Purification Systems And Automotive OEMs To Help Drive 3M's Industrial Segment

May 29 2014, 7:48am CDT | by

3M generates a third of its revenues from its Industrial segment. The segment offers products that cater to automotive original equipment manufacturers and the automotive aftermarket (auto body shops and retail) as well as the electronics, appliance, paper and printing, packaging, food and beverage, and construction markets. Its product portfolio consists of various tapes, adhesives, sealants, ceramics, filtration and purification products, and products used for the manufacture, repair and maintenance of automobiles, aircrafts and other specialty vehicles.

Lately, sales of 3M’s water filtration and automotive OEM products have been growing at double digit rates. Driven by the sales of these products, 3M’s Industrial segment’s revenue grew 3.1% in the first quarter of 2014. In this article, we take a look at the factors driving sales of these products and their outlook going forward.

See our complete analysis of 3M here

Growing Awareness And Adoption Of Purification Products In Developing Countries

3M’s purification business offers air and water filtration products for residential, commercial and industrial use. The use of water filtration products has historically been much higher in developed countries such as the U.S. and the U.K. due to greater consumer emphasis on filtration. Additionally, the higher disposable income in these countries makes the purchase of filters more viable for much of the population.

Lately, awareness about water related health concerns has been growing in developing countries leading to an increase in demand for filtration products. Also, with the emergence of a strong middle class, disposable income in developing countries has been increasing. This allows the population to consider spending on improving their living standards, thereby driving sales for filtration and healthcare products.

The global market for water purification equipment is expected to grow 10% annually though 2018. Most of the growth will come from Asian markets, particularly India and China. In India, the water purification equipment market is expected to grow 24% annually through 2018. Growth is expected to be slower in developed countries such as the U.S., which is expected to grow at around 6% per year.
/>

3M may continue to benefit from this growth by leveraging its vast international presence. Additionally, 3M’s filters may be given preference over others due to its certification by the Water Quality Association, a trade association representing the water treatment industry in the U.S. This adds to the credibility of 3M’s products and assures consumers of effective water purification.

Booming U.S. Automotive Industry Helps Drive Sales For Automotive OEM Products

In 2009, North American light vehicle production fell to 8.6 million units due to the global economic slowdown. However, due to a gradual economic recovery, the U.S. automotive industry is back on a growth path with 15.5 million light vehicles produced in 2013. Additionally, the average vehicle age has been at a record high, driving the need for servicing and maintenance. These trends have been driving growth in sales of 3M’s automotive OEM products. North American light vehicle production is expected to grow at a rate of 4% in 2014 driven by increase in consumer spending and high average vehicular age. Continued growth in vehicle production will help sustain 3M’s automotive OEM sales.

3M expects its industrial segment to grow 3%-6% in 2014. We believe this growth will be aided by the continued strengthening of the global economy and growth in end markets such as chemicals, industrials, construction and packaging.

See More at Trefis | View Interactive Institutional Research (Powered by Trefis) | Get Trefis Technology

Like our charts? Embed them in your own posts using the Trefis WordPress Plugin.

 
 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

IPad Air Giveaway 2014 is Online
IPad Air Giveaway 2014 is Online
Our sister site I4U News is giving away a brand new iPad Air or if you can wait an iPad Air 2. This is an $499 value.
 
 
Your Parent Or Kid Moved In: Are You Covered?
A record 57 million Americans now live in multigenerational family households — double the number in 1980, according to a new Pew Research Center study. And I bet many of them have the wrong homeowner’s or renters...
 
 
Pandora Looks to Challenge Terrestrial Radio's Dominance in Cars
Pandora Media is one of the largest Internet radio providers in the U.S. with more than 75 million active users. While the company’s active user count has increased at a robust pace historically, it is likely to slow...
 
 
Are General Manager Salaries About To Skyrocket? Will There Be A Front Office Salary Cap?
Are General Manager Salaries About To Skyrocket? Will There Be A Front Office Salary Cap?
It’s January 2026. New York Yankees owner Hal Steinbrenner gets out of his driverless car and triumphantly marches before the gathered press to introduce his prized new free agent. It’s a record-breaking contract—over...
 
 
 

Latest from the Network

Bieber, Gomez moving in together?
Los Angeles, Sep 19 (IANS) Singer Justin Bieber has reportedly asked his girlfriend Selena Gomez to move into his house here. As per a report in hollywoodlife.com, Bieber, who rekindled his romance with Gomez recently...
Read more on Celebrity Balla
 
Smoking causes urological diseases
Vienna, Sep 19 (IANS) Smoking leads to a number of urological diseases, experts said. Reduced fertility, impotence, and bladder carcinoma are problems caused by smoking, the Association of Austrian Urologists (BVU)...
Read more on Business Balla
 
Lily Allen shares tips for applying eyeliner
London, Sep 19 (IANS) Singer Lily Allen may have popular make-up artists taking care of her looks, but she knows it takes practise to perfect the art of applying eyeliner. In an interview with Now magazine, she said "...
Read more on Celebrity Balla
 
Baek readies himself for Asia-Pacific Golf Championship
Tokyo, Sep 19 (IANS) Korea's Baek Seuk-hyun is relishing the prospect of teeing up against some of the best players from the Asian Tour and Japan at next week's Asia-Pacific Open Golf Championship Diamond Cup....
Read more on Sport Balla
 
'No losers, only partners with Afghan unity government'
United Nations, Sep 19 (IANS) Head of the UN Assistance Mission in Afghanistan (UNAMA), Jan Kubis said there is "no better way forward" other than a unity government in the crisis-torn country. "There is no better way...
Read more on Politics Balla
 
'Angelina Effect' makes more women test for breast cancer
London, Sep 19 (IANS) The 'Angelina Effect' has more than doubled the genetic counselling and testing for breast cancer risk among British women. The 'Angelina Effect' is a term coined after actor Angelina Jolie...
Read more on Business Balla
 
Want good raise at work? Get a supportive wife
New York, Sep 19 (IANS) Do not just blame your boss or jealous colleagues for no promotion or salary hike at work - your spouse's personality is equally important to decide if your chosen career will make you richer or...
Read more on Apple Balla
 
Scotland's historic golf club to accept women members
Edinburgh, Sep 19 (IANS) Scotland's Royal and Ancient (R&amp;A) Golf Club has voted in favour of allowing women members for the first time in its 260-year history. Of the total votes, 85 percent were in favour of...
Read more on Sport Balla
 
Star Trek 3 will begin shooting 'in next six months'
Zachary Quinto believes 'Star Trek 3' will begin shooting within the next six months. The 37-year-old actor - who has also appeared in the popular sci-fi show 'Heroes' - has confirmed he expects to return to the iconic...
Read more on Movie Balla
 
It is time to move forward: Cameron
London, Sep 19 (IANS) It is time to move forward, said British Prime Minister David Cameron Friday after Scotland voted to stay with the United Kingdom. "The matter has been settled now for a generation. Or, as (...
Read more on Politics Balla