S. Jensen
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How Company Mergers Bring Expanded Market Opportunities

Oct. 5, 2022
Through mergers and acquisitions, companies have the opportunity innovate faster and serve new markets.

I recently had the chance to attend the 2022 Danfoss Distributor Meeting which was held for the first time since the acquisition of Eaton’s hydraulics business. Under the theme of Stronger Together, the company highlighted the many benefits of the merger as well as the technological areas in which Danfoss Power Solutions is focusing design efforts.  

READ MORE: What are the Impacts of Industry Consolidation?

Eric Alström, President of Danfoss Power Solutions, cited during the event that expanded manufacturing space was one of the benefits which came from the merger with Eaton. It now has 53 factories around the world, enabling it to better serve Danfoss’ global customer base. The company has also been able to expand into new markets such as industrial and fluid conveyance; it now has eight divisions under its belt, allowing it to serve a wide range of industry segments.

In the image above, a new solution developed for the industrial division showcased at the distributor meeting brings together Eaton and Danfoss technologies, further demonstrating the benefits of the merger by enabling new solutions to be created through a combination of products from the two companies.

Bosch Rexroth and HydraForce noted similar benefits when announcing their merger in July. HydraForce will become a part of Bosch Rexroth’s Compact Hydraulics portfolio, enabling an expansion of product offerings for that industry segment. In addition, HydraForce will bring additional manufacturing footprints in new regions as well as an increased global sales network.

With mergers like these, companies can not only better solidify their presence in an industry but also improve their ability to serve customers. For instance, the increased manufacturing capacity possible through an acquisition allows a company to produce more products while also doing so closer to the customer – making for faster delivery which is essential these days with the supply chain struggles so many companies are facing.

Enhanced Capabilities and Technology

Alström said Danfoss plans to invest in its factories and supply chains. This will include a focus on regionalizing supply chains to support customers by providing better availability and on-time delivery he said.

In addition, Danfoss will continue to invest in its product portfolio by expanding offerings as well as maintaining and strengthening existing brands including those from Eaton said Alström. He emphasized during the event the company remains bullish on hydraulics while at the same time working on newer segments such as electrification and autonomy. This ensures the company serves both current and future market needs.

Hydraulics will remain an important technology in many industries due to the force it provides, such as in heavy-duty mobile equipment. However, opportunities exist to improve its efficiency and other aspects. And even as electrification becomes more prevalent, opportunities will exist for the continued use of hydraulics.

READ MORE: Positive Market Conditions Will Continue for Hydraulics and Pneumatics

During its distributor meeting, technology developments being undertaken by Danfoss’ various divisions were highlighted. The industrial division, for example, noted it is working on new pump products offering more sizes, longer service life, and lower noise levels.

Aiding all of the new technology developments is the increase in engineering resources which came with the Eaton acquisition. Jeff Herrin, Senior Vice President, Research and Development at Danfoss Power Solutions, said during the event the company now has a powerhouse engineering team consisting of 1,800 engineers around the world.

This enables innovation to take place almost around the clock and move at a faster pace. Herrin also said it provides access to knowledge and competencies which can potentially be applied to a variety of markets and applications, further benefiting the company’s development efforts.

Bringing new technology to market can benefit the industry by helping it advance and remain relevant while also offering solutions customers need. As Herrin stated, you can’t do technology for technology’s sake, you have to make sure you’re developing application solutions. And that is exactly what Danfoss is aiming to do after its merger with Eaton’s hydraulics business bring products to the market which will benefit customers.  

We want to hear from you! 

What benefits do you see from companies merging? How can the fluid power industry benefit? What further industry consolidation do you foresee? 

Let us know! Email me at [email protected] or reach out to us on social media

Twitter: @TechnlgyEditor or @PowerMotionTech

LinkedIn: @PowerMotionTech

About the Author

Sara Jensen | Executive Editor, Power & Motion

Sara Jensen is executive editor of Power & Motion, directing expanded coverage into the modern fluid power space, as well as mechatronic and smart technologies. She has over 15 years of publishing experience. Prior to Power & Motion she spent 11 years with a trade publication for engineers of heavy-duty equipment, the last 3 of which were as the editor and brand lead. Over the course of her time in the B2B industry, Sara has gained an extensive knowledge of various heavy-duty equipment industries — including construction, agriculture, mining and on-road trucks —along with the systems and market trends which impact them such as fluid power and electronic motion control technologies. 

You can follow Sara and Power & Motion via the following social media handles:

X (formerly Twitter): @TechnlgyEditor and @PowerMotionTech

LinkedIn: @SaraJensen and @Power&Motion

Facebook: @PowerMotionTech

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