Rising export demand will help expand operators' reach and stabilize revenue
Los Angeles, CA (PRWEB) December 28, 2012
The Telescope Manufacturing industry has performed irregularly over the five years to 2012, with revenue contracting at an average annual rate of 2.9%. Although the recession reduced the level of consumer spending for new telescopes, several other factors led to lower demand during this period. The largest consumption areas, California and Texas, contain the greatest demand for industry-related products; however, consumer spending on durable goods had the most significant drops in these regions. Despite revenue losses during the past five years, there has been considerable growth in research and development activities among key participants, says IBISWorld industry analyst Deonta Smith. As the economy recovers, the Telescope Manufacturing industry continues to face challenges in 2012, prompting an estimated 0.9% decline in revenue to $126.7 million.
Beginning in 2008, revenue volatility became a concern for industry players; many participants sought to consolidate operations to stabilize fluctuations in revenue and achieve greater economies of scale. Consolidation pushed down the number of manufacturing facilities at an average annual rate of 2.4% in the five years to 2012. Simultaneously, telescope manufacturers attempted to reduce their production costs in an effort to invest more in research and development activities. As such, the total number of employees in the industry is expected to decrease at an average annual rate of 7.3% to 747 workers over the five-year period. The Telescope Manufacturing industry has a low level of market share concentration. The top two players are Meade Instruments Corp. and Celestron International Corp. During the five years to 2012, market share concentration has increased as a result of increased consolidation activity within the industry. Companies have been seeking opportunities to consolidate their operations to achieve greater economies of scale and minimize risks caused by demand fluctuations and overall changes in the economy, says Smith. Consequently, IBISWorld estimates the number of industry operators has declined an average 2.6% annually to 21 companies in the five years to 2012. Consolidation is forecast to continue over the next five years, as company numbers and their locations shrink in the wake of ongoing mergers and acquisitions.
The next five years are set to be bright for the industry. Higher levels of export activities will benefit the industry as manufacturers market to new demographics abroad. This trend is expected to boost the overall market for industry-related products, help stabilize revenue volatility and push revenue upward. Additionally, market share concentration will likely increase in the next five years as small companies serving niche markets face competition from larger operators. Over the five years to 2017, the number of telescope manufacturing companies is forecast to drop. For more information, visit IBISWorld’s Telescope Manufacturing in the US industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld industry Report Key Topics
This industry manufactures optical telescopes, which use lenses and mirrors to magnify the visible light reflected by distant objects. It does not include manufacturers of nonoptical telescopes, such as radio and infrared.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.