Material Processing Promotes The Development of Green Laser Pointer

Previously, “Two Drivers in the Laser Market in 2018: OLED Screens and VCSELs” pointed out two key factors in the development of the global laser market; a major application area that performed well in 2017 was material processing, especially nLignt, IPG Photonics. High-power green laser pointer for material processing from companies such as Lumentum, Wuhan Raycus and Coherent.

For example, the total revenue of the macro (1KW +) material processing laser in 2017 was $2.3 billion, an increase of 54% compared to 2016 revenue in this area. It should be noted that the average annual growth rate of high-power material processing is about 5-7%, so 2017 is of great significance to this field. The question now is, can this growth trend continue into 2018?

In 2017, most of the growth of KW+ lasers came from Asia (especially China) and Europe, and the growth in North America was relatively flat. The increase in KW+ laser revenues in Europe and Asia is largely attributable to three factors: 1) the use of laser tools has replaced non-laser forms, and the use of lasers has increased; 2) the number of large manufacturing projects that require the use of laser tools has increased. 3) Concerns about future price increases due to trade restrictions and tariffs.

The debate about which of the above three factors has the greatest impact has been ongoing, but there is no doubt that these three factors cannot be ignored. Laser tools are rapidly replacing non-laser tools, and a good economic development can drive many projects, and concerns about trade restrictions have also driven consumers’ early purchases.

As the threat of tariffs and trade restrictions may play a role in the growth of KW+ lasers in 2017, let’s look at the impact of this threat on the laser field in 2018. On June 15, President Trump approved a 25% tariff on US$50 billion worth of Chinese exports to the US, including laser machine tools, optical products, and lasers other than laser diodes. In response, China has published its own list of plans to impose a 15% or 25% tariff on the US exports to China. The list mainly includes products such as fruits, meat and steel pipes, but does not include lasers.

In view of the above factors, compared with 2017 revenue, the growth rate of high-power laser revenue in 2018 is expected to be much slower, but it will still be above average.