Global vision market faces headwinds
In August, two machine vision bellwethers, Cognex and Basler, reported their quarterly earnings. Basler, a German manufacturer of cameras and accessories, reported that incoming orders decreased to €94 million ($102 million) in the
first six months of 2023 — a decrease of 41% from the same period last year.
Management cited weakened demand from consumer electronics, logistics, and laboratory automation equipment in Asia and North America.
“During the shutdown, the boom in consumer electronics and online ordering,
as well as the need for vision inspection, led to very large capacity expansions in these industries, resulting in very high demand for capital equipment and vision
components,” the management team said.
Since mid-2022, the company has experienced a “drastic correction to this
extraordinary trend,” according to the report. Basler noted that many of its
customers have seen a sharp increase in inventories due to over-ordering during
the chip crisis, lessening the need for capital goods. Too much inventory equates
to a marked decrease in the need for machine vision systems.
For Natick, Mass.-based Cognex Corp., there were similarly somber results.
Revenue declined 12% for the quarter, which the company attributed to ongoing softness in e-commerce logistics as well as weaker demand from factory
automation customers in the electronics and semiconductor capital equipment
markets.
The results align with findings from Vision Markets’ managing partner Ronald
Müller, who forecasts the vision markets using two indicators: the change in
manufacturing output, which is a lagging indicator, and a forward-looking indicator that tracks the sentiment index of purchasing managers.
According to the Vision Markets’ report, the manufacturing output of the U.S. “grew by 2.9% year-over-year in 2022. The beginning of 2023 showed further
year-over-year growth, while the beginning of 2022 was still under the pressure of the pandemic.” The leading indicator average for the first seven months of 2023 “also suggests a decline in production activities.”
However, for the U.S. vision market, the report also states that indicators that look further ahead than purchasing managers’ expectations “give hope for a recovery in the next 12 months and beyond.” This is spurred by investments in the manufacture of semiconductors and electronics as part of the U.S. CHIPS Act.
The European Union, especially Germany, is facing a “severe and worsening
recession in manufacturing.” While the manufacturing output grew year-over-year in three out of seven months, “the trend is clearly downward,” according to the report.
For additional details, the market update can be found here: www.markets.vision/darkness-and-glimmers-machine-vision-market-update-2023-08/.
Published: September 2023