The market earned revenues of US$1.66 billion in 2012, and Frost & Sullivan estimates this to reach $3.51 billion in 2019. The study also outlines the prospective areas of growth globally.
With navigation emerging as a must-have feature in smart phones and cellular handsets, the need for digital compasses has spurred the global magnetic sensors market.
“Moreover, the mandatory fitment of magnetic sensors in vehicles due to regulations from the automotive sector has fuelled sale volumes,” said Frost & Sullivan measurement and instrumentation senior industry analyst V Sankaranarayanan. “Opportunities for magnetic sensor vendors in the automotive industry will continue to open up as new applications emerge.”
However, this immense potential may not translate into equivalent revenues as intense competition leads to pricing pressures. Manufacturers are reducing prices to penetrate markets such as consumer electronics, where a compelling price point is crucial for success. Profits are also affected as automotive manufacturers apply downward price pressure on sensor manufacturers.
To counter these challenges, innovative product differentiation strategies are necessary. Products must move from competing purely on price to non-price factors, especially as customers look for unique solutions with tangible benefits.
“Manufacturers are investing in technological advancements and the widening of magnetic sensor application areas,” noted Sankaranarayanan. “Magnetic sensors have already evolved greatly in terms of sensitivity, size, packaging and flexibility. Miniaturization, in particular, will be a common trend in the global magnetic sensors market.”
Demand from Asia-Pacific and Latin America is likely to push technology and product development further, the report says.