Manufacturing Execution Systems Market Size, Share & Trends Analysis Report By Deployment (On-premise, Cloud, Hybrid), By Offering (Software, Services, Professional Service, Managed Services), By Application (Production Management, Quality Management, Inventory Management, Maintenance Management, Performance Analysis), By Product Function (Document Control, Inventory Management, Production Performance Analysis, Others), By End-use (Food & Beverage, Oil & Gas, Pharmaceutical & Lifesciences, Automotive, Electronics & Semiconductor, Other), By Industry Type (Discrete Industry, Process Industry) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2024-2032

Market Overview

The global manufacturing execution systems market size was valued at USD 16.24 billion in 2023 and reached USD 18.19 billion in 2024. It is projected to reach USD 45.03 billion by 2032, growing with a CAGR of 12% during the forecast period (2023–2032).

A Manufacturing Execution System (MES) enhances the efficiency and precision of the manufacturing process. Up until a few years back, the idea of a smart factory was abstract because of several limitations, such as prohibitive computing storage, bandwidth costs, and limitations in digital technology capabilities. Today, these obstacles have diminished dramatically due to inclusive technological advancements that make it possible to do more with low investments across a broader network. Furthermore, the development of sophisticated technologies, with the emergence of artificial intelligence (AI), cognitive computing, and machine learning, are allowing manufacturers to move beyond task automation toward more complex and well-connected processes.

At present, there is a marked need for process automation as manufacturers are not only emphasizing increasing productivity but also improving the operational quality of production processes. Manufacturers around the globe are adopting manufacturing execution systems equipped with technologies such as Big Data, Augmented Reality (AR), and Industrial Internet of Things (IIoT) platforms, among others.

Market Dynamics

What are the factors driving the market growth?

Operational Concerns Associated with Inventory Management

Inventory management is an integral part of any organization. Poor inventory management is the most common issue faced by both large manufacturers and SMEs, which affects the overall performance of the organization. Underproduction, overproduction, and stock-out are some of the common challenges faced by organizations unable to tackle inventory management. Manufacturing Execution Systems offer a promising solution for poor inventory management as they efficiently monitor pre- and post-manufacturing processes.

Technological Advancements

To address the rapidly expanding demand from end users and to increase their market position, the developers of MES software are introducing technologically innovative products. For Example, iTAC Software AG, a Germany-based provider of internet-based information technology and communication systems for the manufacturing industry, launched iTAC.MES.Suite 9.20.00 , which enables advanced planning and scheduling of orders, as well as control & automation of the production process. Honeywell purchased Performix Inc. for an unknown amount in September 2021. Honeywell's goal with this acquisition is to build the world's leading integrated software platform for customers in the life sciences industry, with the inherent potential to achieve faster compliance, improved dependability, and higher production throughput while maintaining the highest quality. Technological advancements and new product development activities carried out by the top players will drive the MES market during the forecast period.

What are the factors restraining the market growth?

Technical Issues

The manufacturing sector is extensive and diverse. Large corporations may be able to afford technical expertise in-house, whereas smaller businesses typically have restricted skill sets. When technical challenges in networking, coding, and other MES system implementation needs develop, third-party knowledge can become prohibitively expensive for small businesses. Even after the industrial execution system has been effectively implemented, technical concerns may persist or arise. Human mistakes, such as the failure to disconnect an asset, the movement of machinery, the replacement of parts, and other circumstances, can result in technical faults that must be located and resolved. Over the years, many businesses with a significant in-house IT infrastructure have gradually developed this infrastructure. Technical difficulties might be worsened by communication protocols, differing OEM components, and other infrastructural obstacles.

Regional Analysis

North America is anticipated to continue to dominate the MES market throughout the forecast period, largely due to the presence of a few key MES vendors. In addition, North America's robust financial situation enables it to invest aggressively in cutting-edge systems and innovations that have given it an advantage. In addition, industry participants are establishing a number of organizations in the region, which assists them in consolidating their offerings and expanding their market presence. Growth in the number of small and medium-sized enterprises (SMEs) and the increasing digitalization of assembly capabilities by large corporations such as IBM and General Electric are driving the growth of the IoT industry in the local manufacturing sector. Small and medium-sized enterprises (SMEs) are incorporating new innovations into their existing frameworks, whereas large manufacturers have substantial plans for digitization expenditures. This facilitates the reception of MES in the region.

Demand for MESs in Europe is increasing because of the need for efficiency improvements through real-time data accessibility. Over the years, several regional companies have been observed to have ramped up investments in enhancing and effectively controlling their operations with Programmable Logic Controllers and Supervisory Control & Data Acquisition Systems. These platforms offer real-time display and visualization of operational processes in the plant, thereby enabling operator interaction. However, to improve operational efficiency, companies must effectively synchronize the production process with other business processes, where MESs play a vital role. Thus, the growing need for operational efficiency pegs Europe as a potential market space for MES.

In the Asia-Pacific region, dynamic industrial growth presents tremendous opportunities for the MESs market. Countries in the Asia Pacific exhibit significant growth potential in industrial sectors such as manufacturing, mining, oil and gas, and others. According to a study by Honeywell, one of the leading players in MES, the Pacific region is observed to grow in the mining sector, whereas India’s industrial growth is led by the power and energy sector. China is a significant contributor to the capital expenditure for industrial development but registers moderate growth. It can be concluded that the region’s evolving industrial sector will offer several growth prospects for the MES market. Improving economic conditions in the Asia-Pacific region will likely continue to create favorable conditions for the Manufacturing Execution Systems market, as MESs are in high demand from various industries.

The primary element fueling the growth of the Middle East and Africa manufacturing execution systems market is the integration of artificial intelligence into MES systems. However, the high cost of implementation and maintenance hinders the expansion of the manufacturing execution systems market in the region. The increasing reliance of the industrial sector on technology and modern machinery is driving the expansion of the manufacturing sector. Introducing sensors, wireless technology, and intelligent control systems have revolutionized the production process flow. These transformations have changed the relationships between humans, machines, data, and technical systems. The market in Latin America, the Middle East, and Africa region will continue to expand as a result of increasing industrialization and rising demand for advanced automation tools in the manufacturing sector.

Segmental Analysis

Based on deployment type manufacturing execution systems market is segmented into on-premises, on-demand.

The on-premises segment holds the largest market share. Manufacturers adopt on-premise MES to retain all their existing processes and internal systems, such as authentication and access credentials. The hybrid segment holds the second-largest share of the global manufacturing execution systems market. The hybrid is implemented in the oil and gas sector due to the growing demand for real-time data monitoring of oil and gas fields. Additionally, a hybrid MES offers additional storage capacity, which ensures data security.

Based on offerings manufacturing execution systems market is segmented into Software and Services.

The Software segment encompasses various applications that facilitate real-time monitoring, control, and optimization of manufacturing processes, such as production scheduling, quality management, and data collection. Services, on the other hand, include consulting, implementation, support, and maintenance, ensuring the effective deployment and continuous operation of MES solutions. Both segments are crucial for enhancing operational efficiency, reducing downtime, and ensuring product quality across diverse manufacturing environments

Based on product function, the market is segmented into document control, inventory management, production performance analysis, and others.

Document control contains systems that store records that must be maintained, utilized, and kept by operations in the appropriate order. These documents include operational documentation, records required for quality compliance, and others.

Production Performance analysis contains systems that compile the data acquired by the plant and provide thorough reports, as well as methods for optimizing production through modifying manufacturing process factors.

Based on End use manufacturing execution systems market is segmented into Food & Beverage, Oil & Gas, Pharmaceutical & Lifesciences, Automotive, Electronics & Semiconductor, and Other.

In the Food & Beverage sector, MES enhances production efficiency and quality control by integrating with supply chain processes. The Oil & Gas industry benefits from MES by improving operational efficiency and regulatory compliance. In the Pharmaceutical & Lifesciences sector, MES ensures strict adherence to regulatory standards and enhances batch traceability. The Automotive industry leverages MES for real-time monitoring and production optimization. Electronics & Semiconductor manufacturers use MES for precision and process control. Lastly, the 'Other' category encompasses diverse applications such as aerospace, metals, and mining, each requiring tailored MES solutions for specific operational needs.

Based on industry type, the market is segmented into process industry and discrete industry.

The discrete industry dominates the MES market. The discrete industry is split into the automotive, aerospace & military, consumer packaged goods, medical devices, electronics & semiconductors, and other markets.

The process industry is anticipated to experience the highest growth rate over the projection period. The process industry is further subdivided into food & beverage, pulp & paper, chemical, energy & power, pharmaceutical & life sciences, and other markets.

Impact of covid-19

As part of steps to control the transmission of the COVID-19 pandemic, governments in several nations have limited the movement of commodities and people and suspended the functioning of manufacturing facilities. It has impacted power usage throughout the world. As per the short-term forecast of the United States Energy Information Administration (EIA), electricity consumption in the United States is expected to fall by a record 4.5% by the end of 2020, as businesses have temporarily shut down due to the government lockdowns to stop the prevalence of the coronavirus. As a result, global demand for and manufacturing instrument transformers is expected to fall.

Recent Developments

• October 2022- Scitara announced a new collaboration with Veeva, a leader in cloud software for the life sciences industry. Scitara's expertise in lab equipment solutions will be combined with the quality assurance (QA), and quality control (QC) software of Veeva will enable the firms to strengthen data integrity, maximize lab efficiency, and accelerate batch release.
• July 2022- SKF, a Swedish bearing and seal manufacturing company, and ABB, a leading global technology company signed a Memorandum of Understanding (MoU) to examine the possibility of a collaboration in the area of manufacturing process automation. The MOU was signed in Sweden at the ABB Robotics Experience Center. Through the relationship, SKF and ABB will explore and evaluate solutions to enhance clients' manufacturing capabilities and production efficiency.
• November 2021- Rockwell Automation unveiled a new remote access solution.The new system enables businesses to troubleshoot equipment from anywhere, decreasing customer downtime. The solution is made up of FactoryTalk Remote Access cloud-based software, which enables OEMs to manage, configure, and initiate secure connections to a customer's equipment, and the Stratix 4300 remote access router, which is installed at the customer's location to provide remote access to the equipment.