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Editor’s note: Businesspeople often shirk when asked to predict the upcoming year. Given the variables both in business and culturally that occur, even the most astute person can have their “predictions” swept aside by outside forces beyond their control.
With that in mind, I’ve asked several top company executives to share with our readers how they see 2014 unfolding. I didn’t ask for a precise prediction, but I did request a sense of their view for the direction of the HVACR industry, and if they wished, their company too.
While the answers vary, I made this simple request. Please share your thoughts with us about the direction, potential and challenges for the HVACR industry in 2014. You have full rein on the focus and breadth (or narrowness) of your reply. You can discuss it from the perspective of your own company or you can explain it from a more theoretical view. The decision is yours.
2014 Will Be A Year to Build On
I’d like to meet the person with 100 percent clarity in their crystal ball. I mean, really. As much as I’d like to say that there’s increased certainty to market conditions here in the U.S. – whether strength or weakness – there’s instead a lot of factors that haven’t yet settled in for the New Year. We step into 2014 with so many unknowns that my crystal ball looks like a newly shaken snow globe.
One of the obvious factors that influences conditions here are the macroeconomic trends. Through this giant swirl of change – including factors that tie closely to the global market – we’re seeing modest gains in both the residential and commercial markets here in North America. In the U.S., things are gradually improving. In Canada, the market is actually trimming back somewhat but is still quite strong.
I just don’t see us returning to those boom years any time soon. Instead, this slow but steady pace is the new normal.
In 2013, we saw strong growth in multifamily construction and the hospitality business. For 2014, we hope and expect to see an increase in single-family home construction, retrofit business and the institutional segment.
There’s also good news in that Washington, D.C. battled through its deadlock with a budget deal in place. With greater stability in D.C., there’s improved confidence in business and consumer markets, which helps drive private sector spending in efficiency upgrades, building systems, retrofits and construction. Building owners and investors who were standing on the sidelines may now be ready to jump back into the market in 2014.
Yet, there are challenges, too. Chief among these are rising costs, including healthcare. With so many unanswered questions, the full impact of the Affordable Healthcare Act still needs to play out. Also, there are increases in material costs, taxes, regulatory mandates, fuel and other inflationary costs that are pulling us in the other direction.
My world here at Taco is tied to all of this – but it’s hard not to be upbeat when we’ve seen so many good things arise from 2013 that favorably affect our lives and the market.
There’s a giant push for greater efficiency within the residential and commercial markets. Commercial owners strive for LEED Gold, and homeowners are investing in systems that will allow them to spend less on fuel for heating and cooling.
There’s the search for greater comfort within living and work spaces at a lower cost. Fortunately, in the wonderful world of hydronics, comfort is not the victim of efficiency.
At Taco, we’re driven to develop and invest in new technologies that improve operational efficiency at every level – through our high efficiency ECM Viridian and Bumble Bee pumps, our SelfSensing ProBalance pumps with integrated variable speed drives and Taco’s iWorx web-capable building management platform that puts total HVAC building control into one advanced yet easy-to-install package.
Today, all manufacturers in the industry are faced with the need to make hefty investments just to keep pace with the increasingly escalating rate of technology. Hopefully, the rate of adoption of these new technologies by the market will allow manufacturers to see a return on their R&D investments so they and the industry can remain financially secure.
There’s a human side to the equation that’s very rewarding for me, personally. Our 500+ employees are my family, and they’re the ones who are the very root of our existence.
For things to look good at Taco, they must also look good for my employees and staff. As a responsible corporation, Taco must provide them with good benefits, a good standard of living and stability. We’re constantly asking them how we can help them here on the job and at home. An engaged and happy employee is one who lives and breathes our mantra of quality across the board, and because of this, we can react faster when there are changes in the market. Our employees allow us to remain competitive in a global marketplace while engaging in our local communities to make them stronger, too.
Another facet of our strength is our training. More people are taking advantage of the technical support provided by our FloPro University (residential) and Taco University (commercial). We see this trend increasing as it also ties to our value-added contributions.
There’s the impact of the support we offer to design and control complete hydronic commercial systems. We call it total project support – availing a team of people who work with customers so they can achieve the system performance they’re looking for.
A challenge we see are new multinational entrants into the North American HVAC market, touting technology with new delivery methods. A question I have: Are these systems delivering as promised? We believe that if a building owner is really looking for comfort, efficiency and life cycle cost advantage, hydronics is still the way to go. Through education and design support, we can show them the way.
As you can see, Taco isn’t just a manufacturer of products. Our role and responsibilities are far more than that. We learned long ago the importance of substantive involvement in our markets at many different levels.
System design expertise and engineering, steadily nurtured relationships with wholesalers and system installers and outreach among consulting-specifying engineers, building owners and local communities: It’s all part of what we do, every day. And this plays a very important role in our ability to positively influence our own destiny and the HVAC industry in 2014.
John Hazen White, Jr. is president of Taco. Visit www.taco-hvac.com.
Tom Peric´ is the editor of HVACR/Hydronics Distribution Business. Contact him at 856/874-0049 or firstname.lastname@example.org.