Industrial Manufacturers are looking to emerging market economies as important markets in their own right. They offer clear opportunities for growth in a post downturn economy.
We think the reasons for this trend are clear. Infrastructure spend is on the rise. Existing customers are getting bigger. Sectors like mining, agriculture, and construction are key customers for industrial machinery and equipment makers, and in the emerging markets these areas are growing fast. Overall industrial production is growing, and as these economies get bigger, they’ll also be the source of most new customers. Leading the way are the BRIC countries – Brazil, Russia, India and China – the focus of this report. In 2008 China and India each produced 111 new multinational companies (MNCs); we expect the number of new MNCs will continue to rise in both countries over the next decade or so with India overtaking China for the top position around 2018.1 The other two BRIC countries, Brazil and Russia, will also produce significant numbers of MNCs, as will Malaysia, Singapore and Korea.
Some companies are already earning major revenues from emerging markets. In this paper, we highlight some examples of manufacturing companies who are already building plants, working with local partners and governments, conducting research – and most importantly, generating significant sales – in key emerging markets. We take a look at why they’ve been successful, and what we think is likely to happen next.