Research Overview
High Price Pressures Limiting Profit Margins in Accelerometers Market
Maintaining reasonable price levels and profits simultaneously is posing a
significant challenge to suppliers of accelerometers. End users of
accelerometers are extremely price sensitive, especially in the automotive and
white goods market. The price pressure permeates down to the lowest level
in the supply chain, resulting in concerted efforts to develop cost effective
motion sensitive materials. Stiff competition among the suppliers has compelled
drastic price reductions in order to sustain demand from a relatively small
customer base. With prices of accelerometers falling between 3 percent to 5
percent, maintaining regular investment in research and development activities
has become all the more challenging.
This Frost & Sullivan research analyzes various market drivers and
industry challenges that are expected to influence growth in the North American
accelerometers market. It focuses on the latest technological and pricing trends
in the market. The study also highlights the key application and end-user
segments that are poised for growth in the future.
Increasing Demand for High Performance and Reliable Accelerometers
Technological considerations, quality, reliability, after-sales service, and
brand reputation are some of the key factors governing purchasing decisions in
the accelerometers market. Reliability is particularly important, since most
applications are safety related and accelerometers need to convey accurate data
within a reasonable time frame. In addition, end users that purchase in bulk,
especially in automotive and industrial sectors, insist that suppliers
manufacture high volumes and strictly meet delivery deadlines. "The
micromachining fabrication process enables acceleration sensor manufacturers to
mass-produce their sensing technologies which simultaneously results in lower
prices to commercially accepted levels," says the analyst of this research.
Direct sales and extensive network of distributors are likely to play a key
role for the success of accelerometers market. In response to this,
manufacturers and suppliers are offering additional services such as designing
and engineering logistics solutions in order to strengthen and maintain
long-term relationships with their clientele.
Product Differentiation to Uphold Market Response for Accelerometers
Although product differentiation is challenging given the lack of variance in
technology trends, it has become all the more critical for long-term success in
the accelerometers market that is getting highly competitive. Manufacturers of
accelerometers need to look beyond incorporating micro electro mechanical
systems (MEMS). "For example, end users in the high-end applications such
as aerospace, industrial, and patient monitoring arenas are increasingly opting
for wireless sensors," observes the analyst. Miniaturization is also an
emerging trend that will enable accelerometer suppliers to penetrate untapped
markets. These accelerometers are highly sensitive with ultra low noise
capability, thus have found acceptance in a range of applications that include
automotive, security, office equipments, white goods, and consumer electronics
and sports equipments.
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