IVT’s focus on efficiency
Heat pumps are an effective way of providing significant energy reductions in the modern home, and today more than 80 per cent of new houses built in Sweden have one installed.
As Europe’s leading manufacturer of heat pumps, IVT has over 30 years experience in developing innovative, energy-saving solutions suitable for all types of houses and apartment buildings.
In recent years, IVT has experienced considerable expansion, as Johnny Wärnelõv, managing director at the business explains: “We have had very strong, very profitable growth for around ten years now. In 1995 we had an annual turnover of around three million euros, whilst today it is around 160 million euros. During the early 1990s the Swedish government started initiatives to save energy in the country, including a competition to develop innovative heat pumps. We won this competition, and were awarded government help to develop and promote heat pump solutions, which enabled us to dominate the market.”
Johnny believes that the company’s acquisition by the Bosch Group was a further contributor to its success: “The business was sold to Bosch in 2004, and this has changed us considerably, particularly by expanding our connections throughout Europe. For example, Bosch has a large brand name in the UK manufacturing gas and oil burners, and through this brand we can strengthen our position in the UK considerably. Additionally, Bosch has excellent competencies in production and development processes, which has led us to implement many changes in this area.”
The company also has developed its own distribution and logistics network in Sweden: “Throughout Sweden and Scandinavia we have developed a very strong distribution network, which is how we managed to take charge of the market in the early 1990s,” says Johnny. “We built up our own IVT centres and shops, whilst our competitors predominantly worked with wholesalers. Through having our own distribution network we were able to demonstrate our competence, and gain a 40 per cent market share in Sweden.”
The current focus on improving energy saving methods throughout the home means that IVT places the highest emphasis on R&D: “In the late 1990s we decided to focus heavily on design, and today it is one of the key factors in the success of our business,” Johnny explains. “We are very proud of our product range, and we believe that we have many market leading, innovative heat pump designs that are particularly environmentally friendly.
“Our development programme is very active at the moment, with around 170 different applications,” he continues. “A development that we are particularly proud of is our IVT ground heat pumps, which heat homes from a number of natural heat sources. In this process we drill up to 150 metres below ground to use the stored solar energy in the soil to heat fluid in the heat pump, which in turn heats the home. The system can also be used for cooling purposes by installing fans in the hole. This concept has been very successful in Sweden and Holland, and we are working on developments for other countries in Europe.”
The company’s considerable growth in recent years means that it has had to improve its manufacturing processes: “Efficiency throughout our production facilities is extremely important, and we now employ an entirely different way of thinking in our production and logistics,” Johnny comments. “We are currently in the middle of implementing the Bosch Production System (BPS), together with totally rebuilding our manufacturing plant, which will be ready by August 2007. These improvements will raise our production levels from 30,000 heat pumps to around 80,000.”
Johnny explains that the recognised benefits of heat pumps have led to a buoyant market situation: “The industry is very strong at the moment, with excellent opportunities for growth. We have a very strong performance in terms of production, and when we become even more efficient it will enable us to be increasingly competitive in the market. At present I can see there being a very buoyant situation for the next four to five years. Heat pumps are very popular across Europe, and our home market is very strong.
“The main challenge for us is to understand how to operate as a larger company,” he continues. “Ten years ago we only had a turnover of around three million euros, whereas now it is around 160 million euros, so we need to develop strategies to cope with this growth in the most effective manner. Bosch has added a lot of new processes to our inventory, so we have to ensure that remain the leader in heat pump developments.”
Despite these challenges, Johnny hopes the company can continue to grow: “We have annual growth targets of 25 per cent for the coming years. The total market for heat pumps is continuing to grow, so we must evolve with it. We aim to grow faster than the market so that we can continue to gain business. We are a forward looking business, and with the Bosch brand behind us we are confident that we can achieve our goals,” he concludes.
Products: Heat pumps