Recently, Precedence Research, a global market research and consulting firm, published a report titled "Optoelectronics Market: by Device, by Device Material, by Application, by Industry Vertical - Global Industry Analysis, Size, Share, Growth, Trends, Regional Outlook and Forecasts, 2023-2032 , analyzes the optoelectronics market in detail in multiple dimensions.
The report states that the global photovoltaic market size was around USD 6.54 billion in 2022 and is expected to climb to over USD 21.2 billion by 2032, growing at a CAGR of 12.48% during 2023-2032.
Report: Global optoelectronics market size will exceed $21.2 billion in 2032
This significant growth is mainly attributed to the continued growth in investments in the defense sector, increased collaboration between key industry players, increased investments in healthcare and medical devices, and strong investments by governments across the globe in smart city projects.
Optoelectronics, a major branch of electronics, focuses on the study of light emitting and detecting devices. These devices bridge the communication gap between optics and electronics, and research, innovation and design of hardware that converts electrical energy into light or light into electrical energy. Light-emitting devices - such as LEDs and lasers - then utilize voltage and current to generate electromagnetic radiation or light for a wide range of applications such as illumination and indication.
On the other hand, phototransistors and other light-detecting devices are responsible for converting electromagnetic energy into current or voltage, which is widely used in the fields of communication and light sensing. For example, devices such as remote control switches rely on this technology. Photovoltaic technology is also widely used in numerous fields such as military, telecommunication, automated access control systems, and medical devices.
Geographic Regional Market Analysis
Precedence Research predicts that Asia Pacific will dominate the market next. The leading position of this region in the consumer electronics and automotive markets is a key driving factor for its rapid expansion. In addition to this, optoelectronic devices are showing great growth potential in smart city projects, cutting-edge technologies such as virtual and analog reality, big data, Internet of Things (IoT), and smart industrial appliances.
Notably, the Asia-Pacific region is not only a major producer of semiconductor components, but also hosts a number of key optoelectronics companies such as Rohm, Sony, Renesas, Samsung Electronics, Panasonic, Hamamatsu Photonics and Sharp. In addition, there are a number of smaller regional players, which together form the core force driving market growth.
The rapid growth of the electronics industry in China is attributed to the continued high consumer demand for smart devices, virtual reality, and drones. In the case of smartphones alone, production has climbed rapidly from 237.2 million units in 2012 to 901.2 million units in 2017. Meanwhile, China's domestic vehicle production is expected to top 35 million units by 2025, according to the U.S. International Trade Administration, making it still the world's largest automotive market in terms of both annual sales and manufacturing output.
In Europe, on the other hand, the regional market is expected to see significant growth in the coming years due to the rapid spread of electric vehicles. In fact, according to the International Energy Agency, Europe has become the world's second-largest market for electric vehicles. by 2022, electric vehicle sales will grow by more than 15 percent, with more than one in every five vehicles sold being electric. This trend undoubtedly provides strong support for the future growth of this market.
Report Highlights
In terms of application segmentation, optical measurement is expected to witness the fastest growth rate during the forecast period.OMS (optical mouse sensor) accurately detects light through time-of-flight triangulation and further infers the 3D position of the marker. Notably, OMS can only collect data from a specific area and is dependent on a fixed camera. Owing to its high-precision nature, optoelectronic measurement systems have been used in a wide range of applications such as process monitoring and control as well as machine vision in several industries, which is a key factor driving the market uptake.
From a vertical perspective, the healthcare industry is expected to exhibit the highest CAGR during the forecast period. This growth trend is mainly attributed to the extensive use of optoelectronics in various types of medical devices. With the rising prevalence of chronic diseases such as cancer and cardiovascular diseases, the demand for medical devices is expected to continue rising in the coming years.
Driving Factor: Growing Automotive Industry
The main objective of electronic components is to improve the performance and efficiency of the powertrain. These components help the automotive powertrain to communicate, detect signals, and manage its activities. These components are used in vehicles to increase safety and improve vehicle performance. In the present scenario, modern vehicles are equipped with electronic components such as sensors. Thus, the growing automotive industry is expected to drive the market growth over the forecast period.
Restraints: high cost of optoelectronic products
Optoelectronic products are more expensive than regular products, which tends to be one of the barriers hindering the expansion of the market. Since LCD screens are cheaper than LED screens, customers can opt for alternative technologies instead of optoelectronic products. Replacement of spare parts is more costly as compared to regular products. Thus, cost becomes a restraining factor for the growth of the optoelectronics market. The optoelectronics market is heavily dependent on LCD screens and hence a decline in sales will have a significant impact.
Opportunity: Growing applications in the medical field
The application of optoelectronics in endoscopic treatments and surgeries is expected to progress positively. In addition, optoelectronics is used in pulse oximetry, blood diagnostics and dental diagnostics in the healthcare industry. Optoelectronics are also used in the medical devices market due to the optics of the devices. There are tons of opportunities in the optoelectronics business due to the convergence of healthcare and technology. Thus, the application of optoelectronics in healthcare is expected to drive the growth of the market over the forecast period.
Market Segmentation
The global optoelectronics market can be segmented on the basis of device type into LEDs, sensors, infrared components, optocouplers, photovoltaic cells, displays, and others. Among these, the sensors segment is expected to dominate the market during the forecast period. This is mainly attributed to the wide application of sensors such as photodiodes, optical sensors, and image sensors in various verticals such as automotive, manufacturing, aerospace, healthcare, and marine.
In automotive applications, for instance, sensors play a key role in braking and traction control, airbag systems, and collision avoidance. For example, antilock braking system (ABS) sensors continuously provide data to the system control unit to measure wheel speed and braking force to ensure driving safety. This trend augurs well for the critical applications of sensors in different verticals that will drive the market to flourish over the forecast period.
From the device material perspective, the global optoelectronics market can be categorized into gallium phosphide, gallium arsenide, gallium nitride, silicon carbide, silicon germanium, and indium phosphide. Among these, the gallium nitride segment is expected to dominate the market over the forecast period. This is mainly attributed to its numerous advantages such as lower energy cost, higher power density, higher switching frequency, and lower system cost. For instance, the high switching frequency of gallium nitride devices makes it possible to use smaller inductors and capacitors in power supply circuits, thereby significantly reducing weight, size, and cost. This technological innovation provides strong support for market growth.
Optoelectronics is increasingly used in a wide range of applications
Optoelectronics technology produces high beam quality light with minimal power and energy consumption and is widely used in applications such as consumer electronics, automotive, aerospace & defense, IT & telecom, food & beverage, healthcare, energy & utilities, residential, industrial, commercial, and others.
The consumer electronics industry is expected to hold the largest market share during the forecast period. The growth of this segment is attributed to the increased demand for consumer electronics such as smartphones, TVs, refrigerators, and laptops. According to the vision of India's Ministry of Electronics and Information Technology, exports from the Indian electronics industry are expected to reach $120 billion by 2026. This trend provides strong support to the market growth and augurs well for a booming market during the period 2023-2032.
