Few would argue that the acquisition of FLIR by Teledyne on January 4th came as something of a shock. Each company has a rich history of aggressive growth by acquisition, with FLIR having added US-based Altavian, a manufacturer of small unmanned aerial systems, to its portfolio of buys, as recently as December 2020.
But while Teledyne has sensor technologies spanning most of the electromagnetic spectrum, FLIR plugs an all-important gap; the infrared thermal detector, including two very famous and successful products, the Lepton and Boson cores, that made thermal imaging more available to commercial applications. Lepton and Boson components have been teared-down by System Plus Consulting (1). And Boson camera performance has been also tested by Piseo (2). Both companies, System Plus Consulting and Piseo belong to the Yole Group of Companies. With its new-found fleet of infrared imaging products in tow at a time when demand for thermal cameras is rising – According to its Thermal Imagers & Detectors report, Yole Développement (Yole) predicts growth from $4.5 billion in 2019 to $7.5 billion in 2025 – the American industrial conglomerate becomes a formidable player in the thermal camera market. This article is also using data & trends coming from the Machine Vision for Industry & Automation report from Yole.
So why is thermal imaging so hot right now? Thermal imagers are widely used in myriad applications from automotives to firefighting with rising demand coming from driving monitoring systems, nightime vision devices and ruggedized smartphones. However, thanks to the Covid-19 pandemic, the demand for thermal cameras in thermography applications, which can detect people with a fever and ultimately virus victims, mushroomed from a $1.2 billion market in 2019 to $3.16 billion by the end of 2020.
This growth spells good news for Teledyne as FLIR has held the lion-share of this market capturing some 54% of thermal imager shipments in 2019. However, by riding the fever detection wave and also meeting a demand for surveillance systems with ever-cheaper thermal imaging devices, Chinese players have also made huge progress this year.
In 2020, FLIR retained pole position but its market share decreased to 35% as GuideIR and Hikvision, both from China, displaced France-based Lynred and SEEK Thermal, US, from their top spots. So how will thermal imaging industry players from China and elsewhere respond to the Teledyne-FLIR acquisition?
More acquisitions may follow as thermal imaging companies reposition themselves across this growing market. At the same time, the likes of GuideIR and Hikvision could continue to capture market share from leading players including Teledyne with FLIR as well as Lynred and SEEK.
Still, for Teledyne and other domestic US businesses, the 2019 US National Defence Authorization Act, which bans purchases of security cameras manufactured in certain factories in China, will only help, and could open up new opportunities for home-grown industry. But it’s not just about thermal imaging.
As well as leading the thermal imaging market, FLIR was also an industry heavyweight in machine vision cameras, holding 10% of a $2.1 billion market in 2019, characterized by a multiplicity of players. Having acquired FLIR, Teledyne now has a mighty 16% of the machine vision camera market, making it the second biggest industry player alongside Cognex, US, with only Keyence of Japan ahead with its 19% share.
The latest acquisition gives Teledyne a greater presence in the industrial camera market (including Machine Vision) that Yole predicts will grow from $3.5 billion in 2019 to $5 billion by 2025. Again, industry can only wait to see how key players such as Keyence and Cognex react and if more acquisitions, consolidation of power, and even rapid technology development will follow.
But what remains is that with FLIR, Teledyne is the leading company in thermal imaging as well as the second biggest player in the machine vision camera market. Now that’s a huge force to be reckoned with.
Dimitrios Damianos, PhD
Custom Project Business Developer and Technology & Market Analyst, Yole Développement (Yole)
Eric Mounier PhD.
Director of Market Research, Yole Développement (Yole)
(1) : FLIR One 2nd Generation & FLIR LEPTON 3 LWIR Core report, System Plus Consulting, 2016 – FLIR Boson – a small, innovative, low power, smart thermal camera core report, System Plus Consulting, 2017
(2): FLIR Boson Camera Performance Analysis report, Piseo – Release expected in Q1, 2021
Thermal Imagers and Detectors 2020
Thermography is benefiting from COVID-19 mitigation attempts, pushing the thermal camera industry to $6.6B in 2020.
Machine Vision for Industry and Automation 2018
Machine vision is at the heart of the automation revolution.