Global Smart Manufacturing Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Global Smart Manufacturing Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Global Smart Manufacturing Market is expected to register a CAGR of 6.1% during the forecast period. The rise of Industry 4.0 and the IIoT has made the market more accessible, as it has become easier to turn machines in the manufacturing industry into a form of smart and connected. It has made manufacturing processes and stages available through one control center and wearables, increasing its accessibility, operational processes, and ease of use.

Key Highlights

• Smart manufacturing initiatives are also on the rise. Smart Manufacturing Leadership Coalition (SMLC), a combination of US‐based industrial organizations, technology suppliers, laboratories, and universities, is working on a next-generation Smart Manufacturing Platform and Smart Factory connectivity. Similarly, the Industrial Internet Consortium (IIC), another industry‐led initiative, was established to bring together advanced technologies and organizations necessary to accelerate the growth of industrial automation.
• The use of software and services, such as PLC, SCADA, ERP, DCS, HMI, PLM, and MES, has enabled the industries to gather real-time data and make decisions based on them. This software has been beneficial for the industry in reducing the faults in the product, reducing downtime, scheduling maintenance, switching from reactive to predictive and prescriptive stages, and decision making.
• According to Cisco, by 2022, machine-to-machine (M2M) connections that support IoT applications are likely to account for more than half of the world's 28.5 billion connected devices. Manufacturers across the world also understand that the next generation of robotics and automation technologies is a revolutionary opportunity to upgrade manufacturing in terms of productivity, quality, safety, and cost metrics. Also, increased year-on-year robotic automation expenditure is mainly expanding the scope of the studied market further.
• The dependence on process control and systems combined with the convergence of IT and operating technologies systems has increasingly exposed manufacturing firms to cyber attacks. Manufacturers' control systems have long been deemed impenetrable due to their proprietary and customized networks. IoT has opened the scope for the theft of proprietary information. With more automation and digitization of these devices, which were originally built without the proper security measures, the data security concern will also grow, hindering the market growth.
• The outbreak of COVID-19 has triggered the manufacturing sector to re-evaluate its traditional production processes, primarily driving the digital transformation and smart manufacturing practices across the production lines. The manufacturers are also forced to devise and implement multiple new and agile approaches to monitor product and quality control.

Key Market TrendsAutomotive Industry is Expected to Drive the Market Growth

• Automotive manufacturing is expected to gain strong impetus from smart technologies, Industry 4.0, IoT, etc. Discrete manufacturing is the manufacturing or production of distinct parts that can be individually touched and counted. The pieces are mainly related to assembly lines. Discrete manufacturing includes products, such as cars, automotive parts, etc., that are increasingly connected.
• Smart manufacturing is expected to help balance supply and demand, enhance product design, optimize manufacturing efficiency, and significantly reduce waste. Field devices, like robotics, sensors, etc., and ICS offer opportunities to the automotive sector to react faster to market requirements, reduce manufacturing downtimes, enhance supply chain efficiency, and expand productivity.
• Smart manufacturing addresses the prime concern of the automotive industry, i.e., the length of a project. Quick return-on-investment projects combined with low-cost automation and cost innovation are helping manufacturers improve competitiveness through productivity improvement.
• The automotive industry has invested billions into developing edge computing technology. According to Ericsson's projections, the global number of connected vehicles may grow to around 700 million by 2025. The data volume transmitted between vehicles and the cloud may be about 100 petabytes per month.
• Further, according to UBS, Europe's projected electric vehicle sales are expected to reach 6.33 million units by 2025, followed by China, with 4.84 million units. As Europe and Asia-Pacific are leading the electric vehicles' demand, the regions are anticipated to see an increase in smart automotive factories' implementation.

Asia Pacific Region to Occupy a Major Market Share

• China's manufacturing industry has retained higher growth over the past decade and has become the largest manufacturing country on a global scale. In several industries, including steel, most global production comes from China.
• Traditionally seen as the world's manufacturing factory, China has spent significant effort to transform from (cheap) labor-intensive manufacturing to high-end manufacturing through digitalization and industrialization. According to GSMA, China may account for one-third of the global IIoT market by 2025.​
• Manufacturing has also emerged as one of the high-growth sectors in India. 'Make in India' program places India on the world map as a manufacturing hub and gives global recognition to the Indian economy.
• Government plays an important role in implementing the use of cases of IIoT in the region. Government initiatives, like Digital India and Make in India, are adding impetus to the Indian manufacturing industry. IoT immensely benefits the Make in India campaign by providing innovative ways to sustain manufacturing organizations' sustainable development.​
• Moreover, India's government aims for a USD 5 trillion economy by 2025, of which manufacturing may be worth USD 1 trillion. The convergence of flagship programs, such as Make in India with Skill India and Digital India, may be key to achieving this goal, thereby driving the country's market growth.​

Competitive Landscape

The smart manufacturing market is highly competitive and consists of several major players. The major players with star shares in the market focus on expanding their customer base across foreign countries. The companies leverage strategic collaborative initiatives to increase their market share and profitability. The companies operating in the market are also acquiring start-ups working on autonomous delivery robot technologies to strengthen their product capabilities.

• July 2021 - Rockwell Automation announced the acquisition of Plex Systems for USD 2.22 billion to expand its industrial cloud software offering. Plex Systems is a pure software-as-a-service, cloud-native smart manufacturing platform operating at scale.
• June 2021 - Deepak Fertilizers and Petrochemicals Corporation Limited (DFPCL) selected Honeywell Automation India Ltd. to convert their sprawling facility in Taloja, Maharashtra, into a Smart Factory. Honeywell also provided DFPCL with Managed Security Services, which would reduce the risk and impact of cyber-related disruptions and enable safer management of key elements of their ICS and OT.
• March 2021 - FANUC and Rockwell Automation formed a coalition to address the manufacturing skills gap with robotics and automation apprenticeship programs designed to upskill current and future workers for advanced manufacturing, robotics, and automation jobs. The coalition has developed new apprenticeship programs offering people opportunities to gain credentials, including fundamental robotics (Robot Operator) and automation (PLC Operator). The program provides a second level of certifications for Robot and PLC Technicians.

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