Encoder Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Encoder Market is segmented by Type (Rotary and Linear), Technology (Optical, Magnetic, Photoelectric and Others), End-User (Automotive, Electronics, Textile and Industrial among others), and Geography.

Encoder Market Snapshot

Encoder Market Overview
Study Period: 2018 - 2026
Base Year: 2021
Fastest Growing Market: Asia Pacific
Largest Market: North America
CAGR: 7.4 %
Encoder Market Major Players

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Market Overview

The Encoder Market (henceforth, referred to as the market studied) was valued at USD 2,235.1 million in 2020, and it is expected to reach USD 3,531.25 million by 2026, registering a CAGR of 7.4% during the forecast period (2021-2026). The need for high-end automation and industry 4.0 are the major factors behind the groeth of the market.

  • The growing number of cars and the increase in the production of car parts are key factors that drive the encoder market growth.With the rapid development in automation of vehicles to improve the experience for customers,encoders are increasingly used in car manufacturing by automakers as they provide real time speed, acceleration and rotational position information to the Automated Guided Vehicle controller.
  • The growth in the global encoder market can be attributed to the emerging need for accuracy, precision and control in the industrial sector.The increasing penetration of sophisticated automation equipment in industries such as automotive, electronics, etc. is accelerating the sales of encoder at a rapid rate across developed as well as developing nations.
  • Moreover, the ability of encoders to provide real-time data is aiding the industry experts to bring accuracy in workflow, enhance operational speed and ease process control. Consequently, the high productivity solutions offered by encoders is propelling the growth of global Encoders market.
  • As the COVID-19 transforms from a China-centric challenge to a global pandemic, the impact on the world electronics supply chains and markets has shifted. Due to widening quarantine orders in major economies is significantly reducing pressure on the electronics components supply chain. Participants in the electronics components industry are now facing the challenge of balancing the supply/demand environment in a world plagued with uncertainty and fear.

Scope of the Report

Encoders are components that are added to a direct current motor in order to convert the mechanical motion into digital pulses that can be interpreted by the integrated control electronics. The main purpose of the various types of encoders  is to transform information from one format to another for standardisation, speed adjustment or safety control.

Rotary Encoder
Linear Encoder
Printing Machinery
Other End-users
North America
Rest of the World

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Key Market Trends

Rotary Encoders to Drive the Market Growth

  • The rapid increase in industrial automation in various industries like aerospace, automotive, packaging, healthcare, and electronics is driving the demand for rotary encoders as they measure the rotation, angular speed, or position of moving parts in a wide range of applications.
  • Increasing use of rotary encoders in automobiles sector is the main factor which is increasing the demand for rotary encoders globally.In automotive industries, these are used in throttle position, steering wheel position and gear position. Another factor which is driving the rotary market is the adoption of rotary encoders in aerospace industries as these are used for automation in the aerospace industries.
  • The new generation of magnetic rotary encoders is expected to fuel the market growth, as they can be used anywhere where measurement accuracy, small size, or durability in harsh ambient conditions is required like in Wind Industry, General Engineering, Mobile equipment etc.
  • The increasing demand for temperature control, velocity control, volume control, and position sensing across various applications such as on motors paired with drives and automated machinery in consumer electronics, elevators, conveyor speed monitors, industrial machines, and robotics is expected to boost the market growth
  • Industrial robotic applications are expected to be one of the major opportunities in the rotary encoders. Automation in a different sectors will create demand for robotics which in turn will create demand for rotary angle sensors. Moreover, electronic sector is also one of the important sectors where opportunities are expected during the forecast period.
Encoder Market key Trends

Asia-Pacific To Account for Highest Market Growth

  • Asia Pacific is projected to have the fastest growth, owing to rapidly expanding end-user industrial base in developing nations such as China and India in this region.
  • The growing concept of connected cars, electric vehicles, and China’s regulations regarding automotive safety are anticipated to drive the adoption of encoders, thereby driving the growth of the market during the forecast period.
  • Increasing manufacturing services across various industries in this region and growing implementation of automation techniques and robotics in manufacturing plants are among the factors that are expected to drive the demand for encoders in this region.
  • The rise of the intelligent city concept across important regional pockets further contributes to the progress of the linked infrastructure, the growth of the market for semiconductors and auxiliary components. As a result of this rapid growth in the global manufacturing sector, demand for encoders is growing in the region.
Encoder Market Growth Rate

Competitive Landscape

The Encoder Market is competitive and consists of several major players.The major players with prominent share in the market are focusing on expanding their customer base across foreign countries.These companies are leveraging on strategic collaborative initiatives to increase their market share and increase their profitability. Some of the key developments in the market are:

  • September 2019 - FAULHABER Drive Systems collaborated with EDEL Teknoloji Sistemleri San. Ve Tic. Ltd. Sti., located in Izmir as a new distribution partner in Turkey.The company will handle sales, technical consultation and service for all of Turkey.

Table of Contents


    1. 1.1 Study Deliverables

    2. 1.2 Study Assumptions

    3. 1.3 Scope of the Study




    1. 4.1 Market Overview

    2. 4.2 Market Drivers

      1. 4.2.1 High Adoption in Advanced Automotive Systems

      2. 4.2.2 Rising Demand of Industrial Automation

    3. 4.3 Market Restraints

    4. 4.4 Industry Value Chain Analysis​

    5. 4.5 Industry Attractiveness - Porter's Five Forces Analysis​

      1. 4.5.1 Threat of New Entrants

      2. 4.5.2 Bargaining Power of Buyers/Consumers

      3. 4.5.3 Bargaining Power of Suppliers

      4. 4.5.4 Threat of Substitute Products

      5. 4.5.5 Intensity of Competitive Rivalry

    6. 4.6 Assessment of Impact of Covid-19 on the Encoder Market


    1. 5.1 Type

      1. 5.1.1 Rotary Encoder

      2. 5.1.2 Linear Encoder

    2. 5.2 Technolgy

      1. 5.2.1 Optical

      2. 5.2.2 Magnetic

      3. 5.2.3 Photoelectric

      4. 5.2.4 Others

    3. 5.3 End-user

      1. 5.3.1 Automotive

      2. 5.3.2 Electronics

      3. 5.3.3 Textile

      4. 5.3.4 Printing Machinery

      5. 5.3.5 Industrial

      6. 5.3.6 Medical

      7. 5.3.7 Other End-users

    4. 5.4 Geography

      1. 5.4.1 North America

      2. 5.4.2 Europe

      3. 5.4.3 Asia-Pacific

      4. 5.4.4 Rest of the World


    1. 6.1 Company Profiles

      1. 6.1.1 Omron Corporation

      2. 6.1.2 Honeywell International

      3. 6.1.3 Schneider Electric

      4. 6.1.4 Rockwell Automation Inc.

      5. 6.1.5 Panasonic Corporation

      6. 6.1.6 Baumer Group

      7. 6.1.7 BEI Sensors

      8. 6.1.8 Dynapar Corporation

      9. 6.1.9 FAULHABER Drive Systems

      10. 6.1.10 Pepperl+Fuchs International

      11. 6.1.11 Hengstler GmbH

      12. 6.1.12 Maxon Motor Ag.

      13. 6.1.13 Heidenhain GmbH

      14. 6.1.14 POSITAL FRABA Inc

      15. 6.1.15 Sensata Technologies

    2. *List Not Exhaustive


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Frequently Asked Questions

The Encoder Market market is studied from 2018 - 2026.

The Encoder Market is growing at a CAGR of 7.4% over the next 5 years.

Asia Pacific is growing at the highest CAGR over 2021- 2026.

North America holds highest share in 2020.

Omron Corporation , Honeywell International, Schneider Electric, Rockwell Automation Inc., Panasonic Corporation are the major companies operating in Encoder Market.

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