Nidec CEO on Tariffs, the Integral Horsepower Rule and More

Henk van Duijnhoven, Nidec Motor Corporation CEO, weighs in on what he expects to see for motors and drives and the pump industry this year. Read more State of the Industry coverage by clicking here. How are international politics affecting the pump industry? The largest impact from international politics is on tariffs. The scope of products and components as well as the rates applied are both growing. We then have to evaluate where on the globe our products are manufactured and components are sourced. Fortunately, we have a global supply base and are able to move to the locations that will best serve our customers. This still takes time to accomplish. How is your company addressing the skills gap with training, internships and/or reaching out to the next generation of professionals to attract new employees? As our company continues to grow we are adding positions in manufacturing, engineering, sales and marketing, finance and many other functional areas. We also have a robust internship program, which provides opportunities for college students to work in our manufacturing and office facilities. This allows the intern to gain experience in their chosen field and learn more about the company. It also gives the company insight to determine if the intern might be a good fit for a position after graduation. We are also highly engaged in a number of STEM-related outreach activities, and collaborate regularly with high schools, technical colleges and universities. To attract new people we participate in college and university career fairs, community networking, and recruit through online platforms such as LinkedIn and Indeed. Companies need to embrace social media platforms and make sure their messages appeal to those early in their careers. This is how many new entrants to the workforce communicate. What is the next thing to look out for in motors and drives? We will start to see motors and drives become integrated systems rather than as two components bought separately. The integrated solution offers lower operating cost, improves system efficiency and places the responsibility of performance on one manufacturer instead of potentially two. How has the Integral Horsepower Rule affected the industry? The rule basically closes the loophole on many "specialty" type products that were not covered under EISA. Now, most integral product will have to meet NEMA Premium standards. This should not have a large impact on the industry as the technological burden to make products compliant is not excessive. However, compliance with the rule will require products to be designed with more material content in most cases and this will have an impact on cost and price. As a result of the move to virtually all NEMA Premium products, the manufacturing processes and materials have transitioned to be optimized around premium levels. The more that South America and Africa catch up to North America for motor efficiency standards, the better. New rules for efficiency in applications will progressively force the use of variable speed in many industry segments, in particular for pumps. What is the biggest issue the industry will face in 2019? The biggest issue for the industry are the tariffs. The scope of products and components as well as the rates applied are both growing. We have to evaluate where on the globe our products are manufactured and components are sourced. Fortunately, we have a global supply base and are able to move to the locations that will best serve our customers. This still takes time to accomplish.