LONDON, July 18, 2013 /PRNewswire/ -- The strong inflow of foreign investments and European Union funds to various industries in Central and Eastern Europe is fuelling the installation of uninterruptible power supply (UPS) systems in the region. As the market is highly price-sensitive, stabilisation and a subsequent decline in UPS prices will occur during the next three years.

New analysis from Frost & Sullivan (http://www.powersupplies.frost.com), Central and Eastern European Uninterruptible Power Supply (UPS) Market, finds that the market earned revenues of $255 million in 2012 and estimates this to reach $313.5 million in 2017. End-user segments covered in this study include the data centres, healthcare, commercial, industrial and public infrastructure.

With a substantial portion of the total EU funding for the region being used to co-finance large public infrastructure and environmental end-user projects, the scope of the CEE UPS market has widened. The rising popularity of air travel has resulted in the expansion of existing airports and the building of new ones, further encouraging uptake. The need for higher investments in the IT sector adds to UPS sales.

On the other hand, the market is plagued by competitive pricing pressures which limit the margins of most UPS manufacturers. Local and Asian manufacturers promising low prices but compromising on quality, combined with the hike in the prices of commodity products such as copper, also affect revenues.

"To combat these challenges and maintain their stronghold, established UPS companies employ two key strategies," said Frost & Sullivan Energy and Environmental Industry Analyst Gautham Gnanajothi. "One includes incorporating hi-tech features in their products to eliminate competition from low-cost manufacturers."

In fact, the UPS industry is moving towards creating highly efficient, lightweight, and smaller UPS solutions, especially as end users increasingly favour systems with maximum power and minimum footprint. This has paved the way for the growth of transformerless UPS technologies. The adoption of transformerless UPS in Europe has gone up in recent years, and is particularly robust in Western European countries.

The demand for small power range UPS for personal computers, servers, and IT equipment in offices and buildings is also high across Europe, although the trend is stronger in the CEE region. Modular UPS technologies, currently in the early stages of growth, are expected to become popular as well, with the potential to evolve to freestanding UPS systems in the future.

"Another strategy used by key UPS vendors to stay competitive includes cutting down their direct presence abroad and partnering with other distribution channels," noted Gnanajothi. "This saves on both capital and operational expense as the setting up of offices and service centres would not be necessary, hence giving a boost to their profitability."