Positive Start to 2010 for Italy’s MDA Market - Further Boosted by Incentive Scheme

The Italian MDA market has experienced market increases in terms of both volume (+8.0%) and value (+11.4%) in April 2010 compared to 2009. This period has been characterised by a new wave of government incentives which came into operation on April 15th, 2010. The Italian Government fixed a special incentive plan for 2010 totaling 300 million euros, with the intention of boosting sales in different sectors; eco-efficient houses, outboard engines, tractors, motorcycles, kitchens and household appliances.

Incentives worth 60 million euros were allocated for kitchens and the discount is up to 10% of the list prices (max 1,000 euro per kitchen). To qualify for incentives, kitchens must include at least two high energy efficiency appliances and for the discounts, appliances must respect the norms on formaldehyde emission and be ready for waste-sorting. They will also have to replace old appliances.

For high energy efficient single appliances, the total amount is fixed at 50 million euro and the discount for customers is up to a maximum of 20% of the list price.

The appliances involved in the incentive plan are as follows:

In April 2010, the direct effect of the incentives is clearly identifiable and the most important achievements have occurred in Dishwashers and the built-in Cooking product groups, as a consequence of both direct and indirect incentives for kitchens.

The most immediate effect is that the importance of every single product within the MDA sector has changed. Dishwashers' market share in April climbed from 15.4% in 2009 to represent 18.2%. It is also significant to note that in the first four months of 2010 (compared to 2009) Washing Machines (+7%), Cooling (+3%) and Hobs (+3%) all registered positive growth in value terms.   

So are the changes in market consumption down solely to the government incentives? It seems clear that they have certainly contributed, but other factors have also played their part. Once again the Washing market recorded very positive trends. This was partly due to the government contribution to consumption but also down to innovations and the ability of the market itself (manufacturers + retailers) to create the desire for change. These innovations have led to a huge improvement in the first four months of 2010.