Electrolux 2011 Annual Report Download - page 26

Western Europe
– a fragmented market
Western Europe is the Group’s largest market for consumer durables and products for professional
users. Electrolux focuses on growth through the launch of new, innovative appliances in the pre-
mium segments. Built-in appliances is a priority area.
The market in Western Europe is dominated by replacement prod-
ucts as a result of high penetration in most product categories and
low or stagnated population growth. Meanwhile, an increase in the
number of households due to a rising share of older people com-
bined with the small living spaces in most homes, has led to higher
demand for compact and user-friendly products. Therefore, the
market for built-in appliances is a growing segment in Europe.
In 2011, deliveries of core appliances amounted to about 52 mil-
lion units, down by 12% on the record year of 2006. The sharp
deceleration in primarily Southern Europe had a negative impact on
development. The market remained subject to price pressure and
intensified competition from Asian manufacturers, among others.
A fragmented market
Europe is a complex market. Many countries and language areas
have resulted in widely varying consumer patterns and the establish-
ment of a large number of manufacturers, brands and retailers for
appliances. The low degree of consolidation among manufacturers
is one reason for overcapacity and price pressure in the industry. The
European market features many small, local and independent retail
chains that focus on electrical and electronic products as well as
kitchen interiors. Kitchen specialists currently account for approxi-
mately 25% of sales of household appliances in Western Europe. The
corresponding figure for Germany and Italy is approximately 40%.
The market for professional kitchens is characterized by the pres-
ence of many manufacturers who often specialize in only one prod-
uct category. Conversely, the market for professional laundry equip-
ment is served by fewer players able to supply a larger product
portfolio.
The Group’s position
Electrolux is the only producer in the market that can provide solu-
tions for both consumers and professional users of kitchen appli-
ances and laundry products. In recent years, the Group has further
strengthened its position in the built-in segment for core appliances,
mainly in the German market. In 2010 and 2011, the Group launched
new built-in products in the premuim segment under the AEG brand.
In 2012, the Group will move forward with the launch of an entirely
new range of built-in products under the Electrolux brand.
For professional users, Electrolux has a strong position with inde-
pendent restaurants and institutions.
Electrolux is one of the leading producers of floor-care products
in the world and one of few with a global distribution network. The
Electrolux brand dominates the Group’s sales in Europe, one of the
Group’s largest markets.
Fast-growing product categories
The market for built-in appliances continues to show growth and
interest is strong in energy- and water-efficient appliances. Dish-
washers comprise a fast-growing segment in the region. Electrolux
manufactures dishwashers designed and adapted for all types of
kitchens and households. In 2011, the Group launched new, innova-
tive and water-efficient dishwashers under the AEG brand. Attrac-
tively designed, rechargeable and instant vacuum cleaners dis-
played substantial growth. The market for bagless vacuum cleaners
also grew.
Professional food-service and
laundry equipment
Major appliances
32% Small appliances
Net sales in Western Europe have been
impacted by the slowdown in market
demand.
07
50,000
40,000
30,000
20,000
10,000
0
08 09 10 11
SEKm
Net sales in Western Europe
100
80
60
40
20
0
Cookers
Refrigerators
Washing machines
Tumble-dryers
% of households
Product penetration
Shipments of core appliances
in Western Europe
annual report 2011 mature markets
Share of sales in the region 2011Share of Group sales 2011
03
65
60
55
50
004 05 06 07 08 09 10 11
Million units
A total of approximately 52 million core appli-
ances were sold in Western Europe in 2011,
a decline by 3% compared with 2010.
Source: Electrolux estimates.
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