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Nanotech feels downturn sting

Posted: 26 Jun 2009 ?? ?Print Version ?Bookmark and Share

Keywords:recession? nanotechnology? nanomaterial?

The economic recession is draining demand in several nano-enabled product market segments, and is eroding growth along the entire value chain, from nanointermediates to nanomaterials.

According to Lux Research's latest report, total revenues from products incorporating nanotechnology should still reach $2.5 trillion in 2015, but that signals a 21 percent drop from earlier projections.

The report blames reduced production volumes and a slower rate of new technology adoption.

The report, entitled The Recession's Ripple Effect on Nanotech, examined the recession's impact along the entire nanotech value chain and comprises intelligence gathered from over 1,000 interviews that Lux Research conducts every year, as well as more targeted interviews with executives from 15 different startups and corporations.

The report found that among nanomaterials, carbon nanotubes and ceramic nanoparticles will suffer the most due to their broad exposure to automotive and construction. Nanocomposites and coatings will see the biggest declines among nanointermediates.

According to the Lux study, while the United States and Europe will still account for more than two-thirds of emerging nanotech revenue through 2015, their shares are expected to drop 2 to 3 percent each, relative to the previous forecast. Asia/Pacific's revenues should rise by 5 percent due to its relatively more competitive automotive industry.

In addition, the down economy invites well-resourced incumbents to renew and reposition their technology portfolios by snapping up struggling small companies on the cheap. Cash-strapped start-ups, meanwhile, will need to make cash conservation a priority until markets revive.

"Government nanotech initiatives will also need to change tack in order to sustain anticipated payback in jobs and GDP growth," said lead report author Jurron Bradley, a senior analyst at Lux Research, in a statement. "Rather than tax credits, they'll need to offer more creative incentives like R&D grants to help struggling start-ups survive the recession."

- Nicolas Mokhoff
EE Times

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