Market Definition
A diesel generator produces electrical energy from the chemical energy contained in the diesel fuel. The prime components of diesel generators include a diesel engine, an AC alternator, fuel tank, control panel, & radiator. These generators are highly beneficial during power outages and can be used either as an emergency power backup system or a primary electricity source. Since they provide uninterrupted & a continuous flow of energy, their adoption is rising significantly across commercial, industrial, & residential sectors of Mexico for various applications due to increasing power outages & transmission failures across the country.
Market Insights
The Mexico Diesel Generator Market is projected to grow at a CAGR of around 4% during the forecast period, i.e., 2021-26. The growth of the market is driven primarily by the rapidly increasing demand for uninterrupted & reliable power supply in several end-user verticals like manufacturing, power generation, oil & gas, construction, telecommunication, residential, & healthcare, among others, i.e., soaring the production & sales of diesel generators in Mexico.
In addition, the swiftly escalating population is further boosting industrialization & infrastructure developments, thereby positively impacting the Mexico Diesel Generator Market. Besides, the growing adoption of heavy machinery is also boosting the demand for diesel generators to avoid sudden disruptions in their functioning or situations of power outages.
Moreover, diesel generators are increasingly used in the healthcare sector to ensure a continuous flow of energy to run healthcare equipment & machines like ventilators even during power cut situations, which is another crucial aspect projected to drive the market in the coming years.
Key Trends in the Mexico Diesel Generator Market
Since a majority of industries run their business operations from physical facilities, they tend to require a continuous flow of power. However, failures in distribution networks & transmission due to climate changes, cable defects, etc., can cause difficulties & massive financial loss to companies. Therefore, both private & public industries are swiftly adopting measures to integrate a standby source like diesel generators for an uninterrupted energy flow across these industries.
| Report Coverage | Details |
|---|---|
| Study Period | Historical Data: 2016-19 |
| Base Year: 2020 | |
| Forecast Period: 2021-26 | |
| CAGR (2021-2026) | 4% |
| Key Companies Profiled | Caterpiller Inc., APR Energy, Cummins Inc., Kohler Co., Agreeko PLC., Generac México, S.A. de C.V., Atlas Copco AB |
| Unit Denominations | USD Million/Billion |
Impact of Covid-19 on the Mexico Diesel Generator Market
The Covid-19 pandemic in 2020 had a decelerating effect on most industries across Mexico, where the Diesel Generator Market was no exception. The Mexican government imposed stringent movement restrictions & lockdowns to curb the spread of this dreadful disease. As a result, most businesses witnessed a significant downfall in their growth, and the need for diesel generators also fell drastically.
In addition, owing to this downfall, most industries cut short their production and even shut their manufacturing facilities. Besides, ongoing construction projects underwent a temporary halt and negatively influenced the growth of the diesel generator market.
However, with the gradual betterment in the situation & ease of norms, the government allowed the recommencement of business operations. Hence, the market is likely to revive & regain its usual pace in the coming years. Furthermore, the Mexican government is also seeking constructive regulations to bring the economy back on track. As a result, numerous leading players in the market shall witness a plethora of remunerative growth opportunities in the years to come.
Market Segmentation
Based on Power Rating:
Of them all, diesel generators between 750.1 KVA-1000 KVA power ratings dominated the market with the largest share in recent years and shall prevail the same trend during 2021-26. It owes to the rising demand for a continuous electricity supply in high power operations across different industrial verticals like mining, oil & gas, manufacturing, construction, etc.
On the other hand, the demand for diesel generators between 75.1 KVA-375 KVA power ratings is anticipated to display substantial growth in the coming years, principally due to the rapidly increasing adoption of these generators in the residential & commercial sector and business facilities of several Small & Medium Enterprises (SMEs).
Based on End-User:
Of them all, the Industrial Sector is anticipated to dominate the market with the largest share during the forecast period. It owes to numerous ongoing construction activities in Mexico due to an increasing expenditure & focus of the government on infrastructure developments, i.e., soaring the demand for diesel generators to deliver a continuous & reliable power supply across different construction sites. Moreover, since the oil & gas sector is amongst the largest consumers of diesel generators, its swift expansion is another crucial aspect that would positively influence the market growth in the coming years.
On the other hand, the commercial sector is projected to acquire the second-largest market share during the forecast period, mainly due to the mounting utilization of diesel generators as a reliable power backup system across government centers, data centers, hospitals, & educational institutes, among several others, to deliver power supply, especially during power outages & voltage fluctuations.
Nonetheless, the Residential sector is expected to witness rapid market growth during 2021-26, owing to the burgeoning incidences of power cuts and the increasing load requirements on primary grids. Besides, since diesel generators are considered a reliable source of secondary power during transmission losses & failures in distribution networks, their demand is soaring significantly across several Mexican households to run home appliances during emergencies.
Based on Type:
Here, the demand for Peak Shaving generators is anticipated to display significant growth during 2021-26. It owes principally to the surging need for reliable & uninterrupted power supply at remote & isolated locations with poor grid infrastructure, i.e., augmenting the demand for peak shaving diesel generators. Additionally, the increasing number of manufacturing operations is likely to spur electricity requirements in Mexico, especially across industrial units with variable load operations. It, in turn, would further propel the demand for peak shaving generators & drive the overall market in the coming years.
Market Dynamics:
Key Drivers
The accelerated consumption of oil & gas in different industries is anticipated to fuel the growth of the Mexico Diesel Generator Market during 2021-26. In addition, the rapidly increasing number of hydrocarbon reserves & soaring exploration activities of offshore wells shall further boost the market. Moreover, massive investments in several energy management activities across different sectors is another crucial aspect projected to create lucrative growth opportunities for the leading players in the diesel generator market of Mexico over the forecast years.
With the swiftly developing industrial infrastructure across Mexico, the need for a continuous electrical supply is infusing the demand for diesel generators in the country either as a primary power source or during emergencies and, in turn, is driving the market. Besides, since the industrial sector of Mexico is amongst the largest consumers of electricity, the government & prominent players are massively investing in the production of diesel generators for efficient energy management across different industries, i.e., projected to generate significant growth opportunities for the market through 2026.
Growth Restraint: Stringent Government Regulations on Carbon Emissions and Availability of Clean Energy Alternatives
With the swiftly alarming concerns over the environment, pollution, & carbon emissions, the Mexican government is laying out stringent restrictions on using diesel generators and promoting the adoption of clean energy generation technologies. Hence, it might act as a prominent growth restraint for the Diesel Generator Market during the forecast period.
Competitive Landscape
According to MarkNtel Advisors, the leading players in the Mexico Diesel Generator Market are Caterpiller Inc., APR Energy, Cummins Inc., Kohler Co., Agreeko PLC., Generac México, S.A. de C.V., Atlas Copco AB
Key Questions Answered in the Market Research Report:
Market Outlook, Segmentation, and Statistics
Frequently Asked Questions
A. The Mexico Diesel Generator Market is projected to grow at a CAGR of around 4% during 2021-26.
A. The Industrial sector is anticipated to emerge as an area of remunerative growth opportunities for the leading players in the Mexico Diesel Generator Market during 2021-26.
A. The rapidly increasing adoption of diesel generators, especially for oil & gas exploration activities across Mexico, is anticipated to provide profitable growth opportunities to the Mexico Diesel Generators Market in the coming years.
A. With the upliftment of lockdown & movement restrictions, several leading players in the Mexico Diesel Generator Market that have resumed their operations are actively working on bringing innovations in diesel generators that emit extremely low pollutants. As a result, the market shall witness significant growth opportunities in the coming years.
