Positive signs for major domestic appliances

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Data recorded in Italy during 2015 show an encouraging trend for Mda sector, thanks to technological news and the extension of Eco-bonus.
Regarding the singular segments, Washing holds the biggest share both in volume and in value terms

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by Elena Corti

Innovation, energy efficiency and incentives: these are the main ingredients of the recovery that is characterizing the sector of major domestic appliances and lays encouraging foundation for this year. The rapid technological evolution stimulates the replacement of outdated models, also favored by the fiscal Eco-bonus extension in 2016. Considering the figures released by GfK, sales of major domestic appliances sector totalizes about 3 billion euro in 2015, an increase of 2.8% compared to the previous year. Trend in volume is similar, with sales rising by 2.7% compared to 2014. Among the several segments, Washing recorded the highest growth trend, with an increase of 4.9% in value and 4.7% in units sold. The Cooling sector follows, with sales increase of 3% in value, and of 2.2%. in units year on year. Comparing the results in 2015 with those in 2014, there has been the turnaround: in 2014, in fact, trends compared to 2013 were negative both in value and in volume (-1.8% and -1.4% respectively).
Trend of Cooking segment (floors, freestanding kitchen, ovens, hoods) was, instead, less positive, recording in 2015 a decline in sales value (-0.6% compared to 2014), while in 2014 it marked a growth of 1.7% compared to 2013.
Sales in units were slightly positive (+ 0.5%), although less than they did in 2014 (+2.6% over the previous year).
Considering then the weight of the different segments on the total, Washing share in value was equal to 44.7% in 2015, up from 43.9% in 2014. Cooling comes in second place with 29.2% both in 2015 and in the previous year. Cooking share is instead declining, decreased from 26.9% in 2014 to 26% in 2015. 3 Lavastoviglie_TelefunkenIn terms of share on volumes, Washing accounted for 43.5% of the total units sold in 2015, increasing its weight compared to 42.7% in 2014. Cooling remained stable (26% last year, 26.1% in 2014), while Cooking saw a reduction in unit share from 31.2 % in 2014 to 30.5% in 2015.
In addition, the Observatory of Findomestic highlights the positive contribution to the market trend resulting from the freestanding segment both in terms of volumes and of value, unlike the built-in sector which reported declines in both areas. The survey, which is based on data by GfK Retail and Technology for the first three quarters of 2015, pointed out that the performance of dryers was very good, with a double-digit growth that reached +40% on freestanding channel. According to the Observatory, this is one of the most promising products, with wide margins of penetration in Italian homes. Another category showing a positive trend is that of washing machines, not only for the promotional policies of the distribution but also for the breadth of its offer, that ranges from smart models to unconnected versions but multifunctional and featuring a large load capacity and high performance in terms of energy efficiency. Finally, to the good results of Cooling all the main product categories contributed, while the sluggish performance of Cooking sector reflects the negative contribution of the built-in segment. The demand has rewarded especially the latest generation hobs, such as those with induction technology, and hoods to which the high content in terms of design and functionality is recognized.

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Also sell-in is positive again
In 2015, for the first time since 2009, major domestic appliances recorded a positive result in sell-in. According to data released by Confindustria Ceced Italia, in fact, Washing, Refrigeration and Cooking achieved a total growth of 5% compared to 2014. However, in parallel with this result, we must consider the further decrease in the production volume in Italy, which has lost about 227,000 units, with a particularly significant decrease as regards washing machines (-19.8%). Opposite sign, instead, is recorded by the Italian production of refrigerators and freezers, which marks its first positive result since 2002, coming at +8%. Regarding hoods, Confindustria Ceced Italia underlines the increase in world demand which, despite a contraction in the third quarter of 2015, recorded a growth of 2% in Western Europe and of 5% in the United States. The introduction of A+ energy class during this year will give a good contribution to the sector vitality.
This news will reposition demand and production of more efficient models with an higher average price, considered the highest level of technology required to obtain the new class.
We also mention something about the professional equipment sector which rose in value by 7%. According to what reported by Ceced, in 2015 Italy maintained a leading role in terms of quality and innovation, opening up to new markets.
The Association finally stressed the benefic effect of tax deductions for building renovations and energy efficiency: according to Confindustria Ceced Italia, in January 2016 sell-in remained positive also thanks to the confirmation of the incentives.

WASHING AND COOLING: RETAIL AWARDS THE EFFICIENCY
Distribution, according to what emerges from IFR surveys about Washing and Cooling segments in 2015, continues to focus on efficient models that have a significant presence on the shelf. Washing machines in A+++ class had the highest share (55.1%), followed by A++ models (23.2%) and by those in A+ class (13.6%). Much lower the presence on shelves of products in A class (6.7%), rendered obsolete by the availability of more efficient appliances with competitive average prices: if A class in 2015 had an average price of 647.72 euro, A+ class went down to 387.26 euro and A++ reached 467.32, while A+++ class came to 669.84 euro. As regards dryers, the biggest part of the shelf was occupied by models in A++ class (43.6%) and A+ (34.6%). A lower percentage was instead dedicated to products in A+++ class (7.7%) and A (8%). Regarding dishwashers, the biggest presence on the shelf regards A+ models (42.8%) and A++ (36.1%.).
Class A follows (11.2%), while the most efficient class (A+++) had a share of 7%.
These products have a higher average price, which exceeded 820 euro in 2015, with a significant difference respect the average price of models ranging from the A class and A++.
As regards Cooling, refrigerators in A+ class had the greater presence on the shelf in 2015 (59%), together with appliances in A++ class (31.2%). The most efficient products (A+++) achieved a share of 8.5%, while class A was below 1%, with a presence on the shelf much lower than A+ models that have a similar average price. Finally, even among freezers A+ class obtained the largest share on the shelf, which recorded 77.9%, far outdistancing the other classes: A++ models reached 15%, A class achieved 2.4%, while A+++ products recorded a presence on shelves of only 0.6%.
Major domestic appliances (Mda): market share in units and value
UnitsUnitsValueValue
2014201520142015
Total Mda100.0%100.0%100.0%100.0%
Washing42.7%43.5%43.9%44.7%
Cooling26.1%26.0%29.2%29.2%
Cooking31.2%30.5%26.9%26.0%
Source: GfK