Impact Analysis of Covid-19
The complete version of the Report will include the impact of the COVID-19, and anticipated change on the future outlook of the industry, by taking into the account the political, economic, social, and technological parameters.
Market Insight- Global Smart Factory Market
A smart factory is a highly digitized and connected production facility that depends on smart manufacturing. The concept of the smart factory is considered a crucial outcome of the fourth industrial revolution, i.e. Industry 4.0. Manufacturing companies are the major adopters of smart factories where they employ cutting-edge technologies such as artificial intelligence, Internet of Things, big data, analytics, and robotics. These factories can run autonomously on a large scale with the ability to self-correct. A smart factory offers visibility, autonomy, and connectivity. Although companies have already employed automation, smart factories are a step further and run without human intervention. Since modern technologies are incorporated, smart factories can learn and adapt in real-time, making them more flexible than their predecessors.
The global smart factory market is estimated to account for US$ 116.3 Bn in terms of value in 2019 and is expected to grow at a CAGR of 13.3% during the forecasted period 2019-27.
Market Dynamics- Drivers
- Growing demand for smart factory from key verticals is expected to drive growth of the global smart factor market during the forecast period
Many industry verticals such as automotive and transportation, electronics, and electrical industries are focused on adoption of smart factory solutions, in order to augment efficiency and increase production capabilities. Furthermore, a number of manufacturing verticals are adopting smart factory solutions, in order to reduce production of defective products, downtime, and wastage. At the same time, they are focused on improving productivity. Apart from automobile and electronics manufacturing, smart factory is being adopted in chemical, oil & gas, textile and food & beverage industries. Hence, these factors are expected to boost growth of the market during the forecast period.
- Increasing focus on advanced manufacturing is expected to propel the global smart factory market growth over the forecast period
Increasing demand for advanced manufacturing practices is expected to support the market growth in the near future. Advanced manufacturing involves production of goods with minimum resources while maintaining cost and improving performance. Hence, the demand for smart factories globally is increasing significantly. Therefore, these factors are expected to propel the global smart factor market growth over the forecast period.
Asia Pacific region dominated the global smart factory market in 2019, accounting for 35.6% share in terms of value, followed by Europe and North America, respectively.
Source: Coherent Market Insights
Market Dynamics- Restraints
- Low availability of skilled personnel is expected to hamper the global smart factory market growth during the forecast period
There is a severe shortage of skilled personnel and the skill gap of current workforce is creating challenges for the market. In emerging regions such as Africa and Latin America, this problem is severe. However, the situation is expected to change in the near future due to growing awareness regarding automation and smart factories in the region. Thus, these factors are expected to hamper the market growth in the near future.
- Concerns regarding data theft information security are expected to restrain growth of the global smart factor market over the forecast period
Smart factories enable intensive digital communication between different machines, across divisions, companies, and industries. Critical information is shared across various channels through internet, which increases concerns related to information and data security. Moreover, this risk is even higher when information is shared across external networks. Hence, these factors are expected to restrain growth of the global smart factory market during the forecast period.
- Rising adoption of collaborative robots can provide major growth opportunities
Collaborative robots or cobots are intended to interact with humans in a shared space or work safely in close proximity. Since these robots are designed to work autonomously with safety assured by isolation from human contact, they are better than conventional robots. For instance, in September 2014, ABB Limited introduced a collaborative robot named YuMi, which is human-friendly, dual armed and designed for the new era of automation.
- Increasing investments in manufacturing plants are expected to present lucrative opportunities for market players
Rising global competition is encouraging manufacturers to adopt technologies that enhance efficiency and productivity at manufacturing units. Across the globe, numerous product manufacturers are investing significantly in incorporating the latest technologies and solutions to enhance manufacturing capabilities. For instance, in April 2015, GE invested over US$ 200 million on its new multi-modal smart factory in India.
Source: Coherent Market Insights
In global smart factory market, by component segment defense, hardware sub-segment dominated the global smart factory market in 2019, accounting for 45.2% share in terms of value, followed by software and services.
Source: Coherent Market Insights
- North America Trends
Rising demand for industrial robots in the region
The demand for industrial robots is increasing significantly, owing to rising automation in manufacturing plants, since it accelerates production and enhances the quality of products. For instance, the Robotic Industries Association (RIA) reported that the number of robot units ordered from North American companies increased by 28% between 2013 and 2014. Moreover, during the same period, the number of robots shipped to North American companies increased by 13%.
- Latin America Trends
Increasing investments in automobile manufacturing plants
In Latin America, a number of global automobile manufacturing companies have increased investments in the recent past. This trend is expected to grow of smart factories in the near future. For instance, in April 2015, Ford Motor Company announced an investment of US$ 2.2 Bn for a new engine and transmission plants in Mexico. Furthermore, in December 2015, Hyundai Motor Company decided to invest US$ 130 Mn in its new plant in Mexico.
Key players operating in the global smart factory market are Oracle Corporation, ABB Group, Atos SE, Rockwell Automation, Inc., Accenture PLC, General Electric Co., PTC Inc., Siemens AG, SAP SE, and IBM Corporation.
- Key players in the market are focused on partnerships and collaborations, in order to enhance the market presence. For instance, in January 2020, Oracle Corporation partnered with Mitsubishi Electric to develop Internet of Things (IoT)-enabled platform for smart manufacturing.
- Major companies in the market are involved in capacity expansion, in order to gain a competitive edge in the market. For instance, in March 2018, ABB Group inaugurated its one of the first smart factories in Bangalore for production of electrical protection and connection solutions.