ZURICH, Switzerland, May 25, 2005 — ABB, a power and automation technology group, announced its Power Technologies division is to increase the average price of its transformers by up to ten percent immediately, following a sharp increase in raw material prices since the start of 2005.
Over the past year, ABB has experienced costs increases of between 30 and 100 percent for raw materials such as steel, copper and oil, while normal annual cost fluctuations are below ten per cent. These materials are used in the construction of transformers and account for about one third of transformer revenues.
ABB had to increase prices several times in 2004 to offset higher material prices. In the first four months of 2005, however, the price increase for raw material accelerated.
“These additional and unprecedented commodity cost increases are of such magnitude that we have no choice but to pass them on to our end users again,” said Peter Smits, head of the ABB Power Technologies division.
“ABB remains committed to delivering the highest value and product quality to our customers,” said Smits. “Competitive price and quality levels are in the interest of manufacturers as well as users of transformers.”
Transformers are a key component of power transmission and distribution grids. In its Transformers business unit, ABB employs about 12,000 people and achieved revenues of nearly $2.5 billion in 2004. With more than 50 production sites, ABB is the world market leader in transformers.
About ABB [ www.abb.com ]
ABB is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact. The ABB Group of companies operates in around 100 countries and employs about 102,000 people.