03 June 2008
Prepared by:James K. Taylor, DirectorIndustrial Automation and Control PracticeVenture Development CorporationMay 2008All rights reservedMARKET SIZE AND OUTLOOKProduct MarketsCurrent and forecast worldwide shipment of major machine automatic safeguarding product classes are detailed below. All figures are in $US millions.Presence Sensing Safety Sensors (Includes edges laser scanners, light curtains, mats, optoelectronic devices (single and multi-beam)2007: 648.2; Expected in 2012: 977.6; CAGR: 8.6%Safety Controllers/Modules/Relays (Includes configurable, electromechanical-single function, modular relay sysytem, programmable, solid state-single function, speciality controllers (for edges, mats, light curtains, two hand safey controls)2007: 422.4; Expected in 2012: 613.4; CAGR: 7.7%Safety Interlock Switches(Includes electromechanical (keyed and un-keyed), hinge pin, limit, non-contact (magnetic, magnetic coded, RFID), tongue (with and without solenoid latching), trapped key (with and without solenoid latching)2007: 282.9; Expected in 2012: 416.1; CAGR: 8.0%Programmable Safety Systems (Safety PLCs) (Includes stand alone systems, those integrated with machine controllers (a common CPU)2007: 174.7; Expected in 2012: 332.4; CAGR: 13.7%Emergency Stop Controls (Includes palm button safety controls, rope (cable) pull switches2007: 100.8; Expected in 2012: 139.6; CAGR: 6.7%Two Hand Safety Controls (Includes electromechanical, ergonomic types)2007: 18.1; Expected in 2012: 25.2; CAGR: 6.8%Total:2007: 1647.1; Expected in 2012: 2504.3; CEGR: 8.7%Via the implementation of these products, users gain cost savings in operations through more efficient operation of high-speed and powerful machinery and equipment without fear of personal injury or equipment damage. Nonetheless, many factors will determine the rate of shipment growth for these products. Several of these are:* Automation innovations bringing about need for newer equipment and machinery, including safeguarding methods and equipment for these. Often these innovations are driven by the need for higher productivity at lower cost, and often by the need for new equipment or machinery for new products. * Changing machine safeguarding safety standards, regulations and enforcement, and the pace of these changes. Concerns over lawsuits from non-compliance and injuries or death, and changing company safety policies are major factors. * Growth expectations in the various worldwide economies, and likely growth in levels of capital investment in manufacturing.* Increasing levels of understanding and acceptance of machine automatic safeguarding technologies in various regions and countries.A significant reason for the different growth rates are the extent of usage in different applications and industries, and growth expectations for these. In addition, in some applications there is competition among the different technologies, with displacements occurring. Presence-Sensing Safety Sensors – By far the largest dollar volume shipments of presence-sensing sensors are in light curtains. The forecast shipment growth rate for these is also the highest. Laser scanners accounted for the second largest dollar volume shipments in 2007, and are forecast to have the second highest growth rate among the presence sensing sensors. The lowest shipment growth rates are forecast for contact safety mat and edge products. These are being displaced in applications by non-contact optoelectronic, light curtain, and laser scanner products. Safety Controllers/Modules/Relays – By far the largest shipments in this product category are of electromechanical single-function relays. This segment is expected to remain the largest, but to have a below-average growth rate over the forecast period. Higher growth rates are forecast for configurable and programmable types, modular relay systems, and solid state-single function types, although the forecast shipment growth rate for the solid state-single function type is below average. A well below-average growth rate is forecast for the small worldwide specialty controller market.The configurable, modular relay, and programmable controller products are attractive because these provide ease of implementation, along with flexibility and/or expansion capabilities in applications where more expensive safety PLCs are not needed. Thus, these are displacing other types of controllers in applications. Safety Interlock Switches – Among the safety interlock switches studied, electromechanical (keyed and un-keyed) types account for the largest shipments. These will remain the largest safety interlock switch category. However, the lowest shipment growth rate is forecast for these among all the safety interlock switches studied. The highest unit growth rates are forecast for the non-contact switches. High reliability and low cost make these attractive. Also among these, the highest growth rate is forecast for the small magnetic-coded segment. The switching action of these products cannot be defeated with a simple magnet, thus providing additional safety and security. Programmable Safety Systems (Safety PLCs) – In 2007, over half the worldwide shipment of safety PLCs was of those integrated with machine controllers, and this segment is forecast to have the highest worldwide shipment growth rate of all the products under study. The standalone safety PLC market is also forecast to have a high growth rate.Safety PLCs eliminate or reduce the use of separate safety relays or controllers. In addition, safety PLC systems with interconnections via safety buses reduce hardwiring and provide improved diagnostics, easier maintenance and higher reliability. Depending on the complexity of the application these can simplify designs, and provide design flexibility and scalability. Usage is particularly attractive when machines and controls become more complex (i.e., requiring many emergency stops and/or safety gate switches with multiple actuators).Beyond this, integrated safety PLCs provide commonality of programming and maintenance procedures, and of controllers and I/O products, thus reducing training costs, allow faster designs, installations and commissioning, and easier maintenance and quicker recoveries after shutdowns. With integrated safety PLC systems there is better information sharing. This is increasingly important as machines become more complicated, as this simplifies the adding of new functions and diagnostics. Emergency-Stop Controls – Of the two types of emergency-stop controls covered in the study, the largest worldwide shipments are for palm button safety controls. This segment is forecast to be the slowest growing over the forecast period. However, the worldwide growth rates for both these and rope (cable) pull switches are forecast at below average. These are being displaced in applications by more automated safety sensing and shutdown means. Two-Hand Safety Controls – Below-average worldwide shipment growth rates are forecast for both the electromechanical and ergonomic two-hand safety controls under study, with the former having the lowest. The low rates reflect relative slower shipment growth expectations for the machinery on which these are used. Adding to this trend is increasing automation, such as automatic machine loading and unloading, which is eliminating the need for some two-hand controls. Price TrendsOf the 27 types of machine automatic safeguarding products covered in this study, the average selling prices for 21 are expected to decline over the forecast period, with two expected to hold steady and four to increase. The largest decline is expected for programmable safety controllers integrated with machine controllers. The largest increase is expected for ergonomic two-hand safety controllers.Factors tending to drive prices down include – advances in electronic technology, economies of scale with increasing shipment levels, entry of low-cost vendors, OEM pressures, and trends to use of commodity products.Factors tending to limit price declines, hold these steady, or lead to increases include – co-petition: vendors deciding in certain segments not to enter into strong price competition, feature additions and performance enhancements, increasing material and energy costs, increasing shipping costs, new machinery applications, and new safety standards and regulations.Regional MarketsYear 2007 and forecast 2012 worldwide shipment shares of the machine automatic safeguarding products under study to the three major geographic regions are:EMEA (Europe, Middle East and Africa): In 2007: 60.0%; Expected in 2012: 55.2%Americas (Central, North and South America): In 2007: 24.6%; Expected in 2012: 24.8%Asia-Pacific: In 2007: 100.0%; Expected in 2012: 100.0%The overall EMEA market for these products is the largest and most mature (principally in Europe), with the lowest forecast growth rate. However, it should still contribute the most to overall dollar volume growth in the market through the forecast period. The most rapid growth is forecast for shipments to markets in the Asia-Pacific region. In addition, this region is forecast to account for a larger overall growth in the worldwide market over the forecast period than the larger Americas market. Most of the Americas market for these products is in North America, and principally in the United States. Even in the US, however, there is not the maturity and extensiveness in use of these products as found in Europe. The Americas market is forecast to grow faster than that in the EMEA region, but it is expected to be slowed by the weak economy in the United States and the ongoing shifting of manufacturing operations to Asia-Pacific countries. By far the highest overall growth rate is forecast for shipments to Asia-Pacific markets. The most significant reason for this forecast is the rapidly increasing manufacturing operations in Asia-Pacific countries with emerging economies, particularly China. Manufacturing businesses in these countries are being formed and expanded. In addition, manufacturers in other regions are moving operations to these countries with low labor costs. Part of the increases in capital investment by these firms will be the need for machine automatic safeguarding products. In addition, governments in the Asia-Pacific region are becoming more concerned about worker safety, with stricter enforcement of standards/regulations. Also expanding the market are global firms opening manufacturing operations in the region who will tend to implement the same type of machine automatic safeguarding they use elsewhere. Application and Industry MarketsThe relative sizes and forecast growth rates in shipments of the 27 types of machine automatic safeguarding products covered in the study vary by applications and industries within the regional markets. This data is provided in the report. The following covers worldwide application and industry markets for all the products combined.Application Markets – Worldwide the largest 2007 shipments of the machine automatic safeguarding products under study by classes of application were assembly, material handling, metal working packaging and robotics. Metal working applications are expected account for the largest worldwide shipment shares over the forecast period, despite a forecast below-average growth rate. The highest growth rate is forecast for robotics applications, and this segment is also forecast to contribute the most to overall market growth. Industry Markets – Worldwide the largest 2007 shipments of the machine automatic safeguarding products under study by industries served were automotive, electronic products, food and beverage, pharmaceutical and semiconductor. The automotive industry, the largest segment, accounted for 36% of worldwide shipments of these products in 2007. The forecast shipment growth rate for the automotive industry is below average. However, it will remain the largest industry segment, and is expected to contribute the most by far to shipment growth. The highest shipment growth rate is forecast for the semiconductor industry. This segment is expected to contribute the third largest amount to shipment growth. The second highest growth rate is forecast for the pharmaceutical segment. PRODUCT TRENDSProducts trends uncovered by VDC in the course of our research include:Presence-Sensing Safety Sensors and Safety Interlock SwitchesMarket trends are to non-contact products. In presence-sensing devices, this is primarily to light curtains and laser scanners. In interlock switches, this includes magnetic, magnet coded, and RFID types.Safety PLC I/OThe market trend is to greater use of distributed/remote I/O rather than I/O in controller chassis. Furthermore, the trend in the distributed/remote I/O is toward larger shipments of modular rather than block products. Safety Buses/Networks Standalone safety PLCs using SafetyBUS p accounted for the dominant worldwide shipment share of these products in 2007. The second largest share was for DeviceNet Safety. PROFIsafe accounted for the largest shipment share of the safety PLCs integrated with machine controllers, followed by DeviceNet Safety. Shifts are expected in the buses/networks used over the next four years, particularly for the integrated systems. The share of shipments of the buses/networks currently most used are expected to decline, with Ethernet/IP Safety and PROFInet Safety coming into prominent use, with a lesser gain for CC-Link Safety. Both Ethernet/IP Safety and PROFInet Safety are Ethernet-based networks. In general, there is a trend in manufacturing facilities toward Ethernet networks, and this applies also to safety buses/networks. Safety Controllers/Modules/Relays The market trend is away from use of single function and specialty products designed for one type of sensing product to those with more flexibility, and functionality. Worldwide market growth rates are forecast to be higher for the programmable, modular relay system and configurable products than the specialty and singe-function products. SAFETY STANDARD REQUIREMENTS AND TRENDSCurrent Safety Standard RequirementsMany countries have government agencies responsible for the safety of workers and also independent or quasi-government associations or organizations. However, outside of Europe and North America, few have been active in establishing independent machine safeguarding standards. Those that have are mostly using or creating standards based on those of Europe. Safety requirements differ for Europe and North America, despite growing similarity. Each region has specific standards organizations responsible for developing and enforcing relevant machine safety standards. Additionally, the responsibilities and powers of organizations in each region vary greatly. An overview of both European and North American standards organizations and their corresponding requirements are provided in Chapter V of the report. Trends in Safety Standard RequirementsMachine automatic safeguarding standards will continue to be generated, updated, and made obsolete by newer standards and the harmonization of standards. More specific types of machines and applications will be covered, particularly with ongoing automation of manufacturing operations. In addition, better procedures and tighter requirements will be incorporated into standards. Many machine automatic safety equipment manufacturers see trends to globalization of common standards for machine safety as furthering growth for their business. Most agree that this “harmonizing of standards” will occur eventually because it is in the best interests of major users and machine/equipment manufacturers. It allows sale, purchase, and use of the same designs in multiple geographic locations, and – in the end – the ability to sell to more countries and companies.CHANNELS OF DISTRIBUTIONThe following discussion is on overall worldwide and regional sales of the machine safeguarding products under study. Sales force and customer segmentations are presented for the separate product categories, both worldwide and for the major geographic regions in the report. Sales ForcesDue to the large amount of knowledge of technical specifications and safety standards needed, most vendors find their own educated field sales force indispensable. Manufacturers’ representatives/agents account for a much smaller portion of sales. Where sales levels cannot justify use of company field sales personnel, these organizations can provide needed coverage. This may be the case for certain countries, for small vendors, and for vendors expanding their business into new countries and regions.Customer ClassesThe largest share in 2007 worldwide sales of the machine automatic safeguarding products under study were through distributors, with lesser sales direct to OEMs, end users, systems integrators, and private label resellers. CURRENT AND EMERGING USER NEEDSAs part of this market study, VDC surveyed worldwide users (end users, OEMs, systems integrators, etc.) who specify and purchase machine automatic safeguarding products and systems. The following summarize some of the major findings: Reasons for Purchase of ProductsEighty-four percent of surveyed users indicated protection of personnel as a major reason they purchase machine automatic safeguarding equipment. Majorities also indicated the reasons to be part of a risk reduction process by their firm, and because of liability/legal protection issues. Alternative Use of Lock-Out/Tag-Out MethodsThe relative usage of lock-out/tag-out methods versus machine automatic safeguarding was found to be quite varied among user respondents. A significant share does not use lock-out/tag-out methods, or makes limited use of these. However, there are also significant shares that use these extensively, or on all machines. Some use lock-out/tag-out for maintenance, and machine automatic safeguarding for normal operations. Most expect little or no trends. Among those expecting significant shifts, over twice as many expect a shift more to machine automatic safeguarding versus those expecting greater usage of lock-out/tag-out methods. Reasons cited for shifts to machine automatic safeguarding were increased safety, decreased down time, more operator safety, need to error-proof, reduced labor and fewer cross checks required, and the complexity of guarding situations. Feature and Performance RequirementsUsers were asked to identify the most important feature and performance characteristics in their selection of machine automatic safeguarding products. Over three-quarters of respondents identified compliance with standards, and two-thirds reliability. Over half also identified ease of operation/use and functionality. Key Non-Product Vendor Selection CriteriaPrice was the most identified consideration. Most users also cited availability/delivery and service/support, and significant percentages cited experience with the vendor, and vendor reputation among their most important selection criteria.Product InstallationVDC asked machine automatic safeguarding purchasers to identify who installs the products.Among OEMs and System Integrators – The vast majority in this group indicated that they do the installations themselves. A much smaller share indicated that installations are performed by contractors.Among End Users – A majority of the end users also indicated that they perform the installations themselves. Lesser shares indicated that machine suppliers and contractors do installations. Risk Assessments and Site AuditsNeed for Risk Assessments and Site Audits – End users were asked whether or not they have risk assessment and site audit requirements, and the likelihood of having requirements for these in 2012. Among end users in our survey we found the current needs for risk assessments to be much higher for those in the EMEA region than in the Americas, while the need for site audits was found to be higher among those in the Americas. However, many more of the end users in the Americas expect to have a need for risk assessments in the future, and many more of those in the EMEA region to have a need for site audits. Organizations Providing Risk Assessments and Site Audits – Ninety percent of the end users indicated they perform risk assessments themselves, and 65% that they do site audits. Forty-one percent indicated they use third-party organizations for site audits, but only 18% have risk assessments done by third-party organizations. Product ServicingEnd users were asked to identify who provides servicing on their machine automatic safeguarding products. Most indicated they provide servicing themselves. Twenty-five percent indicated servicing is provided by contractors, and 21% by the machine suppliers. Seventeen percent have servicing done by the machine safeguarding product suppliers or their distribution channel partners. Services from Third-Party OrganizationsEnd users were asked whether they utilize certain services of third-party organizations relative to machine automatic safeguarding. These included commissioning, consulting, designs, risk assessment services, risk assessment software, risk reduction services, and training.Most identified by the end users were consulting, commissioning, and training.How Users Learn About Products and VendorsUsers were asked how they learn about machine automatic safeguarding products and vendors. The largest shares of respondents identified the Internet (61%), product literature and catalogs (of distributors – 48%, of vendors – 46%), and trade periodical articles (46%). Trade Periodical Sources – Users were asked from which trade periodicals they most gain information on machine automatic safeguarding products and vendors. Control Engineering magazines were most identified.Trade Show Sources – Overall, trade shows were identified by 34% of the user respondents as information sources for them on machine automatic safeguarding products. They were further asked at which trade shows they obtain this information. Responses from the Americas region users were fragmented, with the largest share at 27% identifying Fabtech. The majority of users in the EMEA region identified the Hannover Messe show. A significant share also identified the SPS/IPC/Drives trade show. VENDOR ANALYSESVendor Shipments and Market SharesThe report provides 2007 vendor shipments and market shares of the machine automatic safeguarding products under study, both worldwide, and in the Americas, EMEA, and Asia-Pacific Regions. The following summarize overall worldwide findings:Worldwide Market LeadersThe worldwide 2007 market leaders in the major product classes were ranked in descending order:Presence-Sensing Safety Sensors1. SICK 2. Omron Industrial Automation3. KeyenceEmergency-Stop Controls1. Schneider Electric2. Rockwell Automation3. Siemens Industrial AutomationProgrammable Safety Systems (Safety PLCs) 1. Siemens Industrial Automation2. Pilz3. Rockwell AutomationSafety Controllers/Modules/Relays1. Pilz2. Omron Industrial Automation3. SICKSafety Interlock Switches1. Schmersal2. Rockwell Automation3. Siemens Industrial Automation Two-Hand Safety Controls1. Banner Engineering2. Break-A-Beam3. Rockwell AutomationKey Factors for SuccessVendors interviewed in this study were asked what they regard as key factors for their ongoing success in the machine automatic safeguarding product businesses they are in. A large number of factors were identified, reflecting where the various vendors are in the market and what they consider most important for them given their position. Overall, most identified were availability/ delivery, cost control to achieve competitive prices, high-quality/-reliability products, ongoing product innovation, and strong customer service/support.ABOUT THE STUDYProduct FocusYear 2006 and 2007 worldwide shipments (in U.S $ volume and units) and average selling prices are provided for each of the 27 product types studied, along with forecast shipments and average selling prices through 2012.Year 2007 and forecast 2012 shipments are provided for each of the product types to markets in the Americas, EMEA, and Asia-Pacific regions. The following 2007 world and major regional market segmentations and 2012 forecasts are provided separately for the stand alone safety PLCs and those integrated with machine controllers (a common CPU): * Shipment shares between CPU controllers, I/O modules in controller chassis, and distributed remote I/O* Shipment shares of distributed/remote I/O between block and modular products* The shipments and forecasts of the programmable safety systems are segmented by the bus/network types used: AS-I Safety at Work, CC-Link Safety, DeviceNet Safety, Ethernet/IP Safety, GuardPLC Ethernet, PROFIsafe, PROFInet Safety, safeEthernet, SafetyBUS p, and others.Consuming Industries and ApplicationsYear 2007 and forecast 2012 shipments to world and major region markets are provided for each of the product types segmented by the following consuming industries and applications as appropriate:* Consuming Industries: appliance, automotive, chemical, electric power, electronic components, electronic products, food and beverage, oil and gas, paper converting, petrochemical, pharmaceutical, plastics/rubber, primary metals, semiconductor, textile, and other.* Consuming Applications: assembly, material handling, metal working, packaging, robotics, welding, and other.Channels of DistributionYear 2007 world and major regional markets for each of the product types under study are segmented by the following distribution channels:Sales OrganizationsShares of sales made by vendor field sales personnel, vendor inside sales personnel, manufacturer’ representatives and agents, over the Internet, and other means (orders by e-mail, fax, mail, phone, etc.).Customer ClassesSales shares to following customer classes: distributors, end users, OEMs, private label resellers, and systems integrators. Current and Emerging User NeedsAnalyses are presented of user (end users, OEMs, systems integrators and others) needs including:* Ranking of Applications for Machine Automatic Safeguarding Product Types* Reasons for Purchasing Machine Automatic Safeguarding Products* Current and Future Use of Lock-Out/Tag-Out Versus Machine Automatic Safeguarding* Key Product Selection Criteria* Safety Standard Organization Requirements* Key “Non-Product” or “Commercial” Vendor Selection Criteria* End User Needs for Risk Assessments and Site Audits* Firms Conducting Risk Assessments and Site Audits* Organizations Doing Installations* Organizations Providing Servicing* Services Obtained From Third Party Sources Relative To Machine Automatic Safeguarding* Sources of Information on Machine Automatic Safeguarding Products and Vendors that are Used* Trade Periodicals Used to Obtain Information on Products & Vendors* Trade Shows Where Users Obtain Information on Products & VendorsSafety Standard Requirements and TrendsThe most significant safety standard organizations covering machine automatic safeguarding requirements in the major regional markets are described. Current requirements are described along with evolving requirements, and the efforts to “harmonize” worldwide standards. Vendor AnalysesVendor 2007 shipments to worldwide and major regional markets are given for each of the product types under study, along with market shares. Information is provided on consolidations and other changes going on in the machine automatic safeguarding equipment industry.Key success factors identified by vendors are covered.Profiles are provided on 25 major vendors of machine automatic safeguarding products serving worldwide markets. These include: corporate overview, product shipments, manufacturing locations and other sources of products, geographic markets served, applications & industries served, distribution channels, strategic direction and outlook. The names, addresses, phone numbers, and Web sites of machine automatic safeguarding product vendors are listed in the Appendix of the report.Strategies and RecommendationsBased on the study findings, VDC presents recommendations on how machine automatic safeguarding equipment vendors can enhance their competitive position worldwide, and in the major regional markets. These include recommendations and strategies regarding: types of product offerings, product characteristics and features, pricing, safety standards and requirements, geographic markets, application and industry markets, channels of distribution, promotion, customer education, and other success factors.
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