2024 Q3

2024 was a mixed year for the diesel generator sets industry.  

We have analyzed data as far as Q3 (Q4 will be available around late April / early May).  

And while the overall industry is likely to grow by a double-digit percentage across the full year, it may not have seemed like that for some producers.

The numbers reflect a multitude of factors in play across the world:  some driving growth, others slowing it down.

We'll take a brief look at some of these below.

2024 Q3 Growth by Power Bands

Overall, in value terms, in Q3 of 2024 the industry was 14% larger than Q3 of 2023, including overall price inflation of around 4%.  

But the power bands tell their own growth stories.

At ratings below 1,500 kVA, the industry grew by 4% compared with Q3 of 2023, which, excluding price inflation means it was flat.  

Above 1,500 kVA the familiar growth picture remains, with more than 30% growth compared with Q3 of 2023.  At ratings between 2,000 and 4,000 kVA, growth is more than 40%, driven mainly by the data center sector.

Below, we'll look at some of the regional drivers behind this and at how the full 2024 year may look.

2024 Full Year Forecast

The year that producers of diesel generator sets experienced in 2024 depends much on where and what they produced.

• Almost 90% of industry growth in 2024 is likely to come from the power bands 2001 - 4000 kVA.

• While power bands from 7.5 - 750 kVA account for slightly less than 0% of growth:  in other words, there was a slight decline, and a decline of 4 or 5% if the effect of price inflation is excluded.

Across 2024, more than 40% of global industry growth is likely to have come from North America and a similar proportion from the Asia Pacific region.

2024 Full Year Forecast

Global Market Below 1,500 kVA

Below 1,500 kVA, there's evidence of a slight slowdown globally, but with no single reason.  Just a confluence of multiple factors, some short term, others more permanent.  

For most of 2024, at ratings below 1,500 kVA North America was in a slight decline, particularly at ratings below 750 kVA:  around -7% in value terms, -8 to -14% in unit terms.  However, we see this as a blip and not part of a longer term trend. The region has seen substantial growth post-Covid and the long term market environment remains strong.  

In Europe, 2023 had been an exceptional year and was always unlikely to be matched in 2024.  In 2023, fears of electricity outages had pushed the market up substantially, especially in central Europe.  And demand had also been strong from Ukraine.   But in 2024, fears of outages subsided and the market readjusted back to more normal levels.  This has been felt most in countries like Germany where Q3 of 2024 is down 24% on the same quarter in 2023.  There's evidence that the readjustment in Europe in 2024 may have bottomed out and normality is returning, although many European economies remain fragile.  

In 2024, Ukraine will come close to 22 / 23 levels and we expect the market to reach a value of around $250m.  

The net effect is that below 1,500 kVA, the Europe market is likely to be down around 12% on 2023, 16% down if price inflation is excluded.  

Across 2024, Africa is likely to see around 4% growth, flat when the effect of price inflation is excluded. Although there is healthy growth in some countries, for example Ivory Coast and Ghana, these are counterbalanced by declines in others, in particular by South Africa which is down almost 50% as load shedding reduces.  

Latin America is likely to be flat on 2023, with a 4 - 5% decline when the effect of price inflation is excluded.  Ecuador and Venezuela, where there are high levels of power outages, are likely to be particularly strong markets across 2024.  

The Middle East is likely to have a strong 2024, up more than 10%.  Saudi Arabia is likely to be the fastest growing market across the year, growing around 30%, driven by a very strong construction sector.  

India is likely to have a very positive 2024.  A year ago it was thought likely that the new Central Control Pollution Board (CPCB) emissions regulations would dampen demand, but this has not happened.  We expect growth of around 10% in 2024.

China growth is likely to be around 6%, 1 – 2% excluding price inflation. 

2024 Full Year Forecast

Global Market Above 1,500 kVA

Across 2024, above 1,500 kVA the industry is likely to grow by around 30% overall.  

We expect to see the fastest growth in the 3,001 – 4,000 kVA power band, at more than 40%, and around 30% in the 2,001 - 3,000 kVA power band.  

In regional terms, the global market above 1,500 kVA is dominated by North America which has around 45% of the overall opportunity.  

But in growth terms, the fastest growing regions are typically in Asia Pacific, particularly Malaysia and Australia.  

Most of this growth is driven by the data center sector, although there's also evidence of mining sector growth, particularly in Africa.  

The Story of 2024

The industry numbers in 2024 really tell two stories.

The first is that much depends on being in the right place at the right time.  

Across the world, from region to region and across the power bands, market conditions can be strikingly different.  

A producer of diesel generator sets whose main market is in Europe below 1,000 kVA will probably have experienced a tough 2024.  Markets will have been softer, industry capacity will have exceeded demand.  

But a producer of diesel generator sets selling mainly units above 2,000 kVA in any region, particularly in North America or Asia Pacific will have seen continuing strong demand and market growth.  

Secondly, the industry numbers tell a story of growth where the value proposition of diesel generator sets is strong.  

Diesel generator sets have carved out a valuable niche when immediate power is needed for a short time.  

They start immediately and accept load quickly.  

And this makes them ideal for emergency situations or critical standby power applications like data centers, healthcare or critical manufacturing processes.  It also makes them ideal as a short term solution where the grid has been damaged.  

And for the foreseeable future, this doesn't look like it's going to change.