The market for gas sensors is increasing significantly with various local, regional, and global players, contributing a significant share to the growth of the global gas sensor market. The players are focusing on gaining a strategic advantage over their competitors by innovating and developing affordable, reliable, accurate, and cost-efficient gas sensors. As per a study conducted by Wantstats, MSA Safety, Inc., New Cosmos Electric Co., Ltd., AMS AG, Amphenol Corporation, and Sensirion AG are among the major players operating in the global gas sensor market.
MSA Safety, Inc. is a manufacturer and provider of safety products for individuals as well as facilities. The company’s ALTAIR series of gas detectors undergo several quality checks, which ensures the products are of high-quality, reducing the maintenance and total cost of ownership for customers.
New Cosmos Electric Co., Ltd. is a Japanese manufacturer of gas sensors, alarms, and detectors. The company’s gas detection systems have been used in several industrial and commercial applications across Japan and other Asian countries. Thus, the company holds a significant share of the market in Asia. The company also focuses on expanding its business across the globe by adopting inorganic growth approaches.
AMS AG provides sensors and interfaces for consumer, industrial, medical, mobile communications, and automotive markets. The company specializes in developing portable gas sensors for indoor air quality monitoring and VOC detection. This has enabled the company to attract customers from the residential and commercial sectors.
Amphenol Corporation is engaged in manufacturing and providing carbon dioxide (CO2) sensors for several industry verticals. The company is focusing on developing sensors that can detect toxic gas to ensure air quality across facilities. This has prompted the company to invest in research & development, ensuring it has a strategic advantage in the global gas sensor market.
Sensirion AG is engaged in the provision of digital microsensors and systems. The company offers a diversified portfolio of gas and liquid flow sensors, differential pressure sensors, and environmental sensors. Moreover, the company is focused on the development of sensors that can determine oxygen and laughing gas levels for industrial safety. It is also focusing on developing a reliable distribution channel by maintaining strategic partnerships with its distributors and resellers.
Michael Porter’s Five Forces model provides a framework to study the global gas sensor market. Strategic business managers trying to gain an edge over competing firms in the global gas sensor market can utilize this model to better understand the industry in which the firm operates. The components of each of the forces and the degree of impact of each component in the context of the global gas sensor market have been broken down and analyzed.
THREAT OF NEW ENTRANTS
The global gas sensor market has high growth potential. The capital investments and technology required for entering the market are low to moderate. However, the requirement of technical expertise for developing gas sensing technology is considerably high. Furthermore, the key players in the market have patented most of their technology, which further increases the barriers for the new players to enter the market. Therefore, the new entrants are expected to present a low threat to the major competitors in the market during the forecast period.
BARGAINING POWER OF SUPPLIERS
In the global gas sensor market, the suppliers provide raw materials with limited material differentiation; they abide by the standardization regulations laid down by government authorities. The raw material suppliers who offer silicon wafers, PLC, filters, electrodes, insulators, photodetectors, and diodes are usually third-party vendors that work on a contractual basis and are present in moderate concentration. Also, sensor manufacturers enter into long-term contracts with material suppliers. These factors make the cost of switching between suppliers moderate. Therefore, the bargaining power of suppliers in the market is expected to be moderate during the forecast period.
THREAT OF SUBSTITUTES
The electronics and semiconductor industry is widely established with the presence of a large number of OEMs and component suppliers. Furthermore, there exist several opportunities in the gas sensing technology, which has led to a continuous increase in the end-use applications of gas sensors. Therefore, it is improbable that any other rapidly emerging technology would replace these during the forecast period. Hence, the threat of substitutes is expected to be low.
BARGAINING POWER OF BUYERS
The concentration of buyers in the global gas sensor market is high, owing to a large number of end-use applications. This restricts the bargaining power of the buyers. However, the buyers are well-established industries such as automotive, transportation, oil & gas, water and wastewater, food & beverages, metals & chemicals, and consumer electronics that have officials with high technical expertise and they mainly opt for large volumes of standardized, high-quality products. They dictate the specification and type of products required, which increases their bargaining power. Furthermore, the impact of brand recognition is high, which further raises the bargaining power of the buyers. Therefore, the bargaining power of buyers in the market is expected to be moderate to high.
INTENSITY OF RIVALRY
The demand for gas sensors is high with a limited presence of manufacturers; therefore, the rivalry among the market players such as Honeywell International Inc., MSA Safety Incorporated, Amphenol Corporation, Figaro Engineering Inc., AMS AG, Membrapor AG, and Sensirion AG is high. Also, the key market players are investing extensively in research and development, filing patents for gas sensing technologies to enhance product differentiation. Therefore, the market is expected to register a high degree of rivalry among the existing players during the forecast period.
