Last year, sales of servosystems (servomotors and drives) in China grew an estimated 26.8% to $362 million, according to a report by IMS Research, Wellingborough, U.K. servosystems account for over 80% of revenues in the Chinese motion-controls market. Sales are expected to grow 20% per year for the next four years, hitting $953 million by 2011. In contrast, sales of stepper motors should grow at a modest 10% over the same period.

The competitive environment is rapidly evolving. The existing market, in which Western, Japanese, and local suppliers seldom compete, is changing due to the recent entry of Taiwanese and Korean companies. And local Chinese suppliers face greater pricing pressure due to relatively low-priced Taiwanese and Korean products.