As we approach Christmas 2024, it’s fair to say that the past year has been a challenging one for the global hydraulics industry. High interest rates, stagflation, and continued global supply chain volatility have strained market dynamics worldwide, with repercussions for businesses operating in the UK. However, amid these challenges, the fluid power sector in the UK is demonstrating a strong commitment to technological innovation and resilience, carefully planning investments and technologies to drive future growth and overcome current challenges.

 

The Weight of Economic Pressures

The fluid power sector is integral to the success of hundreds of businesses in the ‘physical economy’, encompassing construction, agricultural, and manufacturing applications, as well as – increasingly – renewable power, as well. Many hydraulics manufacturers have, therefore, been severely impacted by the economic pressures of the past few years. In particular, high interest rates have increased the cost of borrowing for OEMS and have impacted the ability of end user businesses to invest in new hydraulic technologies and infrastructure.

The sector has also been impacted by elevated inventory levels. As a response to supply chain volatility and disruption, in 2023 many businesses responded by stockpiling materials and components, which this year has led to a slowdown in new orders in some parts of the sector. The current uncertainty about US import traffics and trade barriers is further complicating international supply chains for businesses that operate on both sides of the Atlantic.

The Silver Lining: Technological Advancements

Despite a challenging economic environment, however, the UK hydraulic sector has not stood still. Technological advancements in integrated solutions and electrohydraulics, in particular, are driving the capabilities and potential of a wide range of hydraulic systems. The latest generation of products from Gates, MP Filtri, Webtec and other market leading suppliers are improving the efficiency and performance of hydraulic components while also paving the way for more sustainable and environmentally conscious applications.

Electrohydraulic applications, for instance, combining elements of traditional hydraulic systems with electronic controls, are gaining traction due to their ability to enhance precision and reduce energy consumption. This year, a growing number of UK businesses and OEMs have integrated these systems into existing infrastructure, making operations more environmentally friendly and efficient. Innovations in sensor technology and data monitoring have also improved predictive maintenance for many fluid power systems, reducing downtime and extending the lifespan of individual components.

Opportunities For Growth In 2025

The new Labour government’s focus on growth and infrastructure projects presents a strong opportunity for the fluid power sector. With initiatives aimed at increasing residential and commercial construction across the country, there is the potential for increased demand for advanced hydraulic systems. Also, the ongoing push towards more green technologies aligns perfectly with the industry’s shift towards more energy efficient and sustainable solutions. Many fluid power industry stakeholders are optimistic about the UK’s ability to position itself as a global leader in the hydraulics market in the year ahead.

Despite the hurdles faced by many businesses, there is, therefore, cautious optimism within the UK hydraulic sector as we look towards 2025. While the economic recovery from the pandemic and inflation crisis may be frustratingly slow and gradual, the strategic adoption of new technologies and a focus on sustainability have proven to be successful drivers of growth in adverse conditions. With uncertainty far from over, it is important for industry stakeholders to remain agile, adapting their strategies to evolving market conditions and customer demands.

What Next?

For information about our services and how we can help you strengthen the efficiency, sustainability, and productivity of your hydraulic applications, please contact Hydrastar today by clicking here.

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