Rampant Advances in Technology to Influence Smart Manufacturing Market Growth
Pervasiveness of technology has not left any sector untouched and manufacturing is no exception. The increasing perimeter of Internet of Things, big data, AI/ML and 5G has significantly transformed the manufacturing industry placing it inline with the proliferating Industry 4.0. Emergence of 5G technology is expected to transform the existing IIoT (Industrial Internet of Things) based applications used in smart manufacturing. By leveraging 5G, the future of smart manufacturing and related IoT ecosystems looks promising owing to increased scalability, security, reliability and individual control.
Given the benefits and features of 5G such as high speed (in gigabytes/second), capacity to tackle high volumes and measure latency in single milliseconds is instrumental in driving growth of the smart manufacturing market. This, in turn has the ability to enhance the global Gross Domestic Product from manufacturing sector. For instance, according to Huawei Technologies, 5G technology has a higher potential to significantly fuel global manufacturing GDP by 2030. In this backdrop, broadening applications of modern technologies are expected to augur well for the smart manufacturing market.
As per industry reports, the global smart manufacturing market stood at around US$90 Bn in 2021 and is projected to expand at a significant rate of over 18% in the next five years. Revenue generated from Asian countries is expected to increase at higher pace accounting for over 35% share.
Backed by Government Investments, the Smart Manufacturing Market to Experience Significant Momentum
Impact of COVID-19 and associated restrictions disrupted several businesses worldwide, consequently impacting global economy. To overcome the aftermath of the pandemic and lockdown scenario, businesses have been focused on reconstructing their models backed by government support. The manufacturing sector, in particular, has undergone a significant transformation on the back of increasing investments in smart manufacturing initiatives coupled with technology advancements. In order to overcome challenges apropos to manufacturing and associated supply chains, governments of various countries such as India, UK and Germany are reconstructing their respective nation’s GDP.
To expedite this, they are investing in various manufacturing projects in order to improve cash flow and ensure financial stability. For instance, the Government of India announced an investment of INR 1.97 lakh crores (more than US$ 26 billion) in the 2021-22 Union Budget for PLI schemes (Production Linked Incentive) focusing on 13 manufacturing sectors in the country. Likewise, according to ITUC (International Trade Union Confederation), Government of Germany raised an investment of around US$ 140 billion in 2020 as an attempt to cope with the SARS-CoV-2 pandemic. Moreover, as per International Trade Administration, about 84% of the manufacturers in Germany are planning to invest EUR 10 billion annually in smart manufacturing by 2025. Such initiatives and increasing support from government via investments is expected to give a significant momentum to the smart manufacturing market growth.
Digital Twins Likely to be the Most Used Enabling Technology
Adoption of digital twins as an efficient enabling technology is expected to largely contribute to the growth of the smart manufacturing market. Digital twin technology is increasingly being used as providing information of a physical product and associated characteristics in 3D format to the real world. This facilitates efficient functioning of the smart manufacturing system consequently enhancing the production output at minimal costs. By using digital twins, manufactures can significantly reduce costs and time associated with validating, installing or assembling production systems in the factory owing to its virtual representation method. This factor continues to influence the use of digital twins, thus complementing the smart manufacturing market growth.
Asia Pacific to Remain at the Vanguard of Growth
Manufacturing industry in Asia Pacific has remained robust since several years supported by favourable business environment including cheap land and labour and government incentives. Emerging economies in Asia Pacific such as India and China are likely to remain at the forefront of the smart manufacturing market. As these countries gear up for the revolutionary Industry 4.0, manufacturing activities are undergoing a sharp transformation. The region has become a hotspot for various industrial activities supported by IT advancements. Growing adoption of technologies such as IIoT, IoT and AI/ML has resulted in smart automation which is driving the smart manufacturing market. Moreover, initiatives carried out by governments in the region are likely to favour the market’s growth. For instance, the Made in China 2025, IVI (Industrial Value Chain Initiative) in Japan, Samarth Udyog Bharat 4.0 in India and the Manufacturing Innovation Strategy 3.0 or Strategy 3.0 in Korea are poised to pave potential pathways for adoption of technology in manufacturing industry in turn creating potential opportunities for smart manufacturing market. In this backdrop, companies can expect potential opportunities from the region in the coming years.
Smart Manufacturing Market: Competitive Landscape
Few of the key players in the smart manufacturing market include Siemens, ABB, Honeywell International Inc., Rockwell Automation, Schneider Electric, Emerson Electric Co., General Electric and IBM.
Global Smart Manufacturing Market is Segmented as Below:
By Information Technology:
By Enabling Technology:
Key Elements Included In The Study: Global Smart Manufacturing Market
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