Market and Technology Trends

Thermal Imaging and Sensing 2024

By Yole Intelligence — Apr 2024

China pivots on thermal imaging technologies, capturing 50% of global shipments in 2023, while Europe still dominates the thermal detector industry.

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More thermal detectors in wearables? | More thermal imagers in cars?

Thermal detectors: New opportunities to propel the market by 2029

The industrial end-market continues to dominate this sector, particularly with pyroelectric technology detectors. Chinese players experienced a significant decline in business post-COVID-19, while US and European companies stabilized their operations and seized new opportunities in the market.

Four main drivers are fueling the growth and revitalizing the diffusion of thermal detector technologies. The consumer market with thermopile penetration into wearables has begun. The automotive market also presents growth opportunities linked to the electrification of vehicles. In the industrial end-market, a significant uptick is anticipated due to considerations of energy savings Additionally, there is growing interest in the gas sensors market, expected to expand due to smart appliances and new HVAC regulations in the industrial end-market. The medical market, after experiencing a surge in demand, is currently saturated and is projected to decline at a rate of 1.7% annually from 2023 to 2029.

Thermal imaging: A stable growth in 2023, the automotive wave expected for 2028?

The market continued to grow in 2023, driven by traditional commercial applications. Similar to the pre-COVID era, price erosion at the microbolometer level is still significant, contributing to the market expansion in volumes. This trend is exacerbated by leading Chinese players who have closed the performance gap with historical players, have the highest production capacities, and deliver price-competitive products.

The Industrial market volume growth is balanced by lower prices due to the presence of more low-end systems in the product mix. Demand is rising for fixed-mount low-end cameras used for security purposes or predictive maintenance. The Personal Vision System (PVS) segment is driving consumer market growth with unprecedented success in the European market. The system’s increasing performance and decreasing prices encourage wider adoption. Geopolitical tensions and the recent emergence of high-intensity conflicts are providing a tailwind for the Defense & aerospace market. The Automotive market represents an opportunity created by the emergence of new stringent regulations in the US on Autonomous Emergency Braking systems, which could be enforced in 2028. The outcome of the vote on these regulations, planned for the first half of 2024, will be critical to triggering mass adoption.

Newcomers in thermal detection | Diverging strategies in thermal imaging

Thermal detectors: increasing interest from the market

Excelitas is still leading the market thanks to its vast and diversified portfolio, answering needs in the smart building market (presence detection, gas sensors…) for industrial applications. Melexis penetrated the consumer and automotive markets in 2023 with partnerships with big players in these fields. (i.e., Samsung, Google, Tesla) Melexis could be challenged in the coming years by competitors looking for such attractive markets. Meanwhile, new players such as Calumino, Jon De Tech, Meridian Innovation, and ST Microelectronics could grab part of the market thanks to their technology innovation strategies. These new solutions are between the thermal detectors and thermal imagers markets. These solutions could put an end to the competition between detectors and imagers thanks to cost-effective, accurate, and efficient solutions. In addition, the gas sensors market is expected to grow thanks to smart appliances and new regulations for HVAC in the industrial end market. Module makers should push NDIR technology and thermal detector manufacturers should benefit from this.

Thermal imagers: several paths for growth

Chinese leaders InfiRay and Hikmicro continue to expand, powered by volume-oriented strategies, and are becoming dominant in the Industrial and Consumer segments. In 2023, the Chinese ecosystem reached the 50% milestone of thermal imager shipments globally. Faced with this competition in industrial applications, Western players maintained their place in government-oriented applications (security, firefighting, defense, and aerospace…) and are expected to focus on high-margin products. The Automotive business opportunity opened up by regulations in the US (which could be followed by Europe) has put several key players in an intense technological push position, encouraged by start-ups focused on this segment, such as Adasky and Owl. Geopolitics affects the supply chain... Several defense-oriented players have engaged in financial activities, which can be seen as a sign that the industry expects higher production rates in the coming year. The ongoing US-China trade war continues to impact the thermal imaging industry. The recent restriction on Germanium exports announced by the Chinese government has caused lens prices to rise slightly and triggered immediate reactions from the U.S. ecosystem.

Several technology shifts in thermal detection | Smaller pixels in thermal imaging

Thermal detectors: new technologies could unlock new opportunities

Pyroelectrics were leading the market. We are observing a change in the balance from the thermopile market that will grow faster and lead the thermal detector market in value. Calumino, Jon De Tech, Meridian Innovation, and ST Microelectronics developed innovative solutions that could be boosted by AI for various applications and compete with entry-level microbolometer technology. This will unlock new opportunities that thermopile technologies never reached because of the competition with microbolometer technology. With more interest from the consumer end market, we are expecting sensor fusion of thermal detectors with PPG modules. For example, continuous temperature monitoring in wearables could bring meaningful healthcare insights to consumers/patients. To reduce cost and size, we also expect more development of free-lens thermal detectors, which should reach the market in the coming years.

Thermal imaging: the race for smaller pixels continues

There are currently two major axes of improvement in microbolometer chips. On the one hand, the industry is working to improve manufacturing processes to increase yield, reduce cost, and encourage wider adoption of thermal imaging technologies. On the other hand, there has been a trend toward smaller pixels for several years. Smaller pixels will contribute to smaller chip sizes and, thus, lower costs, which is the goal of the players targeting the automotive market. Smaller pixels are also needed to increase the resolution of thermal cameras designed for longer-range imaging in defense and consumer PVS applications. Will microbolometers be replaced by uncooled photodetectors in the long term? Several companies introduced commercial quantum dot thin films to make SWIR imagers a few years ago. This technology may be a candidate for MWIR and LWIR imaging in the long term.

ams-OSRAM, Axis Communications, BAE Systems, Baoding Jingze Optical & Electrical Technology Co. Ltd, Baoding Sanjing Electronics Material Co. Ltd., Beijing Acme Optoelectronic Technology Co. Ltd., Beijing Dongyuhongda Technology Co. Ltd., Beijing FJR Optoeletronic Technology Co. Ltd., Beijing Hongyuan Shengda Electro-Optic Technology Co. Ltd., Beijing Huayuanhao Photoelectric Technology Co. Ltd., Beijing WanTengDaSi Technology Co. Ltd., Bosch, Bullard, Calumino, Caterpillar, CETC Electro-Optics Technology Co. Ltd., Chengdu Huishi Opto-Electronic technology Co. Ltd., China Optical Infrared Technology (Dalian) Co. Ltd., CNBM Optoelectronic Materials Co. Ltd., Convergint, Cosinuss, Cypress, Dahua, Dali, Denso, Device-ALab, DeWalt, Dexter, Dias Infrared, DJI, Dongguan Xintai Instrument Co. Ltd., Dräger, Elbit Systems, Empatica, Excelitas, FaceSense, Fluke, Flyability, Flybotix, Foresight, FOTRIC, Fujian Forecam Optics Co. Ltd., Fujitsu, Global Sensor Technology (GSTiR), GreenWaves, Guangzhou SAT Infrared Technology Co. Ltd., Guide Sensmart, GWIC, GZLENS Optoelectronics China Co. Ltd., Hamamatsu, Hangzhou Zillion M&C Technology Co. Ltd., Hanhwa Techwin, Hebei IRhome Photoelectric Technology Co. Ltd., Heimann Sensors, Hensoldt, Hikvision, Hubei Jiuzhiang Infrared System Co. Ltd., i3system, Impossible, Infrared Cameras Inc, InfraTec, InVid, IR&D, IRay Technology Co. Ltd. (IRay / InfiRay), Irisys, Irlynx, Jenoptik, Jon De Tech, Kodenshi, Kunming Kaihang Optics Co. Ltd., Kyocera, L3 Harris, Leica, Leonardo DRS, LG Innotek, LightPath Technologies Lockheed Martin, Lucint, Luoyang AVIC Optronics Research Institute, Lynred, Melexis, Meridian Innovation, Micasense, Mikrosens, Mitsubishi Electric, MKS Ophir, Mobotix, MSA, Murata, NEC, Nextvision, Nicera, Northrop Grumman, NXP, Omron, onsemi, Opgal, OptoTherm, Orisystech, Panasonic, Parrot, Pyreos, Rafael ADS, Raytheon, Raytron, Safran, SATIR, SCD, Schneider Electric, Schott, Seek Thermal, Semitec, Senba Sensing Tec, Shanghai Sunshine Technologies Co., Ltd., Shenyang Sumboy Intelligent Imaging Technology Co. Ltd., Shenzhen Everbest Machinery Industry Co. Ltd., Shenzhen Jove Communication. Co. Ltd., Shenzhen Longot Technology Development Co. Ltd., Shenzhen Tekwin System Co. Ltd., Shenzhen Tsinghua Video Electronic Technology Co. Ltd., Sierra Olympic, STMicroelectronics, Sunell, Sunshine Technologies, Tamron, TE Connectivity, Teledyne Dalsa, Teledyne FLIR, Testo, Tetracam, Thales, Thermoteknix, Tianjin Jinhang Technical Physics Research Institute, Tianjin Zhongjing Semiconductor Materials Co. Ltd., Tower Semiconductor, Umicore, Uni-Trend Technology (China) Co. Ltd., Veoneer, Vital, Vital Optics Technology Co. Ltd., Wahl, Wavelength Opto-Electronic (Nanjing) Co. Ltd., Wintec, Workswell, Wuhan Huazhong Numerical Control Co, Xiamen SAN-U Optronics Co., Ltd, and more.

Report's objectives

This Yole Intelligence report is an updated version of the 2022 report, providing a complete analysis of thermal imaging and sensing markets, applications, and technologies.

This new version provides:

New significant trends and evolution in the thermal imaging and sensing industry markets, applications, and business models
Presentation of the hot spots where things are moving, along with future high-potential applications
Analysis of strategic moves since 2022: mergers and acquisitions, fundraising, etc.
Understanding of the competitive environment with an overview of key players, and the evolution of thermal imaging and sensing vendor market share per segment.
Updated market data and forecast up to 2029, in value and volume for thermal imagers (microbolometers) and detectors (pyroelectrics and thermopiles)
Supply chain description and analysis
Latest technology trends

This report thoroughly summarizes the 2023 thermal imaging and sensing market, considering the trends for each application. The report was finalized in early March 2024, so the data is the latest available.

Key Features

2024-2029 forecast for thermal imagers and detectors (Munits, $M)
2024-2029 forecast for silicon wafers for thermal chips
Market trends in the different end markets driving the adoption of thermal technologies.
Supply chain details for thermal imagers and detectors

What’s new?

New segmentations to better fit end-market trends
2024-2029 silicon wafer forecast thermal imagers and detectors

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