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Posted by Denise on August 20, 2024 at 6:19am 0 Comments 0 Likes
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COVID-19 Impact on Cryocooler in Semiconductors and Electronics Industry
ANALYSIS ON IMPACT OF COVID-19 ON THE MARKET
Coronavirus or more popularly known as COVID-19 which originated from Wuhan province in China has wreaked havoc and destruction and brought this world to a standstill. Major companies around the world have been forced to close down their offices to cut their expenses and smaller businesses have filed for bankruptcy. People have also been fired or are working with reduced salary. Central banks of various economies are introducing drastic measures to keep the country afloat however it is putting a massive strain on them. The major pharmaceuticals companies are on a race to develop the vaccine and are conducting rapid trails to get fastrack approvals for commercial usage. Among all this, many manufacturing facilities remained closed as a necessary step to prevent the spread of virus.
However, manufacturing facilities of essential goods such as pharmaceutical, food & beverages, power generation, and petrochemicals remained opened during this pandemic to supply essential goods to meet the demand of the market. Cryocooler is a device which is used for cooling environment of anything down to cryogenic temperatures. Cryocoolers are designed to achieve temperatures of approximately -150 degree Celsius and to -450 degree Celsius. It is used for various applications such as in military, commercial, medical, space, environmental and others. The demand for cryocoolers in defense industry was declined as many projects and contracts have been kept on hold in defense sector.
Additionally, the government of many countries has reduced their spending on defense sector. Also, the projects related to cellular base stations, semiconductor industry and process monitoring has been kept on hold or canceled. However, the demand for medicine and medical machine manufacturing and supplying has increased tremendously which require cryocooler in machines to cool the magnets in the MRI machines and liquefaction of oxygen for storage at hospitals. Also, for storing biological cells and specimens, cryocooler is required due to which the demand has steady growth. So, cryocooler market has witnessed mixed impact during pandemic situation and after removal of lockdown restrictions, the business will see normal growth in coming year.
AFTERMATH OF COVID-19 AND GOVERNMENT INITIATIVE TO BOOST THE MARKET
COVID-19 overall has a mixed impact on cryocooler market. Most importantly for storing the oxygen for treating the COVID-19 patients in emergency need machines with cryogenic temperatures which required cryocooler. The government and medical authorities across globe must be ready for the logistics of delivery of the approved COVID-19 vaccines. The companies are hoping cancelled or halted projects of defense to resume post COVID-19. Also, the space projects are halted, which might resume in some time will require cryocooler for missile guidance which can boost the market. Cryocooler manufacturers are collaborating and acquiring other players for coping up with the post COVID-19 situation.
For instance,
• The latest partnership between Quantum Design (QD) and Sumitomo (SHI) Cryogenics of America, Inc. (SCAI), a subsidiary of Sumitomo Heavy Industries Ltd., has been announced to introduce groundbreaking new products and related technologies to the market.
STRATEGIC DECISIONS FOR MANUFACTURERS AFTER COVID-19 TO GAIN COMPETITIVE MARKET SHARE
The demand for cryocooler is expected to be low in 2021 also as there is huge disruption in military and transportation industries. The supply chain has also been severely affected due to which the demand has declined. Many major companies operating in cryocooler market have experienced reduction in the demand of cryocooler.
However, cooling of stored nitrogen, oxygen and argon gases in hospitals needed cryogenic temperatures which have shown little steady growth of market. The companies are expecting get some recovery in next year. The companies have collaborating with other industry players for innovating and bring new products. Also, companies are entering into contracts with other industry players to increase their sales and generate revenue.
For instance,
• Thales Cryogenics, the European leader in cryogenic technology and supplier of cryogenic coolers, signed an agreement with Airbus Defense and Space in December 2020 to supply two cryogenic coolers dedicated to the satellite TRISHNA (Thermal infrared imaging satellite for high-resolution natural resource assessment).
The companies are taking strategic decisions such as reducing staff or investing in R&D to increase their production to cater to the optimal demand of cryocoolers in coming years across various geographies.
IMPACT ON DEMAND
The pandemic has reduced the demand of cryocooler due to the cancellations or halts of military, space and transportation projects. However, many end-users such as healthcare and research & development have demand for cryocooler.
IMPACT ON SUPPLY CHAIN
The disruption of global supply chain has impacted the supply of the cryocooler as the manufacturing and transportation were restricted or halted. However, the production is restarting slowly and is aimed at easing the supply choke. Many companies are expecting to see growth in the next quarter results for cryocooler market as healthcare pharma will continue to offer excellent opportunities for cryocooler business in new normal.
CONCLUSION
COVID-19 has had a mixed impact as the demand for cryocooler is balanced by the demand in pharmaceutical and healthcare industry has increased. Initially, the demand was muted but it is picking up rapidly due to which the manufacturing plants are restarting to cater to this growing demand.
Governments of emerging nations are introducing strategies in order to attract major manufacturing companies and establish themselves as a global electronics manufacturing supplier. Major companies are also acquiring or are being acquired by other companies and also partnering with other companies in order to accelerate innovation. R&D is being carried out where technology is improving rapidly and the use of cryocooler are widening while being efficient at the same time.
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