2018 in brief
The Westermo business entity achieved its best year to date, with record order intake, sales and earnings in 2018. But this high growth also caused delivery problems, and investments in more capacity injections were made in 2018, which will progressively enable more cost-efficient production. After its successes in the train segment, Westermo is embarking on an offensive involving selective initiatives in the power distribution and rail infrastructure segments.
Offering and market
Robust network solutions for industrial data communication
Westermo provides mission-critical industrial data communication solutions. In simple terms, these solutions enable data to be transmitted across wired and wireless networks. Reliable data communication is imperative for digitalization where different systems are interconnected to enable various applications and equipment to be controlled and monitored. These solutions address the market for infrastructure and various industrial sectors. Digital networks are critical for managing the customer’s operations, and are often installed in exposed, harsh environments with electrical disruptions, dust, vibration and wide temperature fluctuations. This implies very stringent standards for environmental endurance, safety and reliability. Westermo’s network solutions are robust and specifically developed to satisfy customer needs for mission-critical systems.
Various research reports estimate the global market value of industrial network products at some 13 SEK billion. Investment cycles vary, with lower growth in some years, although in the long term, the market has achieved yearly growth of over 10%.
Westermo markets and sells network solutions through a range of channels. Its in-house sales resources consist of proprietary offices with sales forces in 12 countries. These offices serve end-customers direct, as well as system integrators. Sales are also via OEMs, which bundle our products into their own solutions. Our in-house sales resources are backed by a network of distributors on selected markets. Our in-house sales resources generated 66% of sales in 2018.
Westermo’s offerng addresses the infrastructure market, including transportation systems, energy systems and water supply, as well as a range of industrial sectors like the marine, mining and processing industries. Westermo is one of the world leaders in the train segment. Westermo’s estimated global market share in digital network solutions is 3–4%.
Westermo has a base of some 5,000 purchasing customers of differing sizes, including many major multinationals. The largest accounts are Bombardier, Progress Rail Locomotive, Alstom and Toshiba. The 10 largest accounts represented 45% of sales in 2018.