Smart Manufacturing Market Growth Driven by Industry 4.0 Adoption

The global smart manufacturing market was valued at USD 254.24 billion in 2022 and is anticipated to grow at a CAGR of 14.9% from 2023 to 2030. The market is expanding at a faster rate due to factors such as rising Industry 4.0 adoption, more government engagement in supporting industrial automation, increased emphasis on industrial automation in manufacturing processes, surging demand for software systems that save time and cost, increasing supply chain complexities, and increased emphasis on regulatory compliances. COVID-19 pandemic had an impact on or induced the shutdown of all industries and elements involved in industrial automation. The global supply chains and operational logistics were suddenly affected during initial worldwide lockdown.

The market became more focused on manufacturing essential products to survive during the pandemic as demand for non-essential products reduced. However, the market was able to grow during pandemic as enterprises needed to provide their services and products safely and quickly. The market grew during this unusual event as a direct result of demand, government financial assistance, and technical support.

Information technology and automobile industries are two most prevalent industries for industry 4.0. The market has helped automotive manufacturers build automated assembly lines not only for parts but also to manufacture the entire car. For instance, in 2021, Audi used its Production Lab (P-Lab) department to create real-life use cases for modern technology in everyday manufacturing. Industrial automation has developed an in-depth and in-demand market based solely on benefits and opportunities it offers other industries. Regardless of industry, every company or manufacturer aims to apply smart manufacturing to their processes, thus increasing the overall market.

 

Gather more insights about the market drivers, restrains and growth of the Global Smart Manufacturing Market

 

Detailed Segmentation:

Component Insights

Software segment accounted for a largest revenue share of 49.6% in 2022 and is likely to dominate the market over the forecast period. As industry is pushing towards full automation, the software component is the backbone of the industry. Advanced software will help run robots, drones, and other machines without human interruption, reducing the chance of any error. With the help of software, the market can make large strides in development and research for newer and more versatile solutions.

 

Technology Insights

Discrete control system segment accounted for a largest market share of 16.1% in 2022 and is predicted to lead the market over the forecast period. Discrete control system technology runs in background and offers control and monitor functions to the administrator. The market offers basic and advanced level technological control and overview of every process. This combination of technology and industrial automation makes the market accessible even remotely.

 

End-Use Insights

Automotive industry registered a largest revenue share of over 24% in 2022 and is anticipated to grow at a highest CAGR of 15.6% over the forecast period. Many automotive manufacturers are running at very minimal profits, so they turn towards smart manufacturing to reduce waste and cost and to increase their margins. The market also helps automotive companies maintain a high level of standardization of their products. Primarily, industry 4.0 helps automotive industry to run around the clock and reduce labor wages if any.

 

Regional Insights

Asia Pacific region accounted for a largest market share of 36.7% in 2022. The region is also anticipated to be the fastest-growing region over the forecast period. Developing countries like India and China have vast unexplored opportunities and are aiming toward full automation in smart manufacturing. These countries also want to be independent in terms of production and manufacturing, so they invest heavily in industry 4.0. Latin America is expected to grow at a significant CAGR of 15.3% during the forecast period.

Latin American market for innovation and automation is aggressively penetrated, resulting in normalization of smart manufacturing. Since the modern technological revolution has only recently begun in Latin America, opportunities in smart manufacturing are expanding. The region is also close to and accessible to various raw materials, which aids in smart manufacturing and drives the growth of the market.

 

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Key Companies & Market Share Insights

The global smart manufacturing market has a high number of small and medium-level players who are often operating for big established manufacturers. Many small-level players in the market are in the Asia Pacific region as the market is still developing here. As technology evolves, so does the specification and type of products to be manufactured, with industrial automation the process is streamlined, and the market grows alongside the evolution. The North American and European markets are dominated by large and medium-level companies in the market.

 

Competition in this market is high, although technological advancements are allowing companies to save time and cost while increasing their efficiency and effectiveness. Constant research and development are leading to the industry becoming more common and standard even if it requires some investment. Due to globalization, the smart manufacturing trend is present in global markets over boundaries. Seeing the growth potential, even governments are offering schemes and policies for investors to bring markets to their countries. Some of the prominent players operating in the global smart manufacturing market include:

• ABB Ltd.
• Siemens
• General Electric

 

• Rockwell Automation Inc.

 

• Schneider Electric

 

• Honeywell International Inc.

 

• Emerson Electric Co.

 

• Fanuc UK Limited

 

Recent Developments

 

• In April 2023, Honeywell International, Inc. acquired Compressor Controls Corporation (CCC), a provider of turbomachinery control and optimization solutions, for USD 670 million. This acquisition is expected to strengthen their presence in automation, industrial control, and process solutions. The ongoing development is expected to help industry grow exponentially in coming years.

 

• In April 2023, ABB is expected to invest USD 170 million in the U.S. market to create highly skilled jobs in manufacturing, innovation, and distribution operations. This investment is expected to create more demand for electrification and automation products.

 

• In April 2023, Robert Bosch GmbH partnered with Rhenus Automotive and REMONDIS subsidiary TSR Recycling, to develop Europe’s first fully automated battery-discharging plant. The plant will be a fully automated system for disassembling and discharging battery modules, which is expected to augment the industry growth further.

 

• In June 2023, Schneider Electric partnered with ArcelorMittal Nippon Steel India for hi-tech training on smart manufacturing. The partnership also includes smart labs and training labs for NAMTECH, an education initiative by AM/NS India, which will be developed by Schneider Electric.

 

• In May 2023, Rockwell Automation Inc. collaborated with autonox Robotics, for the expansion and invention of robot mechanics. This partnership is expected to bring Kinetix motors and drives of Rockwell along with the autonox’s robot mechanics to achieve new manufacturing possibilities.

 

• In March 2022, Mitsubishi Electric Corporation updated their software iQ Works2 and RT Toolbox3. A new visual editor for SCADA and six-axis industrial robot programming is part of their latest update in the software. The upgrade also includes improved user-friendliness, which is expected to simplify the setup of automated applications.

 

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