Crash and burn: Weak demand and dollar appreciation will cause manufacturers to move abroad

The past five years brought the rapid decline of the Major Household Appliance Manufacturing industry in Canada. Due to weak underlying domestic demand, the relative strength of the Canadian dollar and the high cost of labour, many of the industry's multinational companies chose to relocate production abroad. The high cost of labour, coupled with the relative strength of the Canadian dollar, proved disastrous for the industry's manufacturers over the five years to 2018. The Canadian-dollar effective exchange rate, which measures the value of the dollar relative to the currencies of Canada's main trading partners, rose substantially before the current period, while labour costs rose as the domestic economy recovered from the tumult of the recession...read more.

Industry Statistics & Market Size
Revenue
$452m
Annual Growth 13-18
-13.1%
Forecast Growth 18-23
Profit
Employment
1,086
Businesses
50
Market Share of Companies
There are no companies with a dominant market share in this industry

Industry Threats & Opportunities

  • The high cost of labour and the relative strength of the Canadian dollar hurt the industry
  • The strong Canadian dollar caused many major players to cease production in Canada
  • Improving domestic demand will provide the industry with some relief
  • Industry Report - Starting a New Business Chapter

    New entrants into the Major Household Appliance Manufacturing industry experience significant barriers, particularly from the high start-up costs associated with purchasing land, equipment and raw materials. Industry facilities typically require facilities of significant size and scale, as well as investment in automated machinery. Purchases of raw materials such as steel, plastic and rubber, which represent the single largest expense for industry operators, have shown significant volatility over the previous five years and have generally risen, representing a significant barrier for potential entrants. Additionally, labour costs in the industry are high because of the large number of employees required to produce major household appliances...purchase to read more.

    Additional Insights for the Major Household Appliance Manufacturing Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Major Household Appliance Manufacturing Industry are

  • Establishment of brand names
  • Market research and understanding
  • Development of new products
  • IBISWorld analysts also discuss how external factors such as Canadian-dollar effective exchange rate index and Housing starts in the Major Household Appliance Manufacturing industry impact industry performance..

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    What's in this report

    What is the Major Household Appliance Manufacturing Industry?

    This industry includes operators that manufacture major household cooking appliances, refrigerators, freezers, household laundry equipment and other major electrical and nonelectrical household appliances such as dishwashers, garbage disposal units, water heaters and trash compactors. Small cooking appliances (e.g. hot plates), fans, central and room air conditioners, vacuums and electric irons are not included in this industry.

    Industry Products
  • Household refrigerators and home freezers
  • Household laundry equipment
  • Household cooking appliances
  • Water heater appliances
  • Other appliances
  • Industry Activities
  • Household cooking appliances
  • Household refrigerator and home freezer
  • Household laundry equipment
  • Dishwasher
  • Garbage disposal unit
  • Electric and nonelectric water heater
  • Trash compactor
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Canadian-dollar effective exchange rate index
  • Housing starts
  • World price of rubber
  • World price of steel

  • Current Performance
  • Weak demand slows growth
  • Manufacturers flee abroad
  • Undermined profit margins
  • Chart: Revenue Growth

  • Industry Outlook
  • Domestic demand keeps the industry afloat
  • Import penetration cannibalizes the industry
  • Rising profit margins alter the industry landscape
  • Table: Major Household Appliance Manufacturing Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Major Household Appliance Manufacturing Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Homebuilders in Canada
  • Apartment & Condominium Construction in Canada
  • TV & Appliance Wholesaling in Canada
  • Consumer Electronics Stores in Canada
  • Commercial Building Construction in Canada

  • Key Selling Industries
  • Electrical Equipment Manufacturing in Canada
  • Metal Pipe & Tube Manufacturing in Canada
  • Other Plastic Product Manufacturing in Canada
  • Plastic Pipe & Parts Manufacturing in Canada
  • Steel Rolling & Drawing in Canada

  • Products & Services
  • Household cooking appliances
  • Household refrigerators and home freezers
  • Household laundry equipment
  • Other appliances
  • Water heater appliances
  • Chart: Major Household Appliance Manufacturing Industry Products and Services Segmentation

  • Demand Determinants
  • Wealth
  • Price
  • Value of the dollar

  • Major Markets
  • Exports
  • Retailers
  • Wholesalers
  • Direct Sales
  • Chart: Major Market Segmentation for the Major Household Appliance Manufacturing Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
    ProfitPurchasesWagesDepreciationOther
  • Chart: Cost Structure Benchmarking – Sector vs Major Household Appliance Manufacturing

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Major Household Appliance Manufacturing Industry

  • Industry Globalization
    There are no major players in this industry. This report includes analysis of other companies.
    Capital Intensity
  • Chart: Level of Capital Intensity for the Major Household Appliance Manufacturing Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Major Household Appliance Manufacturing Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Exports (2009-2023)
  • Imports (2009-2023)
  • Wages (2009-2023)
  • Canadian-Dollar Effective Exchange Rate Index (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Energy Star
  • An international standard for energy-efficient products. The label identifies major electrical appliances that meet or exceed the standards set in Energy Efficiency Regulations.
  • Linear Motor
  • A motor that uses linear movement (as opposed to rotational) to increase performance and reduce energy costs.
  • Smart Appliance
  • An appliance that operates when electricity is the least expensive and most abundant, which is determined by communicating with the electric meter.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Major Household Appliance Manufacturing market research report provides the latest industry statistics and industry trends, allowing you to identify the products and customers driving revenue growth and profitability. The industry report identifies the leading companies and offers strategic industry analysis of the key factors influencing the market.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Major Household Appliance Manufacturing:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Major Household Appliance Manufacturing market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Major Household Appliance Manufacturing, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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