North America
Major Appliances
The US appliance market saw a strong growth in 2013 after several years of declining demand. Electrolux strengthened its position in the region and increased sales as a result of new product launches and the addition of new customers and new sales channels. The focus of Electrolux is to strengthen its position in the market by offering new innovative products across several price segments and brands.
Jack Truong
Head of Major Appliances North America
|
Share of net sales 2013 |
Share of operating income |
|---|---|
| 29% | 51% |
Market position
- Major Appliances 23%
Electrolux commands a strong position in the US and Canada, particularly for kitchen appliances, such as cookers, refrigerators and freezers. The Group’s appliances are predominantly sold under the Frigidaire brand in several price segments and under the Electrolux brand in the premium segment. The Group strengthened its market shares in North America as a result of such activities as successful product launches, new distribution channels and increased investments in innovation and marketing. During the year, Home Depot grew into a new significant distribution channel.
Growth and innovation
The core appliances market grew by about 9% during the year. The increase was mainly related to the improvement in the US housing market. There is considerable potential for further growth since demand is still approximately 20% below historic peak levels. During the next few years, growth in housing construction is expected to be particularly strong for single-family homes. Another interesting trend is that the premium segment is growing in parallel with the region’s ageing population. In the premium segment, Electrolux has a strong and broad product offering through its Electrolux brand. The product range was broadened during the year and a number of innovative products were launched, such as OrbitClean dishwashers and kitchen appliances with smudge-proof stainless surfaces under the Frigidaire Gallery brand and the Perfect Temp drawer for refrigerators under the Electrolux brand.
North American homes generally have ample space for many household appliances, including large appliances. The high degree of product penetration combined with relatively low population growth has resulted in replacement products dominating the market. The market is also more uniform than most markets, which has led to a relatively high level of consolidation among manufacturers and retailers. The three largest manufacturers of appliances in the US account for a major part of the market and about 70% of appliances are sold through four national retailers – Best Buy, Home Depot, Lowe’s and Sears.
Operational excellence
An important part of the Electrolux strategy to grow profitably is its ability to quickly and efficiently deliver products to consumers and retailers. During the year, Electrolux established a new logistics system for warehousing and distribution of products, enabling the company to rapidly and efficiently serve new, transnational distribution channels, such as Home Depot.
To ensure a more streamlined manufacturing process with the latest technology while maintaining high quality, Electrolux is consolidating its North American cooking manufacturing into the state of Tennessee. The company has opened a new cooking plant in Memphis, Tennessee, and is moving cooking production in the unit in L’Assomption, Quebec, Canada, to the new plant. During the year, these facilities were partially operating in parallel, thus leading to increased production costs.
Net sales and operating margin 2013
Priorities moving forward
- Launch of consumer-driven innovation and improvement of product mix
- Growth in new customer segments and new channels
- Continued efforts to cost-efficiently serve new customers
Market demand for 2013 compared to 2012
Electrolux markets and average number of employees 2013
Product highlights
Electrolux French Door refrigerator
The multi-door refrigerators are the fastest growing segment in food preservation. Electrolux strategy is to capture the growth in this segment. Electrolux in North America has developed a modular product range that can be used on a global basis for different customer segments. The brand ambassador for the Electrolux brand is Kelly Ripa, a wellknown TV personality in the US.
Frigidaire new products
During 2013, Electrolux re-launched new products under the Frigidaire brands, such as kitchen appliances with the Smudge-Proof Stainless Steel Range and the 50/50 Symmetry Double Oven.
CEO Statement
In 2013 we continued to deliver above our growth target and delivered 4.5% in organic sales growth.
CEO Statement
I'm convinced that raising product efficiency for the growing middle class is where long-term shareholder value creation lies.
Our products
Electrolux is the only appliance manufacturer in the industry to offer complete solutions for both consumers and professionals. The focus is on innovative and energy-efficient products in the premium segments.
Sustainability
Achieving the Group's vision of sustainability leadership is crucial to realizing the business strategy. The objective is to develop smarter, more accessible, resource-efficient solutions that meet people's needs and improve their lives. Read the comprehensive sustainability performance review.
Awards & recognition
Financial Reporting
Net sales for the Electrolux Group in 2013 amounted to SEK 109,151m, as against SEK 109,994m in the previous year. The organic sales growth was 4.5%, while currencies had an impact of -5.3%.
