Monday, August 30, 2010

The Korean powerhouse

After traveling 9000 miles in 16 hours, it is a bit much to present, over six days, three seminars on the current state of industrial laser material processing and to rub shoulders with CEOs of the leading South Korean laser system manufacturers. But you do what you have to in this global technology era.

I was pleased to present my views on trends in the industrial laser material technology to several Korean audiences. The main event was participating in the 3rd International Microtech – MEMS Business Conference, a part of Laser Korea 2010. In return I had the opportunity to meet with several of the leading Korean manufacturers of industrial laser systems for both macro and micro processing.

Over the years, Korean laser companies have been reticent in sharing market data with outsiders. On this trip I found these companies more willing to define and quantify their business and markets. I sensed a sort of frustration with some of the CEOs I met with in regard to their peers across the Yellow Sea in China. Several times the comparative size and strength of the Korean suppliers vis-à-vis their counterparts in China were called to my attention.

The upshot is that in my Annual Economic Review I may have been underestimating the size and output of the Korean system manufacturers. While most of the information shared was oral, it wasn’t hard to value the Korean industrial laser system business at $600-$700 million, a figure that surpasses the reported number from China. And more to the point, China, along with Taiwan, are the largest markets for Korean laser system exports.

Because of this newfound cooperation, I expect to tweak my 2010 numbers as I begin to work on this year’s economic report.

Tuesday, August 3, 2010

The sharks are circling

This blogger has been on a bit of a hiatus enjoying some picture perfect vacation weather here in New England. Not that you particularly care but the month of July set temperature records here and we experienced several 90 degree heat waves during the month.

One consequence of this was rising water temperatures that caused the seal population along the Cape Cod coast to increase dramatically drawing the attention of Great White Sharks that also posed threats to salt water enthusiasts.

I’ve just finished compiling data for a review of fiber laser systems used for sheet metal cutting that will appear in the September/October issue of Industrial Laser Solutions. I identified a dozen suppliers that will exhibit flat sheet cutters at one or more of the big international machine tool shows scheduled for the next three months.

What is significant is the growth of the fiber laser as the heat source for this major applications sector. It is estimated that about 100 flat sheet fiber laser cutters were sold in 2009, an accomplishment in a year which saw sales in the entire sector drop by as much as half at some equipment suppliers. Based on my estimate of the 2009 flat sheet laser cutting market, this means the fiber laser now represents about 3% of total sales. And indications are that the unit numbers could double in 2010, especially as these laser systems will be highlighted at the big fabricating shows.

Three new players in this market, Amada/JDSU, TRUMPF and Hypertherm, will create some excitement at these shows, mostly because they will introduce new fiber lasers into the marketplace, posing new competition for industry leader IPG Photonics.

What can come of this is the possibility of significant growth in the fiber laser metal cutting business. Amada and TRUMPF are already among the market leaders with their CO2 powered units and Hypertherm, known for plasma technology, is offering a fiber laser package to system integrators. Whether these sales are pirated from CO2 laser sales remains to be seen, but the thinking is that even if some of this occurs it will not diminish the impact of sales to current non-laser users. There are a large number of shops now cutting sheet metal that have chosen not to invest in laser cutting, chief among these are shops using plasma, which might want to expand into precision cutting of thin gauge stainless steel, for example.. Will they now be tempted by the new fiber laser cutters? Some in the industry are betting on yes.

There are other fiber laser/system suppliers that can also impact the fabricated metal products market when they crank up their promotion. This could happen as this market sector finally recovers from a two year recession that has not, until now, shown the rapid rebound experienced by other industrial laser market sectors.

The temperature of the metal cutting market is rising drawing customers and, like the seals in the waters off the Cape Cod coast attracting sharks, in this case new market entrants ready to challenge the industry leader.