Cargo Container X-ray Inspection Systems Market Size, Share & COVID-19 Impact Analysis, By Type (Stationary Type and Mobile Type), By Application (Airports, Seaports, and Border Crossings/Roadways), and Regional Forecast, 2022-2029

The global cargo container X-ray inspection systems market size was valued at USD 1.56 billion in 2021 and is projected to grow from USD 1.69 billion in 2022 to USD 2.40 billion by 2029, exhibiting a CAGR of 5.8% during the forecast period. Based on our analysis, the global cargo container X-ray inspection systems market exhibited an average growth of -6.1% in 2020 as compared to 2019.

The research report includes specific trends and opportunities for market development with depth analysis of the market dynamics. The increasing threat of illegal smuggling of weapons of mass destruction, armaments, and the illegal drug trade has encouraged several governments to introduce more stringent and strict security measures. This is to reduce any possible threat and violation of cross-border safety trade. Taking serious cognizance of frequent terrorist attacks and international smuggling using seaports inspections using X-ray (computed tomographic) scanners has witnessed a significant increment in the recent past. The development of modern and innovative products with reduced adverse effects due to radiations in the environment and products a with faster rate of scanning to the scan maximum number of shipments in the limited timespan stands as a critical pointer reinforcing the growth of the market.

COVID-19 IMPACT

Substantial Uncertainty of Cargo and Shipping had a Serious Negative Impact on the Market Growth

Since the outbreak of COVID-19 in China, the global, as well as the U.S. economy, is passing in a disorder situation. The COVID-19 pandemic has damaged the U.S. economy. The spread of COVID-19 has resulted in a substantial decline in demand for air travel, which has adversely impacted the demand for products and services related to our airport security detection and automation business.

Cargo container shipping is the industry which serves as an integral part of global supply chain for most end users. During the COVID-19 pandemic, the shipping industry to transport food, medicine, and other necessities across border, and airports.

Also, prolong lockdown implemented globally, and U.S., which results in decline the GDP of the U.S. economy, according to International Monetary Fund (IMF), the GDP of U.S. decline by 8% in fiscal year 2020.  A shortage of empty containers observed since 2020, owing to COVID-19 pandemic. The pandemic had such as enormous impact in 2020 that changes in classification are out of ordinary, owing to entirely unusual situation.

Trading activities in U.S. dropped by around 12.6% in the year 2020 as compared to 2019. Generally, U.S. being considered as a major exporter of cargo shipping. However, with the emergence of the pandemic, there has being a halt in trade activity, owing to high freight rates, and lack of empty shipping containers.

LATEST TRENDS

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Various organizations from all industry vertical are shifting their business toward digital platform and due to that the use of industrial automation is also increasing in the each and every sector. Maritime cargo and ports industry is also affected by implementation of industrial automation and digital technology in positive manner. Automation in security reduces time required for scanning and checking using cargo container x-ray inspection systems. It ultimately reduces the operational cost of process.

The emergence of advanced technology is introducing novel and improved methods of operating terminals and ports. The gradual shifting of business towards the implementation of automation in all of the operations conducted on ship terminals and ports has been leading to significant changes in maritime treading.

Cargo X-ray scanning system automation is using various advanced technology such as artificial intelligence, cloud computing and robotics in the operation of X-ray machines. This automated X-ray machine can scan 10 times more containers per hour than the traditional method. Also, the analysis that is obtained by scanning of containers is done by using artificial intelligence, which reduces human error and improves accuracy. The use of cloud computing in the automated X-ray machine directly save results on global server of service provider company.

DRIVING FACTORS

Increasing Demand for Cargo Container X-ray Inspection Systems Due to Stringent Security Protocols to Fuel Market Growth

In last few decades, the incidents of human trafficking had receded on major ports in the world. Also, the smuggling cases of drug and illegal arms & ammunition had registered on various ports throughout the globe. These unlawful activities are majorly done via marine transport with the help of cargo containers and cargo ships. Also it is found that various terrorist attack had conducted by using this illegally transported weapons which is creating major threats for ports and national security.

Drug trafficking is considered as an illegal activity globally. It includes manufacturing, distribution, cultivation and sale of narcotics substances which subjected to narcotics control act or anti-narcotics law. Recent studies conducted by the United Nations Office of Drugs and Crime had focused on various threats posed by smuggling of both cocaine and new psychoactive substance (NPS) is increasing.

For instance, In July 2022, the Coast Guard and Customs & Border Protection department of United State had seized 20,000 pounds of drug bags having estimated value of USD 3.6 million on Seattle Port. This bags contains, cocaine, marijuana, heroin, and fentanyl which had transported in cargo containers.

RESTRAINING FACTORS

High Operational and Initial Costs to Obstruct Market Growth

The inspection system procurement and installation incur a heavy initial investment, which stands as a critical point curbing the development prospects of the market. The carrier freight operators are reluctant towards integrating the cargo container x-ray inspection systems facility at their stations due to investment limitations. Furthermore, the regular operation of the system demands substantial availability of the skilled workforce, and modifications required at the ports increase operational overhead costs, which is also curtailing the market development to a considerable extent.

Moreover, the inspection of each container at the ports will increase the time required for loading and unloading the containers in the carrier decreasing the efficiency of the operations. To reduce the time required for loading and unloading most of port operators, especially at the seaports are more inclined toward reducing the installation of cargo container x-ray inspection systems.

SEGMENTATION

By Type Analysis

Increasing Standards of Safety in Inspection Zones for Stationary Type to Ensure Growth

Based on type, the market is further classified into stationary type and mobile type.

Stationary type segment is projected to hold a lion’s market share by type in the global market. The ability of stationary type products to scan big size container and the considerable reduction of radiation leaks using fixed type is the main reason the behind consumers’ proclivity towards stationary type products. Stationary type products are also anticipated to have a swift pace of growth in the market owing to continuous efforts of the consumers towards betterment of inspection zone infrastructure to ensure a safer and secured inspection zone. The development of a cargo container x-ray inspection systems zone with concrete padding and thick shielding at the entrance and exit doors minimize the possible leakage of radiations.

The market witnessed a considerable downfall during the times of pandemic due to reduced trade activities and sealed international boundaries by the major economies to reduce the transmission of the pandemic. Major seaport operators were facing a serious cash crunch and were finding it difficult to mitigate the negative effects of the pandemic on the market. This scenario further discouraged the customers from procuring and installing security systems at the dockyards reducing the market demand.

By Application Analysis

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Increment in Security Concerns at the Dockyards is projected to Aid Seaports Segment

On the basis of application, the market is divided into airports, seaports, and border crossings/ roadways.

Seaports is expected to hold a critical portion of the global market and is also expected to have a hefty pace of market growth owing to the increasing investment of government authorities to secure and reduce the illegal smuggling of banned substances and arms as cross border trade. Major manufacturers are focused on installing products and multiple sites and increasing cargo container x-ray inspection systems market share for border crossing, and airport applications. It enhances the product portfolio of x-ray installation systems for airports, and roadways applications. For instance, in October 2021, Nuctech Company Limited, based in China, provides more than 100 set of security screening equipment which consists of cargo container x-ray inspection systems, baggage handling equipment, for Dubai Expo event which held in 2021.

In terms of pace of growth, seaports segment is anticipated to register a healthy growth rate over throughout the period of forecast. The government authorities are skeptical towards increasing control over the trade securities by having large-size X-ray DR (digital radiography) equipment to inspect the cargo containers projecting promising development prospects for the market.

REGIONAL INSIGHTS

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The market of North America was valued at USD 0.69 billion in 2021 and is projected to witness an impressive CAGR of 5.8% over the forecast period. Government regulations regarding the safety of property and increasing awareness about safety among airports, seaborne, and border crossing, which increases the demand for cargo container x-ray inspection systems for security, are the factor that drive the growth of the market.

In addition, increasing demand for inspection and security services across airports and seaborne, which is expected to boost the demand for x-ray inspection systems. Also, increase in trade volumes and increasing retail industry, which needs more security systems such as x-ray inspection systems, fuels the growth of the market in the U.S. For instance, according to the U.S Chamber of Commerce, exports of goods and services increased by around 18.5% in 2021, compared to 2020. Such boom in the trade volume led to the rise in demand for x-ray inspection systems.

The market in Asia Pacific is projected to reach USD 0.74 million by 2029 due to increase in the shipping of export goods from the ports of China and Japan is bolstering the growth of the regional market at a considerable pace. Moreover, India is also trying to strengthen its manufacturing clusters across end use industries such as electronics and automotive which is increasing the opportunities of India to emerge as a prominent exporter in the global market.

U.S. to Progress With a Promising Pace Due to Extensive Security Standards by Federal Government

To improve the security system across the U.S., strict government standards are in place to inspect each and every vehicle, truck, and freight crossing the border. Such factors enhance the demand for x-ray inspection at border crossings and airports.

For instance, according to the Department of Homeland Security (DHS), over border crossing, every truck and freight must be scanned and inspected with x-ray inspection systems at ports of entry. Around 1% of the personal vehicles and 15% of the cargo trucks are scanned through this initiative.

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Such factors are anticipated to provide lucrative opportunities for global cargo container x-ray inspection systems market growth.

Europe is identified as the prime contributor to the market after North America and Asia Pacific region. The strong and interconnected supply chain of the major manufacturers in the region and beefed up security concerns due to frequent events of illegal drug trafficking through the medium of sea transport increasing the application and developing market size. Many manufacturers are trying to capture a new customer base in the mass exporting and importing economies across the European Union making it one of the most lucrative and market with extensive competition.

KEY INDUSTRY PLAYERS

Key Players Inculcating Product Diversity to Develop an Effective Supply Chain 

The market is fairly fragmented and consists of a significant number of established players in the landscape of the global market. OSI Systems Inc., Smiths Detection Group, Leidos Inc, Nuctech, and others are considered among the prominent and company type tier 1 tier players in the market, covering around 50% of the inspection systems market share by manufacturers. These key players have a worldwide presence across the regions including the European Countries, Asia Pacific, North America, and Middle East & Africa. Whereas, emerging players in the market including ADANI Group, L3Harris Technologies Inc, and Astrophysics Inc. are maintaining their position and hold a considerable domestic market share by company and are trying to establish their strong distribution channel to solidify their position in the market. To increase sales footprints across the region, domestic manufacturers are trying to develop product in accordance with the customer requirements and adopting a customer centric approach to operate in the market

The competitive situation and trends for aforementioned established market leaders are development of diverse product portfolio, growth of global transportation infrastructure, growth in e-commerce, and international trading activities, and changing security regulations in the aviation, and border crossing sectors.

LIST OF KEY COMPANIES PROFILED:

• OSI Systems, Inc. (U.S.)


• Leidos (U.S.)


• Smiths Group plc (U.K.)


• LINEV GROUP(ADANI) (U.K.)


• NUCTECH COMPANY LIMITED (China)


• CGN Begood Technology Co., Ltd. (China)


• Astrophysics Inc. (U.S.)


• VMI Security (Brazil)

KEY INDUSTRY DEVELOPMENTS:

• September 2022: Smiths Detection India signed a memorandum of understanding to manufacture advanced X-ray screening technologies with Navratna Defence PSU Bharat Electronics Limited.


• May 2020: Leidos acquire security detection and automation businesses of L3Harris Technologies which will allow Leidos to enter in market with automation and detection screening products.


• May 2020: Smiths Detection launched iCMORE, a detection algorithm, which is to be implemented in HI-SCAN 10080 XCT scanner to detect dangerous lithium batteries and contrabands.


• April 2021: Smith Detection System which operates as a prominent provider of threat detection and security screening technologies has introduced an innovative and enhanced algorithm for HI-SCAN 10080 EDX-2is which is capable of providing automatic detection of lithium batteries.


• October 2021: Japan Customs which is an authoritative body to manage customs department for cross border trade has ventured into an agreement with Smith Detection to install high performance cargo inspection systems with two Hi Energy 9 MeV, interlaced, and dual view HCVS. The systems will be installed at considerably busy ports of Kobe Customs located at Mizushima and Tokyo Customs situated at Jyonanjima.

REPORT COVERAGE

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The research report provides a detailed analysis of the global market and focuses on key aspects such as leading companies, types, and leading applications of the product. Besides this, the report offers insights into the industry trends and highlights the key industry developments. In addition to the factors mentioned above, the report encompasses several factors contributing to the market growth in recent years.

Report Scope & Segmentation