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General Electric Loses Spark Despite Topping Latest Brand Ranking

  • General Electric’s brand value drops but retains position as world’s most valuable engineering & construction brand, brand value US$28.3 billion
  • US brands dominate Brand Finance Engineering & Construction 2019 ranking: 19 brands claim spots in top 50
  • Chinese brands defy economic slowdown as majority record healthy brand value growth, averaging 14% brand value increase
  • Siemens is sector’s strongest, Brand Strength Index (BSI) score 84.0 out of 100 and AAA- brand strength rating

View the full Brand Finance Engineering & Construction 50 2019 report here

GE losing its spark at top

General Electric has retained its position as the world’s most valuable engineering and construction brand, despite its brand value falling 12% to US$28.3 billion, according the newly expanded Brand Finance Engineering & Construction ranking.

The brand’s sheer power and dominance in the industry has not shielded it from major obstacles and last year proved one of the most challenging for the brand over its 127-year history. General Electric lost nearly US$90 million of its market value, largely attributable to the underperforming power strand of the business, it faced a US$6.2 billion insurance charge that was not accounted for and was removed from the Dow Jones Industrial Average (DJIA). The dismissal of CEO John Flannery after little more than a year encapsulated these challenges. These factors, pared with the difficulties surrounding the oil price crash, and the brand’s mountainous debt pile, mean GE is slowly losing its stronghold in the sector.

US brands dominate ranking

US brands claim an impressive 19 spots in the top 50, and apart from first ranked General Electric and D. R. Horton (brand value down 3% to US$3.3 billion), all brands have recorded flat or positive brand value growth, a reflection of the expansion of the US engineering and construction industry.

The world’s largest machinery brand, Caterpillar, has jumped three places in the ranking to 12th position after increasing its brand value by a significant 45% (brand value US$7.6 billion), simultaneously claiming the title as the fastest-growing brand in the sector. Last year, Caterpillar celebrated record profit per share and a 20% increase in both sales and revenue following several years of sales stagnation amid the oil price collapse. The brand’s commitment to developing differentiated products and spearheading digital and technology solutions demonstrate Caterpillar’s strong innovation strategy, a key driver behind its immense brand value growth.

Fellow Illinois-based brand, John Deere, has boosted its brand value by 39% to US$6.4 billion. The 180-year-old brand has been making strides towards greater innovation in its operations, acquiring Blue River Technology in late 2017, and opening a new artificial intelligence lab in Silicon Valley. With greater challenges facing agriculture businesses in the face of an ever-rising population, these moves are a clear signal of the brand’s commitment to sustainable farming and food production.

David Haigh, CEO of Brand Finance commented:

“Engineering and construction brands are slowly beginning to grasp the importance of innovation and digitalisation. We are in the midst of Industry 4.0 and on the cusp of a new era which demands that traditional brands in the sector evolve to embrace this change. Brands which move fast to engage and adapt will be the high achievers in next year’s rankings.”

Belt and Road boosting Chinese brands

Chinese brands are the second most represented in the table, with 9 included in the ranking, 4 of these attaining top 10 positions: China State Construction Engineering Corporation (CSCEC – down 3% to US$25.7 billion); China Railway Construction Corporation (CRCC – up 24% to US$15.2 billion); China Railway Engineering Corporation (CRECG – up 14% to US$11.7 billion); and CRRC (up 20% to US$8.0 billion).

President Xi Jinping’s Belt and Road Initiative, launched in 2013, has been the main impetus for Chinese brands performing strongly and making significant inroads across the sector. Railway giants CRCC, CRECG and CRRC have all won major, extremely high value, contracts globally, growing their footprint substantially through entering new markets in Africa, Europe and North America. Their ability to outshine their main competitors is boosted by the government’s backing of the sector, named a priority in the ‘Made in China 2025’ plan. As the railway sector thrives, these brands will no doubt solidify their positions as world leaders in the wider engineering and construction sector too.

Another notable Chinese brand is China National Building Material (CNBM) which is the second fastest growing brand in the rankings, its brand value increasing an impressive 39% to US$4.9 billion. Last year, CNBM merged with its rival China National Materials (Sinoma) forming the world’s largest cement maker and cement plant builder.

Siemens sector’s strongest

In addition to measuring overall brand value, Brand Finance also evaluates the relative strength of brands, based on factors such as marketing investment, familiarity, loyalty, staff satisfaction, and corporate reputation. Alongside revenue forecasts, brand strength is a crucial driver of brand value. According to these criteria, Siemens is the world’s strongest engineering and construction brand with a Brand Strength Index (BSI) score of 84.0 out of 100 and a corresponding AAA- brand strength rating.

Siemens prides itself on being a leader in the industry for digital transformation, through investing US$1 billion annually on research and development, acquiring a number of digital companies including Mendix last year, and by widening its footprint within the AI sphere. This commitment stands the brand in good stead to thrive against competitors in the Industry 4.0 era.

Although Siemens has claimed the title as the sector’s strongest brand, its brand value has suffered, falling 2% to US$21.6 billion, resulting in the brand dropping out of the top 3, pushed out by fellow German brand Bosch (up 19% to US$22.9 billion). Siemen’s profitability and revenue has steadily been declining year on year as the demand for power plant equipment, a significant part of the brand’s business, is dropping. Siemens has recently announced it is cutting 2,700 jobs globally as part of its cost cutting measures.  In contrast, Bosch has celebrated record high sales in 2018.


Note to Editors

Every year, Brand Finance values 5,000 of the world’s biggest brands. The 50 most valuable engineering and construction brands are included in the Brand Finance Engineering & Construction 50 2019 ranking.

Brand value is understood as the net economic benefit that a brand owner would achieve by licensing the brand in the open market. Brand strength is the efficacy of a brand’s performance on intangible measures relative to its competitors.

Additional insights, charts, and more information about the methodology, as well as definitions of key terms are available in the Brand Finance Engineering & Construction 50 2019 report.  

Data compiled for the Brand Finance rankings and reports are provided for the benefit of the media and are not to be used for any commercial or technical purpose without written permission from Brand Finance.

Media Contacts

Sehr Sarwar
Communications Director, Brand Finance
T: +44 (0)2073 899 400
M: +44 (0)7966 963 669

Florina Cormack-Loyd
Communications Manager, Brand Finance
T: +44 (0)2073 899 400
M: +44 (0)7939 118 932

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About Brand Finance          

Brand Finance is the world’s leading independent brand valuation consultancy, with offices in over 20 countries. Brand Finance bridges the gap between marketing and finance by quantifying the financial value of brands.

Brand Finance helped craft the internationally recognised standard on Brand Valuation – ISO 10668, and the recently approved standard on Brand Evaluation – ISO 20671.

Brand Finance is a chartered accountancy firm regulated by the Institute of Chartered Accountants in England and Wales (ICAEW), and also the first brand valuation consultancy to join the International Valuation Standards Council (IVSC).

Brand Finance’s brand value rankings have been certified by the Marketing Accountability Standards Board (MASB) through the Marketing Metric Audit Protocol (MMAP), the formal process for validating the relationship between marketing measurement and financial performance.


Definition of Brand

Brand Finance helped to craft the internationally recognised standard on Brand Valuation – ISO 10668. It defines a brand as a marketing-related intangible asset including, but not limited to, names, terms, signs, symbols, logos, and designs, intended to identify goods, services or entities, creating distinctive images and associations in the minds of stakeholders, thereby generating economic benefits.

Brand Strength

Brand strength is the efficacy of a brand’s performance on intangible measures, relative to its competitors. In order to determine the strength of a brand, we look at Marketing Investment, Stakeholder Equity, and the impact of those on Business Performance.

Each brand is assigned a Brand Strength Index (BSI) score out of 100, which feeds into the brand value calculation. Based on the score, each brand is assigned a corresponding rating up to AAA+ in a format similar to a credit rating.

Brand Valuation Approach

Brand Finance calculates the values of the brands in its league tables using the Royalty Relief approach – a brand valuation method compliant with the industry standards set in ISO 10668. It involves estimating the likely future revenues that are attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a ‘brand value’ understood as a net economic benefit that a brand owner would achieve by licensing the brand in the open market.

The steps in this process are as follows:

1 Calculate brand strength using a balanced scorecard of metrics assessing Marketing Investment, Stakeholder Equity and Business Performance. Brand strength is expressed as a Brand Strength Index (BSI) score on a scale of 0 to 100.

2 Determine royalty range for each industry, reflecting the importance of brand to purchasing decisions. In luxury, the maximum percentage is high, in extractive industry, where goods are often commoditised, it is lower. This is done by reviewing comparable licensing agreements sourced from Brand Finance’s extensive database.

3 Calculate royalty rate. The BSI score is applied to the royalty range to arrive at a royalty rate. For example, if the royalty range in a sector is 0-5% and a brand has a BSI score of 80 out of 100, then an appropriate royalty rate for the use of this brand in the given sector will be 4%.

4 Determine brand-specific revenues by estimating a proportion of parent company revenues attributable to a brand.

5 Determine forecast revenues using a function of historic revenues, equity analyst forecasts, and economic growth rates.

6 Apply the royalty rate to the forecast revenues to derive brand revenues.

7 Brand revenues are discounted post-tax to a net present value which equals the brand value.


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