Impact of COVID-19 on the Global Generator Sales Market
The COVID-19 outbreak has negatively affected the global economy as the operations of various sectors have come to a standstill. In the power generation sector, companies are dealing with several challenges due to a decline in demand for electricity post-COVID-19. Furthermore, industries such as construction, manufacturing, tourism, and services have stopped operations completely, which has drastically impacted the generator sales market globally. Most companies in the generator sales supply chain have seized operations to ensure the safety of employees. However, some companies are operating at minimum capacity to support essential industries, such as utilities and manufacturing. Numerous utilities across the globe are dependent on generators for power supply. As the demand for electricity has declined globally, the demand for new generators has also declined.
FIGURE: DECLINE IN DEMAND FOR ELECTRICITY IN MAJOR ECONOMIES SINCE THE LOCKDOWN
Furthermore, the revenue generation for numerous utilities across the globe has declined due to the reduced demand for electricity. Additionally, utilities in developing countries, which still depend on manual meter readings for generating monthly bills are expected to incur losses in terms of revenue collection during the lockdown period. Revenue collection in such countries will decline during this period having a grave economic impact. Additionally, many government bodies across the globe are waiving off electricity charges for numerous households to reduce the financial impact on households. For instance, in April 2020, the government of Thailand announced that electricity charges for 22 million households would be waived off to reduce the financial impact on the citizens. This has been extremely helpful to the Thai citizens as the per capita income levels dropped substantially due to the pandemic. The decline in demand for electricity has directly impacted the demand for generators. However, as economies are planning to resume business to increase revenue generation gradually, the demand for generators is expected to resume its average growth rate by early 2021.
Source: Primary Experts, Secondary Sources, and MRFR Analysis