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THE
CONNECTION BETWEEN THE CHINA AND UNITED STATES HVAC INDUSTRY |
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NARRATIVE OF THE HVAC INDUSTRY |
EnStar has been involved in the Chinese HVAC industry for more than
15 years, and we have a very strong background with HVAC manufacturers.
Our extensive knowledge in this field has been further increased
by joint ventures with Sunwill Electrical Appliances, and business
partners such as Gree Electric Appliances, Inc of Zhuahai (China)
and Dalian Sanyo Compressor Co., Ltd., .
Since our primary business focus is the HVAC industry, we can provide
superior industry and customer marketing information regarding the
products and services within the industry. Our staff has a great
knowledge of both the Chinese and North America markets. Our structure
for understanding this industry consists of three key elements:
technology, industry and the customer.
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We need to review the market and industry environment in the United
States using statistical data from ARI. The imported revenue sharply
increased in the US from 2000 to 2004, with the number of imports
recorded increasing an average of 23% per year. This change began
in the low end products (e.g. 15,000Btu/h under for room air conditioner),
then spread to the high-end products in steps to the other product
categories including condensing units ranging from 18,000Btu/h up
to 66,000Btu/h. Nowadays, we see made in China products everywhere
in the US market . What drives this to happen? The market nature and
the major players in this industry. When you see the Wal-Mart stories
across the country selling a wide vary of quality products at extremely
competitive prices you know the answer. For whatever reason, the consumers
want to
pay less, and they are eager to see lower-priced, quality products
on the market. On the other hand, the major players need to meet the
market demands in order to maintain their market position (keep profit
levers), and thus they have to pursue outsourcing and OEM programs
outside the North America. Most outsourcing business has most gone
to the Fareast, primarily to China. Therefore, we see the major players
in the industry making outsourcing a necessity and changing the way
industry must do business.
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Big players in HVAC industry have taken prompt action to develop business
with China, some more aggressively than others, and we have witness
big changes in the HVAC industry in recent years. This trend seems
unstoppable and will probably continue long into the future. Thus
a change in the ranking of the air conditioning manufacturers is inevitable,
there is no doubt about it. Anyone who wants to be a winner in the
market and the customer in the future must take action now!
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EnStar knows China, and we know all the key people throughout
the HVAC industry, and we can provide a wide variety of purchased
parts and components including metal, rubber, and plastic parts,
injected molded parts, tooling, and assemblies of semi-finished
and finished products under your private name (OEM program). The
manufacturing centers in China can produce high quality parts
with competitive prices, and they beat Japan and the US in quantity
and revenue in 2004. Product catalogues will spread to the core
products in North America. Production of low-end products has
been shifted to the Far East, primarily to the China.
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We
have many successful cases of helping North American based companies
and manufactures locate the right platform in China to produce their
products in today’s highly competitive market.