Report: Building Construction, Renovation Drive North American Fire Suppression Systems Market
The North American fire suppression systems market continues to witness remarkable growth due to robust new construction and retrofit/renovation markets, according to Frost & Sullivan. Steady demand from end users as well as fresh interest for emerging applications sustained steady market growth for the period between 2003 and 2006.
"Both new building construction and retrofits of existing buildings have remained buoyant, mostly driven by code compliance, thus positively impacting revenue growth," said Frost & Sullivan Research Analyst Konkana Khaund. "Economic conditions are likely to favor an already upbeat construction market, further driving retrofits."
Analysis from Frost & Sullivan, "North American Fire Suppression Systems Market," finds the market generated revenues of $653.5 million in 2006, a growth of 10.4 percent over 2005. The market is expected to grow at a compound annual growth rate of 5.6 percent to reach $954.9 million in 2013. Capital investments are expected to result in an increase in fire suppression system replacements or retrofits as businesses opt for improvements.
Attention is shifting toward alternate fuels and fuel additives such as ethanol and alternate energy sources such as biodiesel and liquefied natural gas (LNG) due to the energy crisis and fluctuating fuel prices. Rise in alternative fuel and energy facilities represents considerable market opportunities for participating industry segments, particularly for the special type suppression systems.
Due to the war in Iraq, security concerns are on the rise for commercial and industrial facilities alike, particularly in the case of aviation facilities. These factors will certainly drive the participating market segments catering to these specific requirements.
Despite optimistic market conditions, there are challenges participants must overcome. Smaller and niche players find it difficult to maintain their positions because of increased price sensitivity in this maturing market. New participants face barriers to entry because several large companies dominate the market and also participate in acquisition and consolidation activities.
Moreover, existing participants who have difficulty meeting regulatory or statuary requirements are diversifying by introducing alternatives to traditional means of fire suppression, such as gelled halocarbon with dry chemical suspension, powdered aerosols and fluorinated ketone.