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Poor Economy Tempers Nanotech's Growth

Poor Economy Tempers Nanotech's Growth

Carbon nanotubes suffer as auto industry struggles.

Even promising technologies with vast untapped potential may falter in an economic downturn. That's exactly what is happening with nanotechnology, says emerging technologies advisory firm Lux Research in a new report. As their downstream markets struggle, some nano-enabled products are facing declining demand, tempering growth in the nanotech industry.

That's not to suggest nanotechnology won't continue its upward momentum, just that the momentum will slow. Lux Research predicts total revenues from products incorporating nanotechnology will reach $2.5 trillion in 2015, down 21% from earlier projections.

"The recession has hit automotive, construction -- and to a smaller degree, electronics -- the hardest," says senior analyst Jurron Bradley, lead author of the report "The Recession's Ripple Effect on Nanotech."

Key findings from the report include:

Not all nanotechnology is created equal. Due to their broad exposure to the automotive and construction industries, carbon nanotubes and ceramic nanoparticles will suffer more than other nanomaterials. Among nanointermediates, nanocomposites and coatings will decline the most.

Metal oxide nanotubes

Market shares will shift by geography. The United States and Europe will still account for more than two-thirds of emerging nanotech revenue through 2015, but their market shares will decline 2% to 3% more than previously anticipated. Meanwhile, the Asia/Pacific region's shares will grow as a result of a more stable auto industry.

A down economy favors the big firms. Well-established firms may have opportunities to reposition their technology portfolios by purchasing cash-strapped startups that can't wait out the downturn.

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