Procurement Market Intelligence Report
Gas Turbines
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Gas Turbines Global Overview
Definition
Summary
Gas turbines are a type of internal combustion engine where atmospheric air is compressed and then ignited using fuel to produce high-pressure gas that creates rotational pressure on turbine blades. This pressure is then converted into electrical energy with a generator for power generation applications. Gas turbines also power machinery such as aircraft and oil and gas equipment. In these applications, the mechanical energy from gas turbines produces horsepower or thrust. Suppliers include manufacturers, and major buyers include energy companies, commercial building developers, commercial airline operators and the military.
This Report Includes:
- Gas Turbine Manufacturing
- Gas Turbine Power Generation
Not in this Report:
- Electric Motors
- Other Types of Internal Combustion Engine
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Global Gas Turbines Procurement Trends
Discover the top international trends affecting procurement in the global Gas Turbines market.
Warning Trends
Public sector demand slumps as the government enters shutdown
- On October 1, the US federal government entered a shutdown after negotiations for a new appropriations bill failed.
- During a government shutdown, essential federal government operations, such as law enforcement, air-traffic control, and social security, persist, while nonessential operations are paused and workers involved in these operations are furloughed. Thus, the current shutdown is expected to result in 750,000 federal workers being furloughed, representing a $400 million reduction in daily expenditure by the federal government.
- This significant reduction in federal spending and operations will affect the entire US economy, weakening aggregate demand and slowing economic growth. For example, the 35-day government shutdown in Q1, 2019, reduced aggregate demand in both the public and private sectors, resulting in a 0.2% reduction in GDP growth that quarter.
- The effects of the shutdown are likely to be most acute in markets where the public sector is a major buyer segment, weakening demand and increasing average vendor risk by destabilizing important revenue streams.
- As negotiations for a new appropriations bill to reopen the government remain ongoing, ProcurementIQ will continue to monitor the situation and update this story with the latest information.
Tariffs may drive up prices and lead times for electrical equipment
- The Trump administration’s reciprocal tariffs, which raise the tariffs on all goods imported from most other countries, are set to take effect on August 7 after the rates were finalized on August 1. The US power generation and distribution sector is highly reliant on imports, with electrical equipment imports accounting for an estimated 56.7% of total annual domestic supply.
- Due to the complexity of most power generation and distribution machinery, most components or raw materials included in these products originate outside the United States, even if the finished machinery is assembled domestically.
- As a result, the Yale Budget Lab currently estimates that the upcoming tariffs will cause electrical equipment prices to increase by 26.6% on average.
- Further, tariffs present complications for the long, often multinational production cycles common for more complex electrical equipment manufacturing, leading American Electric Power and other leaders in the energy sector to warn of shortages and increased lead times for electric equipment.
United States announces new tariffs on all imported steel
- In February 2025, the United States announced 25.0% tariffs on all imported steel with no exemptions or exceptions. The tariffs took effect on March 12, 2025. On June 4th, these tariffs were increased further to 50%. These tariffs were not impacted by a recent court decision that temporarily suspended duties on certain goods as they were implemented under Section 232 of the Trade Expansion Act.
- Previously, countries such as Canada, Mexico, and Brazil, the top exporters of steel to the United States, had exemptions from tariffs. These have now been removed and all imported steel, regardless of origin, will be subject to the 50.0% tariff. However, on May 8th, the US announced an agreement with the United Kingdom to remove all levies on steel exported from the UK.
- When tariffs on steel imports were introduced in March 2018, they contributed to an increase in the price of steel and steel products. According to the Bureau of Labor Statistics, the price of steel-milled products increased by 10.2% in the year after the tariffs were implemented. This market heavily relies on steel as an input and may be impacted by this policy.
Global Gas Turbines Market - Suppliers by Region
| Country/Region | Number of Suppliers |
|---|---|
| #1 China | 580 |
| #2 Europe | 555 |
| #3 United States | 210 |
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Geography Drilldown - US
Average Cost of Gas Turbines
United States
2026 Market Pricing$1,000.00 to $XX,XXX,XXX.XX
per unitAverage Price
Prices in the Gas Turbines market range from $1,000.00 to $XX,XXX,XXX.XX, depending on Type and Application, Design, Power and Cycle Type. For example, lower prices are associated with Small building standby power ($1,000 to $100,000 per unit), whereas higher prices are associated with Aircraft turbines ($200,000 to $2 million per unit) and Large power-generation facilities ($1 million to $50 million per unit).
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Gas Turbines Category Price Trends
Pricing trends are indicated by the compound annual growth rate (CAGR) during a set period of time. For the Gas Turbines market, prices in the US have grown 2.7% from 2022 to 2025. Subscribers can access price trend forecasts, price driver projections and forward-looking cost structure data. Learn more
United States (2022-2025)
United States (2025-2028)
Compound Annual Growth Rate
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Cost Analysis - Total Cost of Ownership for Gas Turbines
Total cost of ownership is Medium in the Gas Turbines market. The average cost of ownership differs depending on the contract but generally includes costs negotiated before the contract begins, costs billed during the contract period and unforeseen costs. For example, unforeseen costs in the form of Delays may raise the total cost of ownership unexpectedly.
Negotiated Before
Pre-evaluation
Billed During
Fuel
Maintenance
Unforeseen
Delays
Buyer Power in Procurement Negotiations
In 2026, buyer power amounts to -3.4 in the United States. Buyer power is most positively impacted by Recent Developments. It is most negatively impacted by Switching Costs. Subscribers can access details on eight other factors that impact buyer power. Learn more
United States
Buyer power forecasts: your glimpse into the future
Develop strategies for the upcoming year and identify unforeseen opportunities for buying now
- Actionable "Buy Now" and "Buy Later" insights
- Near-real-time updates to current and forecast Buyer Power Scores
- Methodology and weightings for Buyer Power Score Components
Supply Chain Risk
The average level of supply chain risk is assessed as Medium, which has a negative impact on buyer power. The level of supply chain risk is affected by industry volatility, barriers to entry, competition, import penetration, regulation and industry financial risk. Buyers in this market can mitigate procurement and supply chain management risks by monitoring risk levels for individual first and second tier suppliers:
1st
Tier Suppliers
- Iron & Steel Manufacturers
- Nonferrous Metal Foundry Products Manufacturers
- Fabricated Plastic Product Manufacturers
2nd
Tier Suppliers
- Iron Ore Miners
- Aluminum Manufacturers
- Plastic & Resin Manufacturers
Biggest Gas Turbines Suppliers in the US by Revenue
The largest Gas Turbines vendors by revenue in the US are Rolls-Royce PLC, Raytheon Technologies Corporation and Abb Ltd. Subscribers can sort and filter by market share concentration, profit level and other factors. Learn more
| Supplier | Operational Size | Headquarters | Number of Employees | Market Share (%) | Market Share Performance (3yr trend) | Total Revenue ($ million) | Profit Level (%) | Risk Level |
|---|---|---|---|---|---|---|---|---|
| Caterpillar Inc. | Global | IRVING, IL | >10,000 | 10-15 | ||||
| Cummins Inc. | Global | COLUMBUS, IN | >10,000 | 10-15 | ||||
| General Electric Company | Global | EVENDALE | >10,000 | 25+ | ||||
| Siemens Ag | Global | Munich , DE | >10,001 | 5-10 | ||||
| Honeywell International Inc. | Global | CHARLOTTE | >10,000 | 5-10 | ||||
| Abb Ltd | Global | Zurich | >10,000 | 5-10 | ||||
| Raytheon Technologies Corporation | Global | WALTHAM, MA | >10,000 | 5-10 | ||||
| Mitsubishi Heavy Industries Ltd. | Global | Tokyo, JP | >10,001 | < 5 | ||||
| Rolls-Royce PLC | Global | London, UK | >10,001 | < 5 | ||||
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Profit Analysis
The average profit margin across vendors in the Gas Turbines market is 4.3% and steady. Profit levels shift depending on suppliers' spend on wages, purchases and overhead. The highest cost component for vendors is Overhead. The cost trend for this component is falling, when considering movement between 2025 and 2026. To understand cost forecasts for 2027 and uncover the implications on profit, start your subscription. Learn more
Vendor & Supply Chain Analysis
The average financial risk among suppliers is moderate but can vary depending on different factors. In general, larger suppliers that have a broader portfolio of products and services and that serve a more comprehensive range of industries have lower financial risk while smaller suppliers are more susceptible to revenue volatility because a drop in demand from one or more key customers would be relatively detrimental to their business.
The moderate level of specialization in this market acts as a barrier to entry for prospective suppliers, thereby supporting high market share concentration. High market share concentration hurts buyer power by limiting the pool of available suppliers, thus giving buyers less leverage in the negotiation process.
The gas turbine market has a medium level of supply chain risk, which stems primarily from suppliers’ reliance on steel, aluminum, titanium and other metals and metal alloys. Volatile input costs increase uncertainty in suppliers’ production costs, leading to unstable pricing trends for buyers of gas turbines.
The United States is a net exporter of gas turbines, meaning it exports more gas turbines than it imports. This fact often means that US buyers have access to a wide range of domestic manufacturers, allowing them to focus procurement strategies on negotiating better terms and prices, while also reducing complexities and logistics costs associated with international trade.
Supplier Information
Caterpillar Inc.
Caterpillar Inc. is a public company operating globally in the manufacturing, manufacturing, manufacturing, wholesale trade, real estate and rental and leasing and other services (except public administration) sectors. The company's offerings include antifreeze, drilling & exploration equipment, drilling Subscribe to learn more
Cummins Inc.
Cummins Inc. is a public company operating globally in the manufacturing, manufacturing, administration, business support and waste management services and other services (except public administration) sectors. The company's offerings include diesel exhaust fluid (def), catalytic converters, once-through Subscribe to learn more
General Electric Company
General Electric Company (dba GE Aerospace) is a global aerospace company that provides engines, systems, and services to commercial, government, and military markets. It organizes its business into two segments: the Commercial Engines & Services segment, which designs and manufactures jet engines for commercial... Subscribe to learn more
Abb Ltd
ABB Ltd. is a global technology company that offers comprehensive electrification, robotics, automation, and motion solutions, primarily serving the distribution utilities, renewables, and transport & infrastructure markets. It organizes its business into four segments: the Electrification segment, which Subscribe to learn more
Honeywell International Inc.
Honeywell International Inc. is a global technology and manufacturing company that designs, develops, produces, and markets consumer and industrial products. It organizes its business into four reportable business segments: the Aerospace segment, which supplies products, software, and services for aircraft;... Subscribe to learn more
Raytheon Technologies Corporation
Raytheon Technologies Corporation is a public company operating globally in the construction, manufacturing, information, professional, scientific and technical services and other services (except public administration) sectors. The company's offerings include gas turbines, dampers, strobe & warning lights,... Subscribe to learn more
Siemens Ag
Siemens Ag is a public company operating globally in the manufacturing, information, real estate & rental & leasing, professional, scientific & technical services, administration, business support and waste management services and other services (except public administration) sectors. The company's offerings... Subscribe to learn more
Mitsubishi Heavy Industries Ltd.
Mitsubishi Heavy Industries Ltd. is a public company operating globally in the manufacturing and other services (except public administration) sectors. The company's offerings include motor graders, injection molding machines, forklifts, tow tractors, hydraulic turbines. Founded in 1950, the company is currently... Subscribe to learn more
Navistar International Corp
Navistar International Corporation is a holding company that designs, manufactures, and markets trucks and buses, parts, and services in Class 6 through Class 8 vehicle segments. It offers Class 4 through 8 trucks and buses in the common carrier, private carrier, government, leasing, construction, energy/petroleum,... Subscribe to learn more
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Procurement Management KPIs for the Gas Turbines Market
Managing vendor performance throughout the contract period is easier when tracking specific key performance indicators (KPIs). For example, buyers should monitor Average Order Value and Current Ratio (Assets/Liabilities). Buyers may experience better performance throughout their contracts if they establish service level agreements (SLAs) based on Accuracy and other factors.
| KPI | Level of Importance (1-5) | Measurements | Key Considerations |
|---|---|---|---|
| Average Order Value |
|
Total revenue Number of orders |
The average order value in the gas turbine market indicates the typical investment made by buyers, which often includes the cost of the turbine, associated equipment, and installation services. This KPI can help buyers compare the pricing strategies of different suppliers and evaluate their willingness to pay for a specific gas turbine solution, considering factors such as efficiency, power output, and technological advances. The average order value can be used to evaluate a company’s reputation. The average order value can be used to assess a company’s ability to provide large volumes of product. |
| Current Ratio (Assets/Liabilities) |
|
Current assets Current liabilities |
The current ratio in the gas turbine market reflects a supplier's financial stability and capability to meet short-term financial obligations, which is essential for buyers addressing project risks and securing reliable partnerships. The current ratio can be used to determine a company’s ability to pay its short-term obligations. A supplier's current ratio can be analyzed to determine their ability to utilize their current assets to satisfy potential claims or support requirements, such as warranty coverage or maintenance services, on gas turbine projects. |
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Questions to Ask During Procurement Negotiations
How can I gain leverage during negotiations?
Quality Control
How many recalls have you had?
What types of technical issues have you experienced with this product?
Supply Chain Risk
How do you manage risk in your supply chain?
Who are your most important suppliers and how long have you been in business with them?
Vendor Financial Risk
What is your company's sales history for the past five years?
Has your company ever been at risk of bankruptcy?
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Gas Turbines RFP Guidelines
What should my RFP include?
Organizational Overview
Buyers should describe their operations (i.e., transportation, energy, defense, etc.), to help vendors get an idea of their general turbine needs and operating environment.
Buyers should provide a detailed description of their operational structure, including to whom vendors will report.
Statement Of Need
Buyers should identify performance metrics they desire for their gas turbine, such as power output and heat rate.
Buyers should provide a detailed description of any other systems or components that will be connected to the gas turbine (e.g., heat recovery steam generator).
Project Budget
Buyers should explicitly state the amount for the award.
Buyers should explain their desired payment schedule.
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Our Reports include:
- Opportunity assessment
- Market dynamics
- Recent developments
- Positive and warning trends
- Buyer power levers
- Price environment and market pricing
- Geographic wage rates
- Global market updates
- Total cost of ownership
- Cost structure benchmarks and analysis
- Supply chain and vendors
- Global supplier breakdown
- Market share concentration
- Regulation and business requirements
- Vendor management and KPIs
- Sourcing strategy guidance
