Asia-Pacific leads pressure switch market growth

Global shipments of pressure switches are forecast to increase at a compound annual growth rate of 3% from US $965.6 million in 2006 to $1121.8 million in 2011.

Global shipments of pressure switches are forecast to increase at a compound annual growth rate (CAGR) of 3% from US $965.6 million in 2006 to $1121.8 million in 2011, according to a recent market study by Venture Development Corporation (VDC).

The global market is segmented in the study by major geographic regions: the Americas (Central, North and South America), Asia-Pacific and EMEA (Europe, the Middle East and Africa).

Among the three, the largest pressure switch market is in the Americas, followed by EMEA, with the smallest market being in the Asia-Pacific region.

However, the highest market growth rate is forecast for this region.

Pressure switch markets in China and some other countries of the Asia-Pacific region are starting to become significant and are attracting vendors from all around the globe.

Manufacturers are relocating production facilities in these countries, along with expanding production operations by existing and new local firms.

The competitive landscape is very different in the Asia-Pacific market than in the Americas and EMEA.

Pressure switch markets are more mature in countries such as the United States, Japan, and in Western Europe.

As such, the markets in these countries tend to be led by domestic firms, or at least firms headquartered in the region.

From the prospective of a new supplier breaking into these markets, a key barrier to entry is long-standing customer relations of the established suppliers with their customers.

Thus, the Asia-Pacific market has several characteristics that are attracting many companies.

However, they are also finding strong competition there.

Foreign vendors pursuing Asia-Pacific markets are finding that in addition to one another, they face competition from many Asia-Pacific start-ups.

These new entrants are focused mainly on low-technology imitation parts, and do not yet have the capability for manufacturing high-technology pressure switches.

Nonetheless their impact is starting to be felt in some applications.

These are mostly high-volume, low-price applications that also have low technology entry barriers.

To counter this, several global suppliers have moved their manufacturing operations to low-cost regions such as Asia, Eastern Europe, and South America.

Additional vendors are likely to follow.

In addition, vendors that position themselves in high-technology sectors will have an advantage in capitalising on need in the region for sophisticated products.

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