Romanian market with those in Central and Eastern Europe. What are the main similarities and differences?

All Eastern European countries have similar economic evolutions. Kaeser Romania started its activity later and, in the beginning, we had a different dynamic. In time, these differences have faded, the procedures have aligned and we have comparable results regarding the market share. The only difference resides in the payment methods, as the cash flow is faster in neighboring countries.

6. At the local level, we have seen two main drivers for growth: the borrowing price from banks has reached a minimum low and taxes have been lowered. Have these tendencies helped the industry and your market? Please detail.

The influence of these drivers doesn’t seem to be too big, or perhaps other opposing factors are countering the potential benefits. Our partners are still complaining about the difficulties they encounter in accessing finance and about the numerous taxes. Some of the tax regulations adopted are hazardously applied to all operators, although they are subject to exemptions in other member states.

7. Please emphasize some of your strategies for growth in the following years. Does the concept of Industry 4.0 play a part in your strategy? Please define and detail.

We believe that more and more companies will outsource activities which are currently using valuable resources, and we are getting ready for that. We are focusing on our main activity, as supplier of compressed air equipment, and leaving the complementary activities to others. We are on the verge of a new industrial revolution, and Industry 4.0 or the Internet of Things are trends which we take very seriously. We have developed equipment and applications which allow us to be constantly connected to the compressed air systems we installed. This is surely what the future will be all about. Each partner who owns one of our central management system, SAM 4.0, will also have a virtual compressed air station on our servers, which will retain all the relevant information. This will help us step up from preventive maintenance to predictive maintenance. We are ready to collect and store a huge quantity of information and digitalize complex processes. Mr. Thomas Kaeser, CEO of Kaeser Group, often says that: ‘This company will have to turn digital or it will cease to exist’.

8. What is your forecast for growth in 2017?

Although Kaeser Romania is already a mature company, we will never stop aiming for improvement and growth. Our goal for 2017 is reaching a growth of at least 10%, provided that truly significant factors don’t stop us from achieving our target.