Metrology Services Market: Table of Content

Global Metrology Services Market 2012 – 2018

Transparency Market Research 1

Metrology Services Market: Global Industry Analysis, Size, Share,

Growth, Trends and Forecast, 2012 – 2018

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Table of Content

Chapter 1 Preface .............................................................................. 10

1.1 Report description ....................................................................................................... 10

1.2 Research scope ............................................................................................................ 12

1.3 Research methodology ................................................................................................ 13

Chapter 2 Executive Summary ......................................................... 15

2.1 Global metrology services market, size and Y–o–Y growth, 2012 – 2018 (USD million) ........................................................................................................................ 15

2.2 Global metrology services market snapshot ................................................................. 17

Chapter 3 Global Metrology Services Market Overview ................ 18

3.1 Market definition ......................................................................................................... 18

3.2 Market trends and future outlook, 2012 – 2018 ........................................................... 18

3.3 Factor analysis ............................................................................................................. 20

3.3.1 Market drivers .................................................................................................... 20

3.3.1.1 Rising adoption of CAD/CAM and international quality standards ....................................................... 20

3.3.1.2 Shortage of skilled precision machine operators ............. 20

3.3.1.3 Lack of applicability of existing measuring equipments .............................................................. 20

3.3.1.4 Demand to capture large volumes of 3-D data for modeling and analysis ................................................ 21

3.3.1.5 Growing pressure on global infrastructure and resources ................................................................. 21

3.3.2 Restraints ........................................................................................................... 22

3.3.2.1 Lack of a universal system that can be applied across different sectors .............................................. 22

3.3.2.2 High risk of changes in regional market growth trend and potential ............................................................ 22

3.3.3 Opportunities ..................................................................................................... 23

3.3.3.1 Growing outsourcing trend for dimensional inspection in medical sector ........................................ 23

3.3.3.2 Market development in emerging economies ................. 23

3.4 Value chain analysis ..................................................................................................... 24

3.5 Global metrology services market attractiveness ......................................................... 27

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3.5.1 Global metrology services market attractiveness, by product, 2011 .................... 27

3.5.2 Global metrology services market attractiveness, by geography, 2011 ................ 28

3.5.3 Global metrology services market attractiveness, by end-use sector, 2011 .......... 29

3.6 Porter’s five force analysis ........................................................................................... 30

3.6.1 Bargaining power of suppliers ............................................................................. 30

3.6.2 Bargaining power of buyers ................................................................................ 31

3.6.3 Threat from new entrants ................................................................................... 31

3.6.4 Threat from substitutes ...................................................................................... 32

3.6.5 Degree of competition ........................................................................................ 32

Chapter 4 Global Metrology Services Market, by Products ........... 33

4.1 Introduction................................................................................................................. 33

4.1.1 Comparative analysis of global metrology services market, by products, 2012 & 2018 (value %) ........................................................................................ 33

4.2 Coordinate measuring machines (CMM) services ......................................................... 34

4.2.1 Global CMM services market, size and forecast, 2011 – 2018 (USD million) ......... 34

4.2.2 Gantry machines services ................................................................................... 36

4.2.2.1 Global gantry machines services market, size and forecast, 2011 – 2018 (USD million) ............................ 36

4.2.3 Bridge machines services .................................................................................... 37

4.2.3.1 Global bridge machines services market, size and forecast, 2011 – 2018 (USD million) ............................ 37

4.2.4 Articulated arm machines services ...................................................................... 38

4.2.4.1 Global articulated arm machines services market, size and forecast, 2011 – 2018 (USD million) ................ 38

4.2.5 Horizontal arm machines services ....................................................................... 39

4.2.5.1 Global horizontal arm machines services market, size and forecast, 2011 – 2018 (USD million) ................ 39

4.3 Optical digitizers and scanners services ........................................................................ 40

4.3.1 Global Optical Digitizers and Scanners services market, size and forecast, 2011 – 2018 (USD million) ................................................................................... 41

4.3.2 Three dimensional (3D) laser scanners services ................................................... 42

4.3.2.1 Global three dimensional (3D) laser scanners services market, size and forecast, 2011 – 2018 (USD million) ............................................................ 42

4.3.3 White light scanners services .............................................................................. 43

4.3.3.1 Global white light scanners services market, size and forecast, 2011 – 2018 (USD million) ...................... 43

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4.3.4 Laser trackers services ........................................................................................ 44

4.3.4.1 Global laser trackers services market, size and forecast, 2011 – 2018 (USD million) ............................ 44

Chapter 5 Global Metrology Services Market, by End-user Applications...................................................................... 45

5.1 Introduction................................................................................................................. 45

5.1.1 Comparative analysis of global metrology services market, by applications, 2012 & 2018 (value %) .................................................................... 46

5.2 Metrology services market in automotive applications ................................................ 47

5.2.1 Global metrology services market in automotive applications, 2011 – 2018 (USD million) ...................................................................................................... 47

5.3 Metrology services market in aerospace applications .................................................. 48

5.3.1 Global metrology services market in aerospace applications, 2011 – 2018 (USD million) ...................................................................................................... 48

5.4 Metrology services market in industrial applications ................................................... 49

5.4.1 Global metrology services market in industrial applications, 2011 – 2018 (USD million) ...................................................................................................... 49

5.5 Metrology services market in power generation applications ...................................... 50

5.5.1 Global metrology services market in power generation applications, 2011 – 2018 (USD million) ........................................................................................... 50

5.6 Metrology services market in other applications .......................................................... 51

5.6.1 Global metrology services market in other applications, 2011 – 2018 (USD million) ............................................................................................................... 51

Chapter 6 Global Metrology Services Market, by Geography ....... 52

6.1 Introduction................................................................................................................. 52

6.1.1 Comparative analysis of global metrology services market, by geography, 2012 & 2018 (value %) ........................................................................................ 53

6.2 North America metrology services market ................................................................... 54

6.2.1 North America metrology services market, size and forecast, 2011 – 2018 (USD million) ...................................................................................................... 54

6.3 Europe metrology services market ............................................................................... 55

6.3.1 Europe metrology services market, size and forecast, 2011 – 2018 (USD million) ............................................................................................................... 55

6.4 Asia-Pacific metrology services market ........................................................................ 56

6.4.1 Asia-Pacific metrology services market, size and forecast, 2011 – 2018 (USD million) ...................................................................................................... 56

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6.5 Rest of the world (RoW) metrology services market .................................................... 57

6.5.1 Rest of the world (RoW) metrology services market, size and forecast, 2011 – 2018 (USD million) ................................................................................... 57

Chapter 7 Key Competitors Analysis ............................................... 58

7.1 Market share of major players, 2012 ............................................................................ 58

7.1.1 Global metrology services market share by major players, 2012 (value %) .......... 58

7.2 Competitive strategies adopted by major players ........................................................ 59

Chapter 8 Company Profiles ............................................................. 60

8.1 Hexagon AB ................................................................................................................. 60

8.1.1 Company overview ............................................................................................. 60

8.1.2 Financial overview .............................................................................................. 60

8.1.3 Business strategies ............................................................................................. 61

8.1.4 Recent developments ......................................................................................... 62

8.2 Optical Metrological Services ....................................................................................... 63



8.2.3 Business strategy ................................................................................................ 63


8.3 Danish Micro Engineering A/S ...................................................................................... 65




8.3.4 Recent development ........................................................................................... 65

8.4 FARO Technologies, Inc. ............................................................................................... 66





8.5 Optical Gaging Products, Inc ........................................................................................ 68





8.6 Renishaw Plc. ............................................................................................................... 70

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8.7 Nikon Metrology Inc. ................................................................................................... 72





8.8 Carl Zeiss Corporation .................................................................................................. 74





8.9 Trescal SA .................................................................................................................... 76





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List of Figures FIG. 1 Global metrology services market, size and Y–o–Y growth, 2011 – 2018 (USD

million) 15FIG. 2 Global metrology services market: Value chain analysis 24FIG. 3 Global metrology services market attractiveness, by product, 2011 27FIG. 4 Global metrology services market attractiveness, by geography, 2011 28FIG. 5 Global metrology services market attractiveness, by end-use sector, 2011 29FIG. 6 Global metrology services market: Porter’s five forces analysis 30FIG. 7 Global metrology services market share, by products, 2012 & 2018 (value %) 33FIG. 8 Global Coordinate Measuring Machines services market, size and forecast, 2011 –

2018 (USD million) 35FIG. 9 Global gantry machines services market, size and forecast, 2011 – 2018 (USD

million) 36FIG. 10 Global bridge machines services market, size and forecast, 2011 – 2018 (USD

million) 37FIG. 11 Global articulated arm machines services market, size and forecast, 2011 – 2018

(USD million) 38FIG. 12 Global horizontal arm machines services market, size and forecast, 2011 – 2018

(USD million) 39FIG. 13 Global Optical Digitizers and Scanners services market, size and forecast, 2011 –

2018 (USD million) 41FIG. 14 Global three dimensional (3D) laser scanners services market, size and forecast,

2011 – 2018 (USD million) 42FIG. 15 Global white light scanners services market, size and forecast, 2011 – 2018 (USD

million) 43FIG. 16 Global laser trackers services market, size and forecast, 2011 – 2018 (USD

million) 44FIG. 17 Global metrology services market, by applications, 2012 & 2018 (value %) 46FIG. 18 Global metrology services market in automotive applications, 2011 – 2018 (USD

million) 47FIG. 19 Global metrology services market in aerospace applications, 2011 – 2018 (USD

million) 48FIG. 20 Global metrology services market in industrial applications, 2011 – 2018 (USD

million) 49FIG. 21 Global metrology services market in power generation applications, 2011 – 2018

(USD million) 50FIG. 22 Global metrology services market in other applications, 2011 – 2018 (USD million) 51FIG. 23 Global metrology services market, by geography, 2012 & 2018 (value %) 53FIG. 24 North America metrology services market, size and forecast, 2011 – 2018 (USD

million) 54FIG. 25 Europe metrology services market, size and forecast, 2011 – 2018 (USD million) 55

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FIG. 26 Asia-Pacific metrology services market, size and forecast, 2011 – 2018 (USD million) 56

FIG. 27 Rest of the world (RoW) metrology services market, size and forecast, 2011 – 2018 (USD million) 57

FIG. 28 Global metrology services market revenue share by major players, 2012 (value %) 58FIG. 29 Hexagon AB annual revenues, 2010 – 2012 (USD million) 61FIG. 30 FARO Technologies, Inc annual revenues, 2010 – 2012 (USD million) 66FIG. 31 Renishaw PLC. annual revenues, 2010 – 2012 (USD million) 70FIG. 32 Nikon Corporation annual revenues, 2010 – 2012 (USD million) 73FIG. 33 Carl Zeiss Corporation annual revenues, 2010 – 2012 (USD million) 75

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List of Tables

TABLE 1 Global metrology services market snapshot, 2012 & 2018 17TABLE 2 Global metrology services market, by products, 2011 – 2018 (USD million) 33TABLE 3 Global CMM services market, by products, 2011 – 2018 (USD million) 34TABLE 4 Global ODS services market, by products, 2011 – 2018 (USD million) 40TABLE 5 Global metrology services market, by end-user applications, 2011 – 2018 (USD

million) 45TABLE 6 Global metrology services market, by geography, 2011 – 2018 (USD million) 52TABLE 7 Regional GDP (PPP) growth, 2008 – 2011 (%) 57

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Chapter 1 Preface

1.1 Report description

The research report on global metrology services market provides detailed analysis of global

market for the period 2012 to 2018 and helps in understanding the driving forces and prevailing

trends in the market. The report segments market based on its major product segments,

applications, and major geographical regions. The report provides market size and forecast for

market segments and explains the impact of various factors on the global metrology market.

Metrology is the science of measurement which deals with measurement of any parameter and

includes both theoretical and experimental aspects of measurements determined at any level of

uncertainty. Metrology enables an end user to measure any object, with respected to different

parameters, as well as it facilitates in identifying production errors

The market under consideration is divided into sub-segments based on various parameters, so

as to enable stakeholders across the supply chain take advantage of strategic analyses

included in the report. Various sub segments which are identified and analyzed are:

Market segments by product type

Coordinate Measuring Machines (CMM)

o Gantry machines

o Bridge machines

o Articulated arm machines

o Horizontal arm machines

Optical Digitizers and Scanners (ODS)

o 3D laser scanners

o White light scanners

o Laser trackers

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Market segments by applications

Automotive

Aerospace

Industrial

Power generation

Others (medical and electronics)

Market segments by geography

North America

Europe

Asia-Pacific

Rest of the world (Latin America, Middle East and Africa)

Apart from the above cross sectional analysis of the global metrology services market, the

report also includes competitive profiling of key industry participants, their market positioning,

business strategies adopted by them, and various recent developments. Porter‘s five forces

analysis further highlights competitive scenarios across different levels of supply chain. In all,

the report provides a strategic analysis of the global metrology services market, with estimates

for each of the segments mentioned above, in terms of revenue (USD million), across six years

of forecast period, 2012 – 2018, considering 2011 as the base year.

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1.2 Research scope

This section identifies and defines various constraints and binding parameters, which were

observed while providing the market estimates and the analysis. The metrology services market

here refers to the services such as outsourcing, calibration services, and installation services

among others provided for all the product segments. The different applications covered under

this research study are defined as follows:

Automotive – The segment includes all the participants involved in the automotive

supply chain including the OEMs and the component manufacturers

Aerospace – The segment includes metrology services offered to civil aerospace,

military, and defense applications

Industrial – The segment includes metrology services offered to all industrial

manufacturing applications, metal fabrication work, and processing industries

Power generation – The segment includes the analysis of metrology services provided

in thermal power plants, nuclear plants, and wind mills, and other renewable power

generation sources

Others – The segment includes metrology services provided in electronics, medical,

heritage preservation, and animation applications among others

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1.3 Research methodology

For the research report, we had conducted in-depth interviews and discussions with a wide

range of key industry participants and opinion leaders. Primary research represented the bulk of

our research efforts, supplemented by extensive secondary research. We reviewed the key

players’ product literature, annual reports, press releases and relevant documents for

competitive analysis and market understanding. Secondary research also included a search of

recent trade journals, technical writing, internet sources and statistical data from government

websites, trade associations and agencies. This approach had proven to be the most reliable,

effective and successful approach for obtaining precise market data, capturing industry

participants’ insights, and recognizing business opportunities.

Secondary Research

The secondary research sources that were referred to include, but are not limited to:

Company websites, annual reports, financial reports, broker reports, investor

presentations and SEC filings

Industry trade journals, scientific journals and other technical literature

Internal and external proprietary databases, relevant patent and regulatory databases

National government documents, statistical databases and market reports

News articles, press releases and web-casts specific to the companies operating in the

market

Primary Research

We conducted primary interviews on an ongoing basis with industry participants and

commentators in order to validate data and analysis. A typical research interview fulfilled the

following functions:

It provided first-hand information on the market size, market trends, growth trends,

competitive landscape, future outlook, etc.

Helped in validating and strengthening the secondary research findings

Further developed the Analysis Team’s expertise and market understanding

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Primary research involved E-mail interactions, telephonic interviews as well as face-to-

face interviews for each market, category, segment and sub-segment across

geographies

The participants who typically took part in such a process include, but are not limited to:

Industry participants: CEOs, VPs, marketing/product managers, market intelligence

managers and national sales managers

Purchasing managers, technical personnel, distributors and resellers

Outside experts: Investment bankers, valuation experts, research analysts specializing

in specific markets

Key opinion leaders specializing in different areas corresponding to different industry

verticals

Models

Where no hard data was available, we used data modeling and estimate in order to produce

comprehensive data sets. A rigorous methodology was adopted in which the available hard data

was cross referenced with the following data types to produce estimates:

Demographic data: Population split by segment

Macro-economic Indicators: GDP, inflation rate, etc.

Industry Indicators: Expenditure, technology stage & infrastructure, sector growth and

facilities

Data was then cross checked by the expert panel

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Chapter 2 Executive Summary

The global metrology services market is driven by recovery of industrial verticals from the

economic downturn. It is going through paradigm shift and new trends are observed across

different industry verticals including automotive sector, defense, and aerospace, worldwide. The

market was valued at USD xxx million in 2012, recording a growth of xx% from that in 2011. It is

further forecast to exceed USD xxx million by 2018 at a CAGR of xx% from 2012 to 2018.

2.1 Global metrology services market, size and Y–o–Y growth, 2012 – 2018 (USD million)

FIG. 1 Global metrology services market, size and Y–o–Y growth, 2011 – 2018 (USD million)

Source: Company annual reports, Industrial journals, Technical publications, TMR analysis *Y-o-Y: Year-

on-Year

Post economic slowdown in 2009, there has been substantial shift in global economic growth

patterns. The focus shifted from American and European markets to Asia-Pacific markets, but

also new verticals such as automobile industry, aerospace and power generation have emerged

as key segments. Technological developments too are influencing the growth, and new product

development has become a significant strategy for many industrial players. There are many new

and small players entering the market making the environment competitive. High installation and

420.

9

6.5%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

0

100

200

300

400

500

600

700

800

2011 2012 2013 2014 2015 2016 2017 2018

Revenue (USD Million) YoY Growth (%)

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operations cost of metrology products is pushing up the demand for metrology services, with

small and medium sized business being key buyers.

Optical Digitizers and Scanners (ODS) provides better measurement of difficult geometries with

touch probe accuracy. As a result of continuous technological developments taking place in the

industry, Optical Digitizers and Scanners (ODS) services are growing at a higher rate as

compared to Co-ordinate measuring machines services. Among different ODS services; the

demand for 3D laser scanners is highest due to high preciseness and better accurate results

offered. Laser tracker metrology services market accounted for xx% of ODS market in 2012 and

was the largest service segment. Laser tracker services market is forecast to exceed USD xx

million by 2018 at a CAGR of xx% from 2012 to 2018. CMM services market is seeing a gradual

decline in market share due to fast growth of ODS segments. Factors such as growing demand

for accurate and 3 Dimensional measurements are key causes for the decline. Moreover

inability to measure big/huge components yet again pushes buyers to opt for ODS services.

By end use sector, industrial and automotive sector are the leading revenue contributors and

collectively accounted xx% of the global metrology services market size in 2012. Growth in

industrial output and need to optimize production process is driving the market growth. Asia-

Pacific region owing to its strong customer base is expected to surpass Europe as biggest

regional market by 2018. Due to emerging opportunities and fragmented nature of market,

players are focusing on new product development and mergers and acquisitions as growth

strategies.

Companies such as Hexagon, Carl Zeiss, FARO Technologies, and Trescal are among the

global leaders and technology pioneers in the market. One such trend has been witnessed

when Trescal acquired Dynamic Technology Inc. The move not only helped Trescal to enter U.S

market, but also expand its product and services offerings. The snapshot below highlights key

trends of the global metrology services market.

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2.2 Global metrology services market snapshot

TABLE 1 Global metrology services market snapshot, 2012 & 2018

Particulars 2012 2018

Market Size USD xxx million USD xxx million

Growth (CAGR) xx% (2012 – 2018)

Major players in the market, 2012

Nikon Corporation, Carl Zeiss Group, Renishaw, Trescal, Inc., FARO Technologies, Inc., Hexagon AB, and Mitutoyo Corporation, among others

Product Type

Coordinate Measuring Machines – USD xxx million Gantry Machines – USD xxx million Bridge Machines – USD xxx million Articulated Arm Machines – USD xxx million Horizontal Arm Machines – USD xxx million Optical Digitizers and Scanners – USD xxx million 3D laser scanners – USD xxx million White light scanners – USD xxx million Laser trackers – USD xxx million

Coordinate Measuring Machines – USD xxx million Gantry Machines – USD xxx million Bridge Machines – USD xxx million Articulated Arm Machines – USD xxx million Horizontal Arm Machines – USD xxx million Optical Digitizers and Scanners – USD xxx million 3D laser scanners – USD xxx million White light scanners – USD xxx million Laser trackers – USD xxx million

Application segments

Automotive – USD xxx million Aerospace – USD xxx million Industrial – USD xxx million Power generation – USD xxx million Others – USD xxx million

Automotive – USD xxx million Aerospace – USD xxx million Industrial – USD v million Power generation – USD xxx million Others – USD xxx million

Geographic segments

North America – USD xxx million Europe – USD xxx million Asia-Pacific – USD xxx million RoW – USD xxx million

North America – USD xxx million Europe – USD xxx million Asia-Pacific – USD xxx million RoW – USD xxx million

Key growth factors

Demand to capture large volumes of 3-D data for modeling and analysis Lack of applicability of conventional measuring equipments Shortage of skilled precision machine operators Rising adoption of CAD/CAM and international quality standards

Growing pressure on global infrastructure and resources Source: Company annual reports, trade journals, industrial publications, TMR analysis

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Chapter 3 Global Metrology Services Market Overview

3.1 Market definition

Metrology is defined as measurement of objects. This field of science has found increased

applications across different industry verticals and is witnessing dynamic shifts in growth trends.

It helps manufacturers to increase their efficiency by optimizing productivity without significantly

affecting the resource requirements. Different metrology products can be used independently or

as integrated systems for functions such as measurement (3D), quality control or inspection,

reverse engineering, product quality optimization, or to minimize need of reworks, and reduce

scrap/waste generation during the manufacturing process. However, considering the high cost

of such precision equipments, it becomes financially challenging for manufacturers to be able to

keep their inventory at par with technological developments resulting in new product introduction

in the market. This has given rise to service sector, wherein third party vendors are outsourced

the instrumentation and measurement section. The metrology services market is broadly

categorized into product segments as: Coordinate Measuring Machines (CMM) and Optical

Digitizers and Scanners (ODS). The global market for metrology services was valued at USD

xxx million in 2011 and is forecast to grow by xx% during the six years of forecast period 2012 –

2018.

3.2 Market trends and future outlook, 2012 – 2018

Global metrology services market is driven by recovery of different industry verticals such as

automotive sector, electronics industry, and power generation among others from the economic

downturn. The focus of growth shifted from North America and European markets to Asian

markets, along with the emergence of new verticals such as Medical and Academic, as key

segments. The rapidly booming automotive industry in Asia-Pacific is one of the major

contributors to the growth of metrology services market in the region. Technological

developments, too, are influencing the growth patterns, and new product development has

become a significant strategy for many industrial players. The entry of new players in recent

years has made metrology market fragmented in nature. Despite the entry of large number of

small players making the environment competitive, there are very few players dominating global

markets. Key trends observed in metrology market are as follows:

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3.3 Factor analysis

Growth across different metrology services market segments and sub-segments is influenced

by different macro and micro-economic factors, which are discussed below under appropriate

categories, namely: drivers, restraints and opportunities.

3.3.1 Market drivers

Drivers are factors which directly or indirectly contribute to market growth. These factors

determine market potential and near future growth prospects. Key drivers are discussed below:

3 .3 .1 .1 R is ing adopt ion o f CAD/C AM and i n te rna t iona l qua l i t y s tandards

Manufacturers are increasingly adopting Computer Aided Design and Computer Aided

Manufacturing (CAD/CAM) based processes to the manufacturing cycle for perceived benefits

such as cost reduction, shorter production cycle, reduced defects, and overall operational

efficiency. Manufacturers are also adopting internationally accepted quality standards such as

QS-9000, ISO-9001, Six Sigma, so as to meet requirements of global clients. This calls for more

stringent regulations and quality processes to be brought in place, which can be achieved by

use of metrology products. However, owing to higher operations cost and initial investment,

manufacturers tend to rely on metrology service providers. These service providers offer

services such as calibration, quality control and so on. This is driving the demand for metrology

services.

3 .3 .1 .2 Shor tage o f sk i l l ed p rec is ion mach ine opera to rs

Operating a metrology product efficiently requires skilled workforce. The availability of skilled

machine operators is limited. The user has to invest in hiring a skilled machine operator thus

adding to the operation cost. Outsourcing such operations to third party vendors is an

economical alternative. This is thus driving the demand for metrology services in the market.

3 .3 .1 .3 Lack o f app l i cab i l i t y o f ex i s t ing measur ing equ ipments

Conventional measuring equipments are not able to address concerns such as throughput,

accuracy, and efficiency. The situation becomes even more adverse for large components such

as automobile parts, factory retrofits, construction equipments, aircraft parts, and other such

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3.4 Value chain analysis

Metrology services market is in nascent stage in Asia-Pacific and RoW region. Players in the

metrology market are adapting themselves to changing demands and introducing new products

and services. However, with rising competition and many players operating in the market, there

is need for value addition across the entire supply chain, so as individual organizational growth

targets can be achieved.

FIG. 2 Global metrology services market: Value chain analysis

Source: Industrial journals, Technical publications, TMR analysis

Inbound Logistics

•Large number of suppliers•Quaity is a major challenge•lack of comprehensive solution providers

Operations

•Need for integrated solutions•Cost effective solutions in demand

Outbound Logistics

•Real time services•Demand for precise, accurate, and reliable solutions

Marketing & Sales

•Requirement of strong distribution network

Services

•Demand for custom solutions•Use ofadvanced technologies

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3.5 Global metrology services market attractiveness

Analysis of metrology services market based on different parameters, such as product type,

geography and end-use sector, reveals that automotive sector especially in Asia-Pacific region

has high growth potential, with ODS segment being the most attractive market.

3.5.1 Global metrology services market attractiveness, by product, 2011

Among different ODS products and services, White light scanners and laser trackers are in high

demand due to their high precision and accuracy. Thus, laser scanners and articulated arm

machines are most attractive markets among all product types. However, among CMM products

and services, articulated arm machines and bridge machines are still in demand and have high

growth potential.

FIG. 3 Global metrology services market attractiveness, by product, 2011

Source: Industrial journals, Technical publications, TMR analysis Note: Bubble size represents market size

in 2011

Mar

ket G

row

th (%

)

Market Attractiveness

Gantry Machines Bridge Machines Articulated Arm Machines Horizontal Arm Machines3D laser scannners White light scanners Laser trackers

Low Medium High

Laser trackers is most attractive market due to its high accuracy and efficiency

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3.6 Porter’s five force analysis

Porter’s five force analysis provides the analysis of different influential factors at various levels

of the supply chain which affect the market growth trends. Below figure depicts the impact of

Porter’s five forces on different parameters and the market competitiveness.

FIG. 6 Global metrology services market: Porter’s five forces analysis

Source: Trade journals, Technical publications, TMR analysis

3.6.1 Bargaining power of suppliers

The bargaining power of suppliers will change from medium to low. The suppliers to the

metrology services market are the raw material suppliers to the metrology equipment

manufacturers. They are players from fields such as IT, semiconductors, sensors, display, and

so on. There are a less number of suppliers in present scenario; however, the number is

expected to increase in near future with the entry of more number of players in metrology

services market providing potential opportunities to these suppliers. Also, current suppliers

compete with each other to provide quality raw materials to the metrology equipment

manufacturers to keep upper-hand in the market. Some of the leading metrology equipment

manufacturers and services providers include Hexagon Metrology, Carl Zeiss, and Mitutoyo

Changing consumer demands Stringent quality standards High skilled labor for installation and usage Limited price range Increasing industrial usage in developing

regions

Degree of CompetitionLow Medium

Threat of substitutesMedium High

Threat of New EntrantsHigh Medium

Bargaining Power of BuyersMedium Medium

Bargaining Power of SuppliersMedium Low

Less number of suppliers Demand for quality raw materials Limited technology Limited price range

High quality assurance High skilled labor High installation price Stringent quality products (especially for

medical devices), as defined by government Increasing industrial usage in developing

regions

No compatible external substitutes availablecurrently

Ongoing research and development activities Threat from improved products in existing line Risk of customers opting for product

installation

High price for ODS products Higher number of distributors quoting varing

prices Required high skilled labor for usage

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Chapter 4 Global Metrology Services Market, by Products

4.1 Introduction

Global metrology services market is segmented in two major product segments as Coordinate

Measuring Machines and Optical Digitizers and Scanners. ODS is the largest product segment

that accounted for around xx% market share in 2012 and is expected to increase its share by

2018, growing at a CAGR of xx% during the forecast period. 3D laser scanners is the largest

product segment in ODS market. CMM is expected to lose a share of xx% by 2018 as

compared to 2012 (xx%).

TABLE 2 Global metrology services market, by products, 2011 – 2018 (USD million)

Product Type 2011 2012 2013 2014 2015 2016 2017 2018 CAGR (%)

2012 - 2018

CMM 176.8 xxx xxx xxx xxx xxx xxx xxx xxx

ODS 244.1 xxx xxx xxx xxx xxx xxx xxx xxx

Global 420.9 xxx xxx xxx xxx xxx xxx xxx xxx

Source: Company annual reports, trade journals, industrial publications, TMR analysis

4.1.1 Comparative analysis of global metrology services market, by products, 2012 & 2018 (value %)

FIG. 7 Global metrology services market share, by products, 2012 & 2018 (value %)


2012

Coordinated Measuring Machines

Optical Digitizers and Scanners

2018

Coordinated Measuring Machines

Optical Digitizers and Scanners

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4.2.3 Bridge machines services

The bridge machine is a type of Coordinate Measuring Machine that has a horizontal frame

supported by two vertical columns. The machine arm is vertically suspended to measure the

work piece. The bridge type CMM is the largest segment and accounts for around xx% share of

the total CMM market. The growing demand from automotive, aerospace, and defence

industries will gradually increase the share and demand for bridge type CMM in upcoming

years.

4 .2 .3 .1 G loba l b r idge mach ines se rv ices marke t , s i z e and fo recas t , 2011 – 2018 (USD mi l l ion )

The global bridge machines market in 2011 was valued at USD xxx million in 2011 and USD xxx

million in 2012. It is further expected to grow at a CAGR of xx% during the forecast period from

2012 to 2018 and reach the market size of USD xxx million by 2018.

FIG. 10 Global bridge machines services market, size and forecast, 2011 – 2018 (USD million)


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Chapter 5 Global Metrology Services Market, by End-user Applications

5.1 Introduction

Application segment comprises of automotive, aerospace, industrial, power generation, and

medical and electronics. In present scenario, demand for information and automation systems is

increasing due to higher reliability; superior quality, reduced cost of services and repeatability.

Metrology services helps in process improvement by measuring and inspecting various

elements involved in the supply chain processes such as manufacturing and retrofitting among

others. Due to increasing population, there is increased demand for end products, which leads

manufacturing firms to produce end products in less time with same quality. This further

increases the demand for metrology services in different industries including automotives,

aerospace, power generation, and electronics among others.

TABLE 5 Global metrology services market, by end-user applications, 2011 – 2018 (USD million)


2012 - 2018

Automotive 101.0 xxx xxx xxx xxx xxx xxx xxx xxx

Aerospace 75.8 xxx xxx xxx xxx xxx xxx xxx xxx

Industrial xxx xxx xxx xxx xxx xxx xxx xxx xxx Power generation xxx xxx xxx xxx xxx xxx xxx xxx xxx Others xxx xxx xxx xxx xxx xxx xxx xxx xxx

Global xxx xxx xxx xxx xxx xxx xxx xxx xxx


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5.4 Metrology services market in industrial applications

Metrology services find significant applications in different process industries for measurement

of different machines and end products size such as packaging, cutting, and molding etc, used

or manufactured in various industries. Use of metrology equipments for the measurement helps

in improving the efficiency and accuracy of the machine and provides better operational control.

5.4.1 Global metrology services market in industrial applications, 2011 – 2018 (USD million)

Industrial segment has largest end use market for metrology services and accounted for xx% of

the entire Metrology services market in 2012. The global market for metrology services in

industrial segment was valued USD xxx million and witnessed a growth of xx% to reach USD

xxx million in 2012. It is further expected to increase to USD xxx million by 2018, growing at a

CAGR of xx% from 2012 to 2018.

FIG. 20 Global metrology services market in industrial applications, 2011 – 2018 (USD million)


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Chapter 6 Global Metrology Services Market, by Geography

6.1 Introduction

Growth in metrology services market is primarily contributed by North America and Asia-Pacific

region. Together these regions are forecast to record a market growth of USD xxx million during

the forecast period 2012 – 2018, accounting for xx% of the global metrology services market

growth. Europe, under the impact of debt crisis is witnessing a slow growth (CAGR xx% from

2012 – 2018), with Eastern Europe currently supporting the market growth. Eastern European

countries such as Georgia, Moldova and Kosovo are the leading countries in terms of real GDP

growth. The regional analysis below further highlights growth patterns across respective

regions.

TABLE 6 Global metrology services market, by geography, 2011 – 2018 (USD million)


2012 - 2018

North America 122.8 xxx xxx xxx xxx xxx xxx xxx xxx

Europe 131.8 xxx xxx xxx xxx xxx xxx xxx xxx

Asia Pacific xxx xxx xxx xxx xxx xxx xxx xxx xxx

RoW xxx xxx xxx xxx xxx xxx xxx xxx xxx

Global xxx xxx xxx xxx xxx xxx xxx xxx xxx


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Chapter 7 Key Competitors Analysis

7.1 Market share of major players, 2012

The chart below highlights market share held by leading industry participants in 2012. Hexagon

metrology emerges out as the market leader with a share of xx% and is followed by Carl Zeiss

contributing xx%. However, these players do not enjoy market leadership across all geographic

markets. For instance, European market is dominated by Trescal, which has a well developed

distribution and service network in the region. Similarly, Faro and Hexagon technologies

compete intensely in the U.S market to gain high shares.

Hexagon AB is the market leader in global metrology services market accounting for the share

of xx% followed by Carl Zeiss Group and Mitutoyo Corporation accounting for the respective

market shares of xx% and xx% in 2012. These top three players, together, account for more

than xx% of share of the global metrology services market, which makes the market

oligopolistic.

7.1.1 Global metrology services market share by major players, 2012 (value %)

FIG. 28 Global metrology services market revenue share by major players, 2012 (value %)

Source: Company annual reports, trade and industrial journals, TMR Analysis

Nikon Corporation Carl Zeiss Group RenishawTrescal Inc. FARO Technologies, Inc. Hexagon ABMitutoyo Corporation Others

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Chapter 8 Company Profiles

8.1 Hexagon AB

Hexagon AB (Publ)

P.O. Box 3692

(Street address: Lilla Bantorget 15)

SE-103 59 Stockholm

Sweden

Telephone: +46 8 601 26 20

Fax: +46 8 601 26 21

Website: www.hexagon.com/en/Metrology.htm

8.1.1 Company overview

Hexagon Metrology is a part of the Hexagon AB and is headquartered in UK. The company

offers diverse range of products and services for metrological applications in sectors like

aerospace, automotive, medical and energy. The company markets its products under the

brands like Brown & Sharpe, DEA, CogniTens, Leica Geosystems, PC-DMIS, Leitz, Sheffield,

ROMER and TESA. The company group had around 13,203 employees while the company had

around 4,357 employees by the end of 2012.

8.1.2 Financial overview

The company Hexagon group reported annual revenue of USD xxx million in 2012. The

metrology business of the company accounted for xx% of the revenue generated in 2012.

Geographically, company had Western Europe as its highest earning market, with a revenue

share of xx% followed by North America with a share of xx%.

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FIG. 29 Hexagon AB annual revenues, 2010 – 2012 (USD million)

Source: Company’s annual report 2011 and 2012, Company website

8.1.3 Business strategies

The company is focused on strengthening its brand as well as brand architecture system across

the globe. The company’s brand strategy is in line with its growth strategy that enhances its

profitability and long term sustainability. Research and development is another avenue of

interest for the company and as such company invests heavily in its R&D facilities. In 2012, the

company invested around USD xxx million in its R&D activities. With its robust R&D facilities,

the company aims to renew its product portfolio every 18 months. For expanding its business

operations, the company has adopted aggressive acquisition strategy. Hexagon acquired Mahr

Multisensor GmbH, a leading vision metrology company in 2009 to expand its product offerings

in vision multisensor technology and offer wide range of measuring systems for all industrial

applications.

In last decade, the company implemented as many as 80 acquisitions. The company has

concentrated its efforts in developing competitive cost structure to sustain its market leading

position.

1,98

6.0

2010 2011 2012

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8.1.4 Recent developments

In May 2013, the company announced the renewal of its Innovation Partnership

contract with Red Bull Technologies to consolidate the co-operation between the two

In May 2013, the company announced the launch of its new TESA TLC-TWIN

transceiver designed to enhance performance and offer features to measure with an

ease

In May 2013, the company announced the launch of its new portable gear

measurement solutions. This measurement solution is coupled with QUINDOS

measurement software to measure complex parts examined on complex metrology

devices

In April 2013, the company announced extension of its basic range of multi sensor

portfolio by introducing three new Optiv Classic models of multi-sensors

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