Product miniaturisation and bus networking to energise temperature sensors and instruments markets

Citation

(2000), "Product miniaturisation and bus networking to energise temperature sensors and instruments markets", Sensor Review, Vol. 20 No. 2. https://doi.org/10.1108/sr.2000.08720bab.005

Product miniaturisation and bus networking to energise temperature sensors and instruments markets

Product miniaturisation and bus networking to energise temperature sensors and instruments markets

Keyword: Temperature sensors

The European temperature sensors and instruments market has reached a fairly critical point in its existence, where many of the technologies are becoming mature. The highly competitive nature of the market has forced prices downward, which is currently hindering revenue growth.

For some products, manufacturers have successfully improved their techniques to cut costs, and a reduction in price is likely to increase the saleability of certain products. The majority of growth in the future is likely to derive from the RTD, infra-red pyrometer and temperature transmitter markets, says a new study by Frost & Sullivan, the international market consulting company.

This has left the more mature technologies, such as thermocouples, thermistors and thermometers, under intense price pressure and in a state of decline. Manufacturers active in these markets are likely to stem the price decline in the future in order to stave off revenue decline.

The relative ease of manufacture of and increased interest in mass-produced thin film resistance thermometer devices (RTDs) have made prices more attractive, thus enabling the technology to penetrate new markets.

The drive towards increased efficiency and economy in the process industries is the main factor maintaining interest in the overall temperature sensors and instruments market. Trends towards digital equipment and bus networking systems are also positive features of the market, which are set to rise in significance.

Vicky Whiting, Industry Analyst at Frost & Sullivan, comments: "It is important for a company to decide whether to participate in the low or high end of this market. Low price products have tight profit margins but require little service support or additional extras. Companies offering high end solutions enjoy larger profit margins but must be in a position to offer benefits such as quality assurance, training and service."

Andreas Themis, joint author of Frost & Sullivan's latest study, continues: "Companies hoping to succeed in the future should begin to focus on providing enhanced customer service and new ways to market their products in order to distinguish themselves from rivals in the marketplace. However, it has become increasingly difficult for companies to gain a competitive edge by offering a leading technology in the European temperature sensors and instruments market."

The outlook for the European temperature sensors and instruments market, currently valued at $507.1 million, is typified by rising demand in places, coupled with stabilising prices. Manufacturers are hopeful that investment and interest will rise in the more expensive, higher quality temperature sensors and instruments.

The clear trend towards product miniaturisation, coupled with the introduction of bus networking systems and the rising demand for increased accuracy and efficiency in process industries, is a key factor providing stimulus for growth.

Future growth is expected to be assisted by an anticipated end to the price decline, particularly as more customers purchase higher quality products, the possibilities of renewed investment and the impact of bus networking systems. It is forecast that revenue growth rates will steadily rise throughout the rest of the forecast period, while unit shipment growth is expected to remain fairly stable. According to Frost & Sullivan's study, the total market is forecast to reach $529.3 million in 2006.

The market is becoming much more orientated towards the large multinational suppliers, with end-user trends benefiting the larger companies. Growing demand for a complete solution from one supplier and global sourcing both favour the multinationals who have a wider range of products and services to offer, and the ability to provide these services world-wide. Continued consolidation of the market is expected in the future, with more small companies expected to be "swallowed up" by the larger suppliers.

Commenting on the competitive situation in this market, Vicky Whiting states that the two most notable acquisitions consist of the acquirement of Heraeus by Fisher Rosemount and ABB's take-over of the Elsag Bailey Hartmann & Braun consortium. These two companies now hold dominant positions in the European temperature sensors and instruments market.

Report Code: 3813, Publication Date: January 2000, Price: 3,950 Euros.

For further information, please contact: Frost & Sullivan's Public Relations Department .Tel. +44 (0) 171 915 7824; Fax: +44 (0) 171 730 3343; E-mail: kristina.menzefricke@fs-europe.com; or see the company's Web site: www.frost.com for details on Frost & Sullivan's media service.