Optical Encoder Market Analysis

Global Optical Encoder Market Overview:

Optical Encoder Market Size was valued at USD 2.2 Billion in 2023. The Optical Encoder market End User is projected to grow from USD 2.39 Billion in 2024 to USD 4.2 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 7.29% during the forecast period (2024 - 2032). Rising need for improved automation, expanding demand for high-end automation across a variety of industries and verticals, and rising uptake of cutting-edge motion control systems, are the key market drivers enhancing the market growth.

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Optical Encoder Market Trends

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  Increasing adoption of advanced motion control systems is driving the market growth

  
  

During the forecast period, rising use of cutting-edge motion control systems is anticipated to fuel market expansion for optical encoders. Numerous industries, such as offshore equipment, construction equipment, automotive, military & aerospace, and alternative energy systems, are adopting advanced motion control systems. This demand is explained by the growing need for dependable performance in harsh environments. Furthermore, in order to meet the growing demand for use in various areas and industries, next-generation encoders have been created that use solid-state electronics rather than sensitive mechanical devices. Over the forecast period, a rising demand for better automation is anticipated to drive the growth of the worldwide optical encoder market. More orders are being placed for sophisticated and increasing applications, together with manual and traditional controls, for cutting-edge automation. For industrial applications, there is a strong need for automated controls in order to increase production, cut costs, and improve performance. Additionally, the introduction of unique features like better diagnostic capabilities is anticipated to fuel the growth of the worldwide optical encoder market in the near future.

Encoder usage is rising for a variety of applications as automation adoption soars across all industries. In linear measuring, web tensioning, registration mark timing, backstop gauging, filling, conveying, etc., encoders are employed as examples. The bulk of these electric motors employ encoders to monitor or regulate the operations of the motors since, similarly, in industry, half of the electricity is used to power electric motors. Encoders are also utilised in robotics, whether it be in a guided robot or an articulating arm employed in a manufacturing facility. For these automated systems to operate with little help from humans, efficient speed and positioning feedback systems are required. Since perfect control of the robotic system depends on force sensing and adjustment, the encoder industry is utilised in a variety of applications.

The use of embedded microprocessors to increase the sensitivity of encoders, their functionality, and signal processing capabilities, as well as to let users customise the system using smartphones and web portals, is also having a beneficial impact on market growth. Aside from that, the development of the market is being aided by the incorporation of Internet of Things (IoT) technology, which enables users to analyse encoders remotely, offers diagnostic and condition monitoring capabilities, and precisely anticipates a future failure. Additionally, the market is growing as a result of rising product acceptance in the healthcare sector for robotic surgery, ophthalmic laser treatment, radiation therapy, artificial respiration, orthopaedic rehabilitation, and laboratory analysis. The market is expected to rise as a result of a number of other factors, such as quick industrialization, rising R&D spending on novel technologies, and extensive product use in consumer electronics like scanners, printers, and copiers. Thus, driving the Optical Encoder market revenue.

Optical Encoder Market Segment Insights:

Optical Encoder Type Insights

The Optical Encoder market segmentation, based on type, includes incremental and absolute. Absolute segment dominated the market in 2022. Absolute rotary encoders generate a stream of distinctive digital codes that measure the object's actual position rather than pulses to identify the encoder's location. They provide separate position values as soon as they are turned on by scanning the location of a coded component. Absolute linear encoders produce a digital output that is analogous to this and represents the actual position of the unit. In order to maintain correct position data even in the case of a power outage, these encoders assign each location a unique digital value. Absolute encoder is offered and produced by several large firms, including Sensata Technologies Holding plc (US), Fortive (Dynapar Corporation) (US), FRABA B.V. (The Netherlands), and Renishaw plc (UK).

Optical Encoder Channel Insights

The Optical Encoder market segmentation, based on channel, includes 1 channel, 2 channel, and 4 channel, and more than 8 channels. 2 channel segment dominated the Optical Encoder market in 2022. The rising demand for 2 channel optical encoders is to blame for this.

Optical Encoder End User Insights

The Optical Encoder market segmentation, based on end user, includes automotive, electronics, medical devices, textile & printing machinery, aviation, and others. Automotive segment dominated the market in 2022. In automotive applications, encoders are utilised for conveying, filling, backstop gauging, web tensioning, registration of mark timing, and linear measurement. The most typical use is for electric motor motion control via feedback. Electric motors use the majority of the electricity needed in the industrial sector, and they typically use encoders. Encoders, for instance, are extensively used in robotics to recognise motion position, control joint position, measure linear extension, and provide force feedback to grippers and fingers.

Figure 1: Optical Encoder Market, by End User, 2022 & 2032  (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Optical Encoder Regional Insights

By region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. The North America Optical Encoder Market dominated this market in 2022 (45.80%). Manufacturers are increasingly providing competitively priced goods with high precision, smaller sizes, lower weights, and lower power consumption to maintain in the healthcare equipment market, which has led to an increase in the use of optical encoders in the region for portable medical devices. The presence of well-known industry players is the primary factor influencing the optical encoder market in the United States. Further, the U.S. Optical Encoder market held the largest market share, and the Canada Optical Encoder market was the fastest growing market in the North America region.

Further, the major countries studied in the market report are The US, Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 2: OPTICAL ENCODER MARKET SHARE BY REGION 2022 (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Europe Optical Encoder market accounted for the healthy market share in 2022. The requirement for high-quality assurance in Surface Mount Technology (SMT) activities in the region is growing as a result of the complexity of electronic goods. As SMT placement equipment makers use more sophisticated absolute encoders, the market is growing. Optical encoder systems have been proven to increase efficiency and enhance repeatability in consumer electronics and the healthcare sector. Additionally, as a result of the expansion of the healthcare industry in the region, industries continue to embrace encoder goods. These factors will generate a lot of opportunities for the local optical encoder industry. Further, the German Optical Encoder market held the largest market share, and the U.K Optical Encoder market was the fastest growing market in the European region.

The Asia Pacific Optical Encoder market is expected to register significant growth from 2023 to 2032. Optical encoders are finding a wide range of prospects in the Asia Pacific region as a result of the area's rapid expansion in industries like consumer electronics, transportation, and industrial automation. Modern production methods are being used by the nation's manufacturers to minimise costs, shorten production times, and improve final product quality. In addition, the cost of hardware, software, and other crucial components is coming down, which is assisting Asia and the Pacific's economic expansion. The Asia Pacific region's need for encoders is influenced by a wide range of factors in many different industries. Moreover, China’s Optical Encoder market held the largest market share, and the Indian Optical Encoder market was the fastest growing market in the Asia-Pacific region.

Optical Encoder Key Market Players & Competitive Insights

Leading market players are investing heavily in research and development in order to expand their product lines, which will help the Optical Encoder market, grow even more. Market participants are also undertaking a variety of strategic activities to expand their footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, Optical Encoder Industry must offer cost-effective items.

Manufacturing locally to minimize operational costs is one of the key business tactics used by manufacturers in the Optical Encoder Industry to benefit clients and increase the market sector. In recent years, the Optical Encoder Industry has offered some of the most significant advantages to medicine. Major players in the Optical Encoder market, including Sensata Technologies, POSITAL FRABA, Renishaw plc, IFM Electronics, Dynapar Corporation, and HEIDENHAIN, are attempting to increase market demand by investing in research and development operations.

Honeywell International Inc. is a business that deals with engineering and technology. In order to address issues in a variety of industries, including energy, security, safety, productivity, and urbanisation, the company develops and produces technologies. Among Honeywell's offerings are specialty chemicals, process technologies, electrical and complex materials, productivity, sensing, safety and security technology, and replacement parts. It also provides management, technical, maintenance, and repair services. In the building, petrochemical, aerospace, and refining industries, Honeywell serves customers in North America, Europe, and other continents. It runs manufacturing and other enterprises all around the world. The headquarters of Honeywell are located in Charlotte, North Carolina, in the United States. In October 2019, Honeywell International launched a new smart hearing solution to assist businesses in better protecting staff members from noise-induced hearing loss. This approach makes advantage of pattern analysis and real-time sound monitoring.

Industrial technology-related sensors and controllers are produced, developed, and sold by Sensata Technologies Holding plc (Sensata). The company's product line includes relays and switches, semiconductor connections, actuators and motors, thermal management, inverters and chargers, switches and pressure sensors, force, position sensors and encoders. The following are just a few of the industries it supplies products for: building, semiconductors, automotive, agriculture, marine, energy, telecom, professional food equipment, commercial truck and trailer, motorcycles, off-road vehicles, aerospace and defence, heating, ventilation and air conditioning (HVAC), motors, industrial, material handling, and medical. Asia, Europe, and the US are all where the company has operations. Sensata Technologies is based in Attleboro, Massachusetts, in the United States. At the Paris Airshow in June 2019, Sensata Technologies made its debut with its aerospace solutions, which also included pressure switches, position sensors (LVDTs/RVDTs), temperature sensors, aircraft circuit breakers, and hermetic thermostats, switches, and pressure switches.

Key Companies in the Optical Encoder market include

• Sensata Technologies


• POSITAL FRABA


• Renishaw plc


• IFM Electronics


• Dynapar Corporation


• HEIDENHAIN

Optical Encoder Industry Developments

In 2023, Omron Corporation announced the release of its newly developed E6B2-CWZ6C incremental encoder that is suitable for use in harsh environments. The E6B2-CWZ6C incremental encoder has an IP68 rating and can withstand temperatures ranging from -40°C to 85°C.

In 2023, Honeywell International Inc. announced the launch of its new HEDS-9500 absolute encoder designed for precision applications. The HEDS-9500 absolute encoder provides resolutions of up to one million counts per revolution as well as accuracy within ±0.002 degrees.

November 2023: Baumer launched the absolute encoder EAM580RS aimed at providing safety and performance even in harsh working conditions, such as mobile machinery and outdoor surroundings. In addition, these kinds of safety-certified encoders offer safe automation that is easy to implement at a low cost since it consumes less energy. The magnetic safety enclosure is built using stainless steel material, thus protecting it from severe outside weather conditions like excessive heat or rain, as well as being able to undergo industrial factors such as vibrations or shocks.

October 2023: ZS Instruments was awarded a $1 million grant by National Science Foundation (NSF) funds to develop advanced lithography technology for precision optical encoders. These funds will be used to enhance the manufacturing of sensors that are involved in semiconductor fabrication and inspection, precision machining equipment, UAV guidance and tracking systems, medical imaging equipment, industrial robots, and measuring instruments.

August 2023: Dynapar, a manufacturer of encoders, introduced HS35iQ Encoder with PulseIQ Technology, their latest programmable hollow shaft encoder, in August 2023. This self-diagnostic feedback device has colored LEDs and digital outputs, allowing OEMs and end users in heavy-duty machine applications to identify faulty encoders by checking on real-time information about the health status of encoders.

June 2023: British Encoder launched its newest catalog that showcases a collection of encoders tailored for various industries, starting from manufacturing and robotics to aerospace and medical devices. These encoders are purpose-built to excel in specific applications and ensure that each encoder seamlessly integrates into the unique environments and challenges of different industries.

In 2022, Baumer Group announced the release of its new OADM 58 incremental encoder, which is meant for compact areas. The OADM 58 incremental encoder only measures with diameters of just 18mm and a height of only 16mm.

Optical Encoder Market Segmentation:

Optical Encoder Type Outlook

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  Incremental

  
  


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  Absolute

  
  

Optical Encoder Channel Outlook

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  1 Channel

  
  


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  2 Channel

  
  


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  4 Channel

  
  


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  More Than 8 Channels

  
  

Optical Encoder End User Outlook

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  Automotive

  
  


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  Electronics

  
  


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  Medical Devices

  
  


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  Textile & Printing Machinery

  
  


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  Aviation

  
  


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  Others

  
  

Optical Encoder Regional Outlook

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  North America

  
  

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  US

  
  


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  Canada

  
  

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  Europe

  
  

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  Germany

  
  


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  France

  
  


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  UK

  
  


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  Italy

  
  


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  Spain

  
  


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  Rest of Europe

  
  

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  Asia-Pacific

  
  

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  China

  
  


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  Japan

  
  


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  India

  
  


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  Australia

  
  


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  South Korea

  
  


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  Australia

  
  


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  Rest of Asia-Pacific

  
  

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  Rest of the World

  
  

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  Middle East

  
  


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  Africa

  
  


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  Latin America