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Danfoss disputes ABB`s HVAC claims

01 August, 2005

Danfoss disputes ABB`s HVAC claims

Danfoss Motion Controls is challenging ABB`s claim to have taken the lead in the UK market for HVAC drives. According to Danfoss, it still holds 35% share of the £11m UK HVAC drives market - about twice as much as ABB, which it puts at 18%.

According to Danfoss` analysis, Vacon has about 13.5% of the UK market (through Trend), and Siemens about 9%. Control Techniques, SSD and Telemecanique each account for about 4.5% of the market. However, Danfoss admits that is difficult to substantiate these figures without accurate figures for its competitors` turnover.

The UK HVAC market tends to demand higher-specification drives than the industrial sector, with RFI and harmonic filters and HVAC-specific sioftware. Also, 95% of all HVAC drives have IP54 protection. Danfoss suggests that is one reason that there has been less competition in nthis sector from US and Asian drives suppliers.

Danfoss reports that the UK HVAC market is "gaining momentum" and is growing at 6-10% a year. But it adds that margins have deteriorated sharply because a previous market slump and increased competition, especially from ABB with its "aggressive pricing strategy".

According to Danfoss` analysis, if margins are to improve "it will be a slow, painful process," but it believes that its new AutomationDrive product could help it in this area.

Danfoss is cutting its repair costs by up to half in an attempt to persuade its customers to stop using unauthorised repair shops. Instead of levying a fixed charge for repairs based on a drive`s rating, authorised repairs will now be carried out on a parts and labour basis which, Danfoss says, will favour the customer. It warns that using "grey market" repair shops is a false economy, because these repairers cannot source genuine components and often fit parts salvaged from damaged products.

According to Danfoss, this means that "frequently, the repair work, although ostensibly carrying a so-called guarantee, is ultimately unreliable and prone to early failure. There is no real guarantee of uninterrupted prooduction, only a promise of a free repair if the failure occurs within the repair guarantee period. This, in turn, can reflect badly on the original manufacturer of the equipment, through no fault of its own."

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