ABB's CEO Upbeat on Company's Future

"The economic outlook isvery uncertain, but ABB is well positioned to come out ahead," is how JoeHogan, ABB's CEO concluded his remarks at a press briefing on the first day of ABBAutomation and Power World 2009.

Some 3,000 customers areattending the event this week here in Orlando to attend workshops and trainingsessions, learn about ABB's new product offerings and network with theirpeers.

Given its diversifiedportfolio, which ranges from power products and systems to automation androbotics, the $38B ABB is weathering the economic maelstrom better than some.

Hogan told reporters ABBbegan to see its drives, motors and control products and robotics businesses godown in the second quarter of 2008 and then "get hit pretty hard when therecession hit," due to shorter buying cycles for these products and thedownturn in the automotive industry, which is a heavy user of robotics.

Nonetheless, theSwiss-headquartered automation giant recorded its strongest year ever in 2008,with record orders and revenue. And the company has entered 2009 with momentumfrom a $24B backlog in orders.

Hogan's confidence about thefuture stems from a strict focus on internal factors that the company cancontrol - from operational excellence to staying alert to growth opportunities.The company also is accelerating several initiatives that it hopes will pay offin the future, including improved engineering and product development effortsto reduce costs.

ABB maintains a steadycommitment to R&D, with expenditures in 2009 expected to match 2007 and2008 levels. The company employs 6,000 out of its 120,000-strong work force inR&D, focusing on technologies as diverse as industrial wirelessapplications to the energy grid of the future.

Chief Technology OfficerPeter Terwiesch described several of the key technology areas where ABB isinnovating, such as wind turbine technology. Here, the trend is toward reducedcomplexity in mechanics and higher sophistication in electronics. "It's thesame basic evolution as in automation products," says Terwiesch. That'sknowledge ABB can leverage from its $10.3B automation business.

As for this business, ABB ispushing ahead to develop new technologies that will increase productivitywithout compromising safety, extend the asset life and optimize energyusage. Some of those technologies wereon display in the event's Exhibition Hall, including a new ultra low harmonic driveand a small footprint, low-voltage high-performance ac motor.

Andwhile the economic future may be uncertain, CEO Hogan is certain of one thing:That energy efficiency will play a big role in ABB's future. "Some 65 percent ofelectricity is consumed by industry," he said. "And we certainly can improveupon that."

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