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Smart Manufacturing Market: Information by Component (Hardware, Software, Services), Technology (MES, PLC, ERP), End-Use (Automotive, Healthcare), and Region — Forecast till 2030

Published At : 07 Jun, 2022
Updated At : 12 Jul, 2022
Market Snapshot
Base Year:
2021
Study Period:
2020-2030
CAGR:
12 %
Fastest Growing Market:
North America
Largest Market:
Asia Pacific

The global smart manufacturing market size is expected to reach a valuation of USD 727 billion by 2030 growing at a CAGR of 12% during the forecast period (2022–2030). Smart manufacturing (SM) is a strategy driven by technology that uses Internet-connected equipment to monitor the manufacturing process. SM aims to seek a solution to enhance operational efficiency via data analytics and automate operations. The Industrial Internet of Things (IIoT) has a particular smart manufacturing application. Sensors are adopted in equipment production to gather information on their functional performance and state during implementations. Previously, data was retained on personal devices in local databases and was used to identify the cause of system breakdowns once it happened.

As smart manufacturing is becoming increasingly common and more equipment will be hooked up to the IoT, it will be able to interact more effectively, perhaps enabling further automation.

Smart Manufacturing Market Share

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Market Dynamics

Drivers: Government Support to Smart Manufacturing

Governments throughout the world recognize the bright future of smart manufacturing technologies. Thus, the government support and funds research and development for technologies like industrial 3D printing and IIoT. Various governments are sponsoring innovation in IIoT as they anticipate becoming prospective consumers of the technology. They are spending on new IoT implementation and research projects to operate and develop smart cities in the foreseeable future.

Governments across the globe are undertaking projects and sponsoring research and technology firms and educational institutions to analyze the possibilities of 3D printing technology further. Countries such as Canada, the United States, and the United Kingdom have established national initiatives to foster university-level 3D printing research, advance technology, and launch numerous enterprises. The emergence of novel uses for 3D printing has also piqued the interest of companies and governments worldwide. Asia-Pacific’s governments are constantly working on programs and strategies to digitize production sites.

For example, the government of India invested roughly USD 265 million in an "Economic Package" in May 2020. The investment was made to create businesses in various industries, including agriculture, manufacturing, healthcare, and others. Several MSMEs and startups are likely to implement automation software in their production units due to this investment, increasing their efficiency and business. Thus, government support through initiatives to adopt smart manufacturing is likely to drive the market over the forecast period.

Drivers: Advancements in Connectivity Technologies (5G) and Investments in New Infrastructure

The development of the 5G era is likely to alter the current IoT-based smart industrial applications. 5G can potentially change the way future IoT ecosystems are built, particularly in terms of latency, security, scalability, reliability, and the level of individual control over connectivity parameters. More complex use cases needing greater network capabilities are emerging as the scope of IoT application domains expands. Support for integrated sensors, more precise device positioning and high-speed device movement are examples of such capabilities.

5G can deliver speeds in the gigabits per second range, with latency in milliseconds and the capacity to handle 1,000 times more data than current network technologies. As a result, advancements in connection technologies like 5G are a significant element driving the global market growth. In addition, the introduction of 5G access radio networks is likely to have a substantial impact on the market. 

For example, according to Huawei Technologies, the fifth-generation wireless technology has the potential to increase global manufacturing GDP by USD 740 billion, or 4%, by 2030. Given the dynamics above, manufacturing, robotics, and other industries may be able to change the conventional trajectory by collaborating with the telecommunication sector to drive smart manufacturing technology acceptance.

Restraints: High Investments Involved

The demand for huge investments to install smart manufacturing solutions acts as a global curb on the market's growth. Innovative manufacturing technologies, including Enterprise Manufacturing Intelligence (EMI), Automated Guided Vehicles (AGVs), and Warehouse Management System (WMS), take a huge amount of capital to set up and deploy. This may put manufacturers off from implementing smart manufacturing. For example, EMI is deployed in businesses to enable real-time planning, control, and execution of processes to boost production and efficiency; however, this costs money.

The need for consulting, purchasing, and implementing these systems and services accounts for the high cost of installing data and enabling technology systems. The adoption of modern smart manufacturing equipment, like industrial robots and smart field devices, follows the introduction of smart manufacturing. Voice recognition, gesture recognition, and multitouch screens are examples of advanced functional technologies that can interface with these machines. This raises the system's cost even further. These technologies are still relatively costly, and enterprises operating in price-sensitive markets may face an additional financial strain.

What Are Future Growth Opportunities in Smart Manufacturing Market?

  • Rapid Industrialization in Developing Economies

Owing to lower real estate prices and labor costs, companies from industrialized economies are eager to expand their operations in emerging economies. Likewise, growing industrialization in rising economies such as Africa, Mexico, Brazil, India, China, and Indonesia have resulted in significant infrastructure costs, luring global firms to set up manufacturing operations in these regions. Due to these advancements, innovative and complex warehouse facilities are needed to connect and manage supply chains. 

Thus, the rapid industrialization in the emerging economies across the globe is likely to offer lucrative growth opportunities to the key players during the forecast period.

Which Trends May Impede Smart Manufacturing Market Growth?

  • The Proliferation of the Internet of Things and Big Data

Big data is the most important application, and it is regarded as one of the market's developing trends. Big data applications are in high demand due to the growing number of organized and unstructured data and information. Similarly, the Internet of Things is the most crucial commercial trend (IoT). Smart gadgets, automobiles, sensors, and other linked components are all part of the Internet of Things powered by artificial intelligence.

These devices generate enormous amounts of information, which artificial intelligence systems process. Self-driving/autonomous automobiles, smart houses, intelligent thermostats, pacemakers, smart city solutions, and other applications are among the possibilities.

Sensor technology advancements have resulted in a wide range of measurement equipment employed as components in automatic feedback control systems. Electromechanical probes are particularly vulnerable, as are laser beam scanning, electrical field approaches, and machine vision. The characteristics listed above are likely to be the key trends in the global market.

 

Impact of COVID-19 Analysis

COVID-19 had a significant impact on the global economy and all businesses worldwide. To stop the pandemic from spreading, governments around the world instituted lockdowns. The complete global lockdown severely disrupted people's livelihoods and quality of life in several countries' early stages of the pandemic. As a result, supply chain disruptions occurred all around the world. The world's economies have suffered due to a significant drop in product demand.

Covid -19 Impact On Market

The pandemic severely hampered production across industries, resulting in a lack of basic materials. The fall in production was primarily due to supply chain interruptions and a fall in exports. During this time, the primary goal of enterprises was to stay afloat, and intelligent manufacturing played an important role in helping businesses to operate efficiently with limited resources and manpower.

Market Recovery Timeline and its Challenges

The post-pandemic phase will be significant for the global smart manufacturing market. The recovery can be hindered by supply chain disruptions, which will affect the market dynamics and the prices of the product. Also, distribution and transportation capabilities restrictions, unfavorable financial conditions, and ascended expenses will challenge the global market. Also, limited production, support operations, labor shortages, and constraints for other end-user sectors, suppliers, and vendors may fail to meet the consumer demand. Overall, the recovery will be challenging for the global smart manufacturing market.

 

Segmental Analysis of Smart Manufacturing Market

The global smart manufacturing market share has been classified based on components, technology, end-use, and regions.

The smart manufacturing market has been segmented into hardware, software, and services based on components. The software component segment is expected to dominate the global market, and it is projected to reach USD 388 billion by 2030, registering a CAGR of 13% during the forecast period. Many solutions, such as product lifecycle management, enterprise resource planning, and manufacturing execution systems, have been in use for many years, representing that the market is mature. Also, the introduction of analytics and AI-driven systems is expected to be a key driver of segment growth.

The smart manufacturing market has been segmented into machine execution systems (MES), programmable logic controller (PLC), enterprise resource planning (ERP), SCADA, discrete control systems (DCS), machine vision, 3d printing, plant lifecycle management, and plant asset management based on technology. The DCS technology segment is expected to dominate the global market, and it is projected to reach USD 116 billion by 2030, registering a CAGR of 12% during the forecast period. 

For procedures like controlling, monitoring, and reporting, DCS is versatile and easy, which has helped it gain market share. DCS also includes characteristics like regulating and redundancy, which improve systems reliability. Leading key players are likely to launch DCSs for various industry verticals, driving growth.

The smart manufacturing market has been segmented into automotive, aerospace & defense, chemicals & materials, healthcare, industrial equipment, electronics, food & agriculture, oil & gas, and others based on end-use. The automotive end-user segment is expected to dominate the global market, and it is projected to reach USD 200 billion by 2030, registering a CAGR of 14% during the forecast period. 

Benefits such as sustainability, quality, asset efficiency, and cost savings given by smart factory solutions are essential elements driving category growth. Furthermore, adopting and investing in the smart factory is predicted to provide automobile manufacturers with competitive benefits such as improved profitability, faster time to market, higher product quality, and a more stable labor force. Smart manufacturing solutions in the automotive sector include the automation of entire manufacturing plants, testing and simulation, and consumer connectivity.

 

Regional Analysis of the Smart Manufacturing Market

Supremacy of Asia-Pacific Over Others

The global smart manufacturing market share has been segregated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. 

Smart Manufacturing Market Regional Analysis

Regional Growth Insights Request Sample Pages

With a market value of USD 304 billion by 2030, registering a CAGR of 14%, Asia-Pacific is expected to be the largest smart manufacturing market. SMEs are set to propel the application of smart manufacturing solutions due to the robust ecosystem in countries like Japan, India, and Australia. Large businesses in discrete sectors, on the other hand, are expected to produce the most income in the market. 

Disruptive technologies such as Industry 4.0, AI, augmented reality, the Internet of Things (IoT), and others push the region's cloud usage. As a result, cloud-based smart manufacturing solutions are likely to become more prevalent. As a result, cloud-based smart manufacturing solutions are becoming more common, driving regional growth.

North America is expected to be the second-largest smart manufacturing market with a market value of USD 180 billion by 2030, registering a CAGR of 11%. Canada and the United States are investing more in modern industrial technologies. The introduction of the smart manufacturing concept has been accelerated by technological advancements, the availability of substitute printing materials, and lower equipment prices. 

The North American aerospace & defense, health, industrial, and automotive industries are all seeing significant investment efforts expected to grow significantly in the future. Various government bodies, such as NASA, have identified significant 3D Printing R&D investments that can contribute substantially to space applications and produce new technologies to fuel economic expansion.

 

Players of the Market

  • Siemens AG
  • General Electric
  • Rockwell Automation
  • Schneider Electric
  • Honeywell International Inc.
  • Emerson Electric
  • Fanuc
  • Robert Bosch GmbH
  • Mitsubishi Electric Corporation
  • ABB
  • HP Development Company

 

Recent Developments

  • September 2021- Honeywell International, Inc. created the 'Smart Flexible Depalletizer,' a robotic device that reduces labor-intensive work. This technology enhances warehouse productivity while lowering worker injuries.
  • March 2021- Connectix is a new line of intuitive software products and expert services from General Electric. The service is intended for use in smart manufacturing. The services enable manufacturers to use data analytics to improve energy efficiency, make faster choices, and improve day-to-day operations.
  • February 2021- ABB has developed a cobot portfolio in the GoFa and SWIFTI cobot families. These cobots will complement YuMi and Single Arm YuMi in ABB's cobot portfolio, increasing payload capacity and faster robot mobility.
  • January 2021- Rockwell Automation, Inc. has released the QuickStick HT, an improved intelligent conveyor system. The innovative QuickStick HT 5700 inverter has been installed in the newly introduced conveyor system. The revised plan has improved functional safety while reducing plant floor space and controlling cabinet size.
  • May 2020- MELFA ASSISTA is a robot family developed by Mitsubishi Electric Corporation. MELFA ASSISTA works with people to perform safety functions such as collision avoidance. The robot also complies with international safety standards and regulations such as ISO 10218-1 and ISO / TS15066. MELFA ASSISTA and RT VisualBox are being used by businesses to improve efficiency.

 

Global Smart Manufacturing Market: Segmentation

By Component

  • Hardware
  • Software
  • Services

By Technology

  • Machine Execution Systems (MES)
  • Programmable Logic Controller (PLC)
  • Enterprise Resource Planning (ERP)
  • SCADA
  • Discrete Control Systems (DCS)
  • Machine Vision
  • 3D Printing
  • Plant Lifecycle Management
  • Plant Asset Management

By End-Use

  • Automotive
  • Aerospace & Defense
  • Chemicals & Materials
  • Healthcare
  • Industrial Equipment
  • Electronics
  • Food & Agriculture
  • Oil & Gas
  • Others

By Regions

  • North America
  • Europe
  • Asia-Pacific
  • Latin America
  • The Middle East and Africa
Report Metric Details
Market Size USD in Billion By 2030
CAGR CAGR 12%
Historical Data 2019-2020
Base Year 2021
Forecast Period 2022-2030
Forecast Units Value (USD Million)
Report Coverage Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends
Segments Covered by Component (Hardware, Software, Services), Technology (MES, PLC, ERP), End-Use (Automotive, Healthcare)
Geographies Covered North America, Europe, Asia-Pacific, LAME and Rest of the World
Key Companies Profiled/Vendors Siemens AG, General Electric, Rockwell Automation, Schneider Electric, Honeywell International Inc., Emerson Electric, Fanuc, Robert Bosch GmbH, Mitsubishi Electric Corporation, ABB, HP Development Company,
Key Market Opportunities The Technology Industry'S Substantial Growth Fuels The Smart Manufacturing Market
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