July 20, 2024
Optical Encoder Market

The Optical Encoder Market is Expected to driven by Industrial Automation Adoption

Optical encoders are electronic devices that measure the rotational displacement of shafts and are increasingly used in industrial automation. They are precise sensors which convert the angular position or motion of a shaft or axle to a digital code, making them useful in motion control systems and other industrial applications that require high accuracy and resolution. With advancements in sensing, communication, and computing technologies, optical encoders have enabled more complex industrial processes to be controlled and automated. The growing emphasis on improving productivity has fueled investments in industrial automation technologies across industries like manufacturing, oil and gas, mining, and others. This has created substantial demand for sophisticated feedback systems incorporating high-performance optical encoders.

The global Optical Encoder Market is estimated to be valued at US$ 2,580.9 million in 2023 and is expected to exhibit a CAGR of 8.7% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

One of the key trends driving the optical encoder market is the rising adoption of encoded motors. Integrating encoders into motors allows for closed-loop motion control which offers greater precision and accuracy compared to open-loop control. Many industrial applications requiring exact motion profiles are upgrading to encoded motors with optical encoders built-in. This includes packaging machinery, 3D printers, semiconductor manufacturing equipment, and CNC machines. Major motor manufacturers are also offering a wider variety of encoder-integrated motors customized for different applications. The advantages of integrated designs such as simplified assembly and reduced part count are boosting their popularity. Furthermore, technological advances are making encoded motors more affordable and accessible even for low-cost motion control products. This widespread use of encoded motors will continue spurring the demand for optical encoders globally over the forecast period.

Porter’s Analysis

Threat of new entrants: The threat of new entrants is moderate. The market requires high initial investments and technological expertise making it difficult for new players to enter.

Bargaining power of buyers: The bargaining power of buyers is moderate. Optical encoders are a specialized product requiring technical expertise limiting buyer options.

Bargaining power of suppliers: The bargaining power of suppliers is low. There are several component suppliers resulting in low supplier concentration in the market.

Threat of new substitutes: The threat of new substitutes is low. Other motion sensing technologies are not able to match the precision and durability of optical encoders.

Competitive rivalry: Competition in the market is high with the presence of global players. Players compete on product design, reliability and pricing.

Key Takeaways

The Global Optical Encoder Market Demand is expected to witness high growth over the forecast period. The global Optical Encoder Market is estimated to be valued at US$ 2,580.9 million in 2023 and is expected to exhibit a CAGR of 8.7% over the forecast period 2023 to 2030.

The Asia Pacific optical encoder market is expected to grow the fastest during the forecast period due to increasing industrial automation in China, Japan and other Asian countries. North America dominates the optical encoder market currently owing to rapid industrialization. The demand for agricultural, manufacturing and automotive equipment in the region is driving the adoption of optical encoders.

Key players operating in the optical encoder market are Honeywell International Inc., Renishaw plc, Sensata Technologies, Inc., US Digital, Rockwell Automation, Inc., Allied Motion Technologies Inc., and Grayhill Inc. Companies are focusing on new product launches and strategic partnerships to gain market share.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it