- THE MAGAZINE
- NEW PRODUCTS
In the next five years, carbon fiber and graphene manufacturing industry revenue is anticipated to rise as downstream manufacturing industries expand production and the federal government increases funding for carbon fiber and graphene research, according to a new report from IBISWorld. Similar to other manufacturing industries, demand for the carbon fiber and graphene manufacturing industry has been volatile during the five years to 2013.
“When the recession hit in late 2008 and carried on through 2009, demand declined for downstream customers as consumers reduced purchases in light of falling disposable income,” said Radia Amari, IBISWorld industry analyst. “This decline hindered revenue growth for carbon fiber manufacturers. However, as the economy began to recover and consumer disposable income increased, demand from end users like aircraft and automobile manufacturers began to grow, in turn boosting demand for carbon fiber.”
Over the five years to 2013, revenue is expected to grow at an annualized rate of 2.5% to $2.1 billion. With the economy continuing to grow, revenue is anticipated to increase 8.2% in 2013 alone.
In addition to shifts in demand, the carbon fiber and graphene manufacturing industry endured high raw material costs, which will remain constant in 2013. In light of this factor, industry firms raised selling prices to offset feedstock costs. “Together with rising demand for exports, these higher selling prices are expected to increase industry profit in 2013,” Amari said.
Concentration in the industry is high, reportedly due to its capital intensive nature, the high level of technical expertise required to manufacture carbon fiber and the large-scale nature of the majority of end users of carbon fiber. Indeed, the industry’s primary domestic market—commercial aviation and aerospace—is also very concentrated; large aerospace manufacturers prefer to deal with large carbon fiber manufacturers that have the capacity to meet their demand.
In the next five years, industry revenue is forecast to increase. Downstream manufacturing industries will increasingly demand carbon fiber as production expands and the trend toward creating stronger, yet lighter and more fuel-efficient products grows. Demand from the federal government for industry products will also rise over the next five years as its budget grows. The federal government uses carbon fiber in the production of military aircraft and equipment; it also invests significantly in carbon fiber and graphene research.
For additional information, visit www.ibisworld.com.