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The water pump market plays a significant role in Vietnam's current economy, particularly the industrial water pump segment. It supports the country’s urbanization and industrialization efforts, driving progress toward greater global economic integration. However, the current state of the market reveals that it remains insufficiently funded and holds substantial untapped potential. Therefore, we will conduct a more in-depth analysis of the industrial water pump market in Vietnam to provide a more comprehensive perspective on this promising sector.
Overview of the Current Global Water Pump Markets
The water pump market is vital to industries such as water management, chemicals, oil and gas, and power generation, especially in developing countries. In 2023, the global water pump market was valued at approximately USD 67.76 billion.
According to Future Marketing Insight Inc., the global industrial pump market is projected to reach USD 68.0 billion by 2024 and grow to USD 113.5 billion by 2034, with a CAGR of 5.3% during the forecast period. Centrifugal pump sales are expected to increase at a CAGR of 2% through 2034, resulting in an absolute dollar opportunity of USD 53.8 billion from 2024 to 2034. Prominent companies in the global market include KSB SE & Co. KGaA, Xylem Inc., Sulzer Ltd, Torishima Pump Mfg. Co., Danfoss A/S, and ITT Inc., among others.
The Water Pump Market in Vietnam and Leading Companies in the Field
In Vietnam, the water pump market has garnered increasing attention in recent years, especially after the COVID-19 pandemic. Quang Phuoc PE, the official distributor of Ebara-standard pumps, reports that 2019 experienced significant growth, driven by a construction boom, with an average annual growth rate of 9.3%. By the end of 2019, the value of the standard industrial water pump market was approximately USD 144 million.
Looking ahead, the Vietnamese water pump market is projected to grow at a CAGR of approximately 8.3% from 2024 to 2030. This growth is driven by urbanization, industrialization, and expansion of infrastructure. The increasing population and development of the industrial sector have significantly boosted the demand for water pumps. In particular, Vietnam's large-scale agricultural sector heavily relies on water pumps for irrigation purposes.
As a result, the water pump market in Vietnam is highly diversified, covering various segments such as:
- Agricultural Pumps: Irrigation pumps, drainage pumps, solar-powered pumps
- Industrial Pumps: Centrifugal pumps, submersible pumps, booster pumps, dosing pumps
- Urban and Infrastructure Pumps: Water supply pumps, wastewater and sewage pumps, stormwater and drainage pumps
- Residential and Domestic Pumps: Household water supply pumps, pressure booster pumps, submersible well pumps
- Flood Control and Disaster Management Pumps: High-flow drainage pumps, mobile and emergency pumps
- Renewable Energy-Powered Pumps: Solar-powered water pumps, wind-powered water pumps
- Water Treatment and Desalination Pumps: Pumps for filtration systems, reverse osmosis (RO) pumps
- Fire Protection Pumps: Fire Fighting pumps
- Specialty Pumps: Chemical pumps, slurry pumps
In 2023, Grundfos Vietnam developed a new series of end-suction pumps designed to support the growth of smart and sustainable cities. The NK and NKE ranges feature advancements in energy efficiency, connectivity, and durability. More recently, on June 26, 2024, EBARA VIETNAM CO., LTD. hosted a seminar at its Hai Duong plant to showcase large-flow pumps intended for future flood drainage applications, emphasizing Vietnam's ability to manufacture pumps with capacities exceeding 10 m³/s.
Ebara Vietnam is a prominent player in Japan's industrial equipment sector. It entered the Vietnamese market in 1961 as a joint venture with Hai Duong Pump Company. In 2011, it became a wholly owned subsidiary of Ebara Corporation and was subsequently renamed as EVPC. Ebara has contributed significantly to infrastructure development for over 20 years in Vietnam. Similarly, on May 31, 2019, South Korea's DOOCH Group, a global pump market leader, officially established its presence in the Vietnamese market.
The Future Trends of the Water Pump Market
As previously noted, the growth rate of the water pump market in Vietnam is highly promising, establishing a foundation for substantial expansion in this sector in the coming years, particularly within industrial pump segments, including centrifugal pumps. Various indicators suggest that this trend extends beyond Vietnam with significant global interest in this segment as well.
Additionally, global oil refining capacity reached 101,902 barrels per day in 2022, reflecting a 0.5% increase from the previous year, further amplifying the demand for centrifugal pumps. Over 416 refineries are expected to commence operations between 2021 and 2025, including approximately 93 new projects, all of which play a crucial role in the development of this market.
In Vietnam, the chemical industry accounts for 10-11% to the industrial sector's GDP and is expected to maintain this growth rate until 2030, representing 4-5% of the industrial economy. This growth presents a favourable outlook for the industrial water pump market, driving a rise in demand, especially for centrifugal ones.
The positive displacement pump market is experiencing promising growth alongside the centrifugal pump market. According to Mordor Intelligence, the global market is expected to achieve a CAGR of over 4.8% between 2022 and 2027, primarily driven by advancements in water and wastewater treatment technologies. A 2020 report by the United Nations University highlighted that high-income countries treated 74% of their industrial and municipal wastewater, compared to 43% for upper-middle-income and 26% for lower-middle-income countries.
Currently, the industrial water pump market is being influenced by several emerging trends, including:
- Smart Pumps with IoT Integration: The adoption of smart pumps equipped with sensors and IoT technology is increasingly popular, enabling enhanced performance monitoring and improved reliability.
- Sustainable Water Management: The demand for solutions that promote water conservation and efficient wastewater management is on the rise. These drive efforts to protect the environment and tackle the critical challenge of ensuring clean water availability in the face of resource scarcity.
- Renewable Energy Pumps: Solar-powered water pumps are becoming more prevalent, especially in rural areas with unreliable grid electricity, thus contributing in energy conservation and environmental preservation.
Driving Forces for Investors
Vietnam’s water pump market has established a stable foundation for development. Additionally, with policy adjustments aligned with the country's development roadmap, key drivers set to accelerate the expansion of this market.
Industrial Growth: According to the General Statistics Office (GSO), industrial output increased by an estimated 8.34% during the first nine months of 2024. The processing and manufacturing sector, in particular, recorded a 9.76% increase, boosting overall economic development. This upward trend is expected to drive demand for water pumps across various industries, creating opportunities for investors in Vietnam.
Agricultural Sector: Agriculture remains vital to Vietnam’s economy. Although the sector did not meet its $54 billion export goal, it recorded a surplus of $12.07 billion in 2023, highlighting strong demand for agricultural water pumps for irrigation and drainage.
Urbanization and Infrastructure: Vietnam's urbanization is on the rise, with projections indicating that over half the population will reside in urban areas by 2040. This growth necessitates improvements in water supply and wastewater systems, positioning eater pumps as a critical component in meeting these demands.
Government Policies: The Vietnamese government has prioritized infrastructure development, focusing on hydroelectric and thermal power projects. With an estimated $30 billion required for water supply upgrades, the government is actively seeking private investment to modernize infrastructure, further increasing the market’s demand for water pumps.
Challenges for Investors
Despite the strong drivers pushing the growth of the water pump market, investors face significant challenges. One of the primary obstacles is the high cost of energy. Currently, there is a strong preference for energy-efficient pumps, which necessitates a technological shift to meet market demands. However, the high initial costs associated with adopting these new technologies could potentially hinder the pace of this transition.
Another challenge is the level of competition. The water pump market in Vietnam has witnessed the entry of numerous well-established brands, both domestic and international companies. This has resulted in intense competition, with these brands offering a wide range of pumps catering to various market segments. As a result, investors must adopt effective market entry strategies and conduct thorough competitor analysis to succeed in this competitive landscape.
Finally, although the government has implemented policies to modernize water supply and drainage systems and to build hydropower projects, these initiatives are still in the early stages. Consequently, the demand for water pumps, particularly industrial pumps, has not yet experienced a significant surge. Moreover, the Vietnamese government has not implemented specific policies targeting the water pump market in terms of investment. Investors must thoroughly examine investment policies and regulations under the Investment Law, understand the available incentives, ensure compliance with state regulations to avoid any potential violations.
Conclusion
Overall, the water pump market continues to play a crucial role in Vietnam's economic development. As the country continues to develop, there is sustained demand for water pumps to support both industrial and agricultural production. The Vietnamese government also acknowledges the potential of the water pump market, not only for domestic economic growth but also for attracting international investors. Efforts are underway to offer tax incentives and improve infrastructure to transform this hidden opportunity into a prime investment prospect. For investors, the market present expanding opportunities. The question of who will seize the opportunity, capitalize on this growth and establish a strong foothold in Vietnam's water pump market remains unanswered.
