Encoders are witnessing robust demand in the global automotive and electronics industries and this is pushing revenues in the global encoder market. This burgeoning demand is primarily responsible for reduction in prices of encoders, and according to a new research study published by Future Market Insights (FMI), price optimisation is expected to benefit overall growth of the global encoder market. FMI further projects accelerated demand for encoders in the wake of rapid advancements in industrial activities and expansion of the global infrastructure sector – generating a high demand for automation equipment.
According to forecasts presented in the report, global revenue from the sales of encoders is estimated to stand at US$ 2,189.1 Mn by the end of 2018. The global encoder market is expected to register a CAGR of 12.3% during the period 2018 to 2027. FMI’s report tracks the demand scenario of linear and rotary encoders and also studies the adoption of encoders across key industries including automotive, electronics, and textile & printing machinery.
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Key Dynamics Impacting Growth in Sales of Encoders, According to FMI
FMI dives deep into the key factors expected to influence revenue growth of the global encoder market. One of the main drivers of the market is rising vehicle electrification in both hybrid as well as electric vehicles. Automakers are integrating Bluetooth and other cellular technologies in their vehicles to cater to an increasing consumer demand to stay connected while on the move. These advanced vehicle features require sensors and semiconductors for distributing and controlling power within the vehicle. This is boosting growth in revenue of the global encoder market. Further, growing incorporation of in-vehicle safety measures such as automatic emergency braking (AEB) especially in the case of autonomous vehicles is further likely to power up sales of encoders in the coming years.
Another critical factor positively impacting revenue growth of the global encoder market is rapidly increasing automobile automation. Vehicle automation is evolving swiftly by the day to enhance the customer driving experience. New-age automobiles incorporate technologies such as speech recognition, IC-integrated LED lighting, as well as video and image compatibilities. Encoders play an important role in automobile automation and are being increasingly used by automakers in vehicle manufacturing. This is likely to push revenues in the global encoder market.
“Rising governmental initiatives promoting the manufacturing sector across the globe is an important revenue driver of the encoder market. Governments are showing a keen interest in manufacturing activities and are taking proactive steps to reduce complexities pertaining to regulatory compliance. This move is primarily targeted to improve manufacturer efficiencies. The rise of the smart city concept across key regional pockets is further leading to advancements in connected infrastructure, pushing growth of the semiconductors and ancillary components market. The demand for encoders is witnessing a surge on account of this rapid growth in the global manufacturing sector.” — Consultant – Electronics & Semiconductors, Future Market Insights
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Top Insights on the Global Encoder Market
- North America is anticipated to lead the global encoder market in terms of revenue, with increasing demand for encoders to be witnessed across the automotive and electronics industries.
- Sales of rotary encoders are estimated to outpace linear encoders in the coming years. FMI estimates sales revenue of rotary encoders to cross 50% of the global market share by the end of 2018.
- Among the end-use industries utilising encoders, the automotive sector is projected to display a heightened demand and adoption scenario, primarily owing to increasing demand from automotive OEMs. The global textile & printing machinery industry is witnessing technological advancements and the use of encoders is anticipated to increase in this sector in the coming years. The textile & printing machinery industry is expected to be the most lucrative vertical in the global encoder market.