Italians slow to adopt laser welding

Survey finds that the Italian laser welding equipment market earned revenues of $41.8 million in 2004 and estimates to reach $77.7 million in 2011.

Despite a varied application base, the Italian laser welding equipment market currently relies on a very limited number of applications to produce a large proportion of its revenues.

To reduce market volatility and sustain strong growth, market participants will have to encourage the penetration of laser welding technology into new applications.

Frost and Sullivan finds that the Italian laser welding equipment market earned revenues of $41.8 million in 2004 and estimates to reach $77.7 million in 2011.

Currently, Italian laser welding equipment manufacturers are heavily reliant on the automotive sector, particularly the Fiat Group and its suppliers, to generate demand for their products.

While uncertainties over Fiat's long-term future could restrain future investments in new laser welding technologies, the company might alternatively adopt more aggressive modernisation and automation efforts, thereby boosting the uptake of laser welding equipment in Italy.

"However, over the long run, there is only so much that a company like Fiat can contribute to laser welding demand on its own, especially as lasers generate little replacement demand", cautions Frost and Sullivan Research Analyst Titus Hocevar.

"In this context, the strategic re-orientation of Italian automotive suppliers towards greater co-operation with German car manufacturers is a positive trend since the Italian automotive sector based around a single company cannot generate as much demand as several different large German car manufacturers".

At the same time, with laser welding resulting in higher quality of components, some Italian suppliers are also adopting the technology in order to win and retain supply contracts from their German automotive clients.

This trend is likely to persist since there is still a lot of room for the adoption of laser welding technology into production.

The current focus on the automotive sector has meant that many applications in other end-user sectors have remained relatively undeveloped.

The heavy industrial manufacturing (particularly railway wagon manufacturing and, in the long-term, shipbuilding), aerospace, light industrial manufacturing (especially welded tube manufacturing and production of radiators) as well as electronics and medical sectors offer promising applications for laser welding that are yet to be fully developed.

Supported by the country's substantial industrial base and the amount of metal processing performed, the Italian welding equipment market currently ranks second in terms of absolute size within Europe.

Intensifying pressures on the Italian metal processing and several manufacturing sectors to add more value to combat low-cost competition will motivate greater process automation, in turn boosting the uptake of complementary laser welding equipment.

With Italian industry working more closely with universities and research institutes to promote advances in the technology-intensive laser welding arena and widen the field of applications, the Italian laser welding equipment market looks set to reduce the advantage its German counterpart has in terms of applied research.

"Building the knowhow relevant to the laser welding equipment market through co-operation between commercial entities and research institutes is the best long-term solution to developing the market", advises Hocevar.

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