Smart Manufacturing Market is estimated to be valued at USD 223.90 Mn in 2025 and is expected to reach USD 340.7 Mn in 2032, exhibiting a compound annual growth rate (CAGR) of 6.18% from 2025 to 2032.
Increasing investment by leading companies will contribute to the growth of the smart manufacturing market over the next several years. The rising need to reduce downtime and costs is expected to fuel the market. Increased automation has been a major factor driving the market. This market is also expected to expand rapidly due to the demand for software solutions.
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Smart manufacturing is changing due to artificial intelligence, which makes predictive maintenance, intelligent automation, and real-time optimization possible. AI looks at data from sensors and machines to cut down on downtime, improve quality, and make things work better. It supports robotics, digital twins, and adaptive production systems, which help businesses stay competitive and environmentally friendly. AI is a key driver of Industry 4.0 adoption around the world considering it helps manufacturers make decisions faster, save money, and be more flexible.
For instance, in August 2025, Intel and LG Innotek are working together to build a smart factory in South Korea that uses AI. The partnership combines AI, IoT, and advanced analytics to improve production, allowing for predictive maintenance, quality control in real time, and automation. This project makes it easier for companies to adopt Industry 4.0, which will make semiconductor and electronics manufacturing around the world more efficient.
In terms of technology, the manufacturing execution system (MES) segment is expected to lead the market with 26.5% share in 2025 by enabling real-time monitoring, production scheduling, and integration with IoT and AI. It bridges shop-floor operations with enterprise systems, ensuring efficiency, predictive maintenance, and quality control. Its role in digital transformation makes it the backbone of Industry 4.0 adoption worldwide.
For instance, in May 2025, Rockwell Automation released FactoryTalk PharmaSuite 12.00, a new manufacturing execution system (MES) for the pharmaceutical and biopharmaceutical industries. The solution improves real-time monitoring, scalability, and compliance by combining IoT and AI to make production easier. Its modular, cloud-ready design helps with the shift to Industry 4.0, which boosts efficiency and digital innovation in smart manufacturing.
In terms of component, the control devices segment is expected to hold the highest share of the market in 2025. Control devices, including PLCs, sensors, robotics, and machine vision systems, lead the component segment in 2025. They form the foundation of automation, enabling precise control, monitoring, and connectivity across manufacturing processes. Their indispensable role in smart factories drives widespread adoption, making hardware the largest revenue contributor in smart manufacturing.
For instance, in October 2025, OMRON opened its Automation Center in Bengaluru, India. They showcased advanced control devices like PLCs, sensors, robotics, and machine vision systems. The facility helps with the adoption of Industry 4.0 and India's "Make in India" initiative. It does this by encouraging automation, efficiency, and innovation in smart manufacturing in the automotive, food, packaging, and semiconductor industries.
In terms of end-use industry, the automotive segment is projected to account for 31% share of the market in 2025, driven by electric vehicle production, autonomous technologies, and digital twin integration. Heavy investments in robotics, IoT, and AI-powered assembly lines enhance efficiency and flexibility. Automotive manufacturers lead Industry 4.0 transformation, making this sector the largest consumer of smart manufacturing solutions.
For instance, in February 2025, Hyundai Motor and Samsung have launched private 5G RedCap technology that will assist with smart manufacturing in the automotive industry. The new technology provides secure, low-latency connections for IoT devices, robots, and digital twins, which improves real-time monitoring and predictive maintenance. This partnership makes it easier for companies to adopt Industry 4.0, which helps with the production of electric vehicles and the assembly of next-generation cars.
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Asia Pacific dominates the smart manufacturing market with 46.1% share in 2025, due to rapid growth of manufacturing industry in countries such as China and India across the region. Manufacturing is one of the major features of China’s economy, which continues to grow. Furthermore, with increasing government initiatives, the manufacturing sector among these countries are witnessing strong growth. Thus, the region is expected to gain substantial growth in the global smart manufacturing market over the forecast period.
For instance, in September 2025, At Electronica India 2025 in Bengaluru, Kyocera unveiled high-tech electronic parts, fine ceramics, sensors, and tools for the industrial sector. These new technologies make smart manufacturing possible by making automation, the Internet of Things (IoT), electric vehicles (EVs), aerospace, and 5G infrastructure possible. The company's high-reliability materials and precision technologies help more businesses adopt Industry 4.0, which leads to more efficiency and digital transformation in all fields.
North America is expected to exhibit the fastest growing in the global smart manufacturing market over the forecast period. This can be attributed to industrial revolution, in which data is used on a large scale for production, while the data is integrated with a variety of manufacturing systems in the supply chain in the U.S. Moreover, the growing automotive markets in the country, along with increasing economy of Canada with constant growth in past few years are also expected to drive growth of the market in the region.
For instance, in September 2025, In Hagerstown, Maryland, USA, Hitachi Rail opened a $100 million digital smart factory. The facility uses AI, IoT, digital twins, and 3D printing to make 20 railcars every month. It drives the adoption of Industry 4.0 by operating with no carbon emissions and no waste going to landfills. This creates 460 jobs and helps the economy grow in the region.
The "Made in China 2025" plan, along with the rise of robotics, industrial automation, and electric vehicle production, will drive demand for smart manufacturing in China in 2025. China is the world leader in Industry 4.0, with more than 54% of new industrial robot installations and the most clean-energy vehicles. It does this by using AI, IoT, and green technologies.
For instance, in November 2025, At the 2025 World Intelligent Manufacturing Conference, China stated it has built more than 7,000 smart factories, including 500 that are at the "excellence" level and 15 that are "pioneer" companies. The industry is now worth 4.5 trillion yuan, making China the world's largest intelligent manufacturing hub and giving the country more power in Industry 4.0.
Industry 4.0 adoption, digital twins, AI, IoT, and robotics are going to fuel demand for smart manufacturing in the U.S. in 2025. Investing in sustainability, cybersecurity, and workforce development by the federal government makes businesses more competitive. Advanced automation in the automotive, aerospace, and electronics industries makes things run more smoothly. At the same time, carbon-neutral factories and predictive analytics speed up the digital transformation across the country.
For instance, in November 2025, the National Smart Manufacturing Research Center is scheduled to be built in California, USA, with the support of $7.5 million from Cal Poly Pomona. The center will help Industry 4.0 technologies like AI, IoT, robotics, and digital twins move forward. It will focus on sustainability, workforce development, and innovation to make U.S. smart manufacturing more competitive around the world.
| Report Coverage | Details | ||
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| Base Year: | 2024 | Market Size in 2025: | USD 223.90 Mn |
| Historical Data for: | 2020 To 2024 | Forecast Period: | 2025 To 2032 |
| Forecast Period 2025 to 2032 CAGR: | 6.18% | 2032 Value Projection: | USD 340.7 Mn |
| Geographies covered: |
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| Companies covered: |
Yokogawa Electric Corporation, ABB Ltd., Texas Instruments Incorporated, Emerson Electric Company, Siemens AG, Fanuc Corp., Schneider Electric SE, General Electric Co., Rockwell Automation Inc., Honeywell International Inc., Robert Bosch GmbH, and Mitsubishi Electric Corporation |
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Automation has become highly accessible to manufacturers due to development of novel technologies, and this is changing the way of operations among several companies. The demand for automation is increasing all over the world in order to gain efficiency and quality. The adoption of automation has increased in manufacturing sector through smart technologies, as it helps achieve enhanced productivity with efficiency to operate in more protective and advanced environment. Thus, increasing demand for automation is expected to propel growth of the global smart manufacturing market over the forecast period.
Due to digitization in industries, efficiency and optimum resource management has improved in recent years. Digitization of industrial sector is different in every industry depending on whether the focus is on automation or connected systems. Processing and Manufacturing industries are realizing the potential of using advanced technologies and deploying smart and connected systems, as it enables end-to-end visibility of industrial supply chain. Thus, need for digitization has increased in several sectors including manufacturing, and as a result, it is creating need for compliance and support from government. These factors are anticipated to fuel growth of the global smart manufacturing market over the forecast period.
Industrial revolution in manufacturing industries is expected to offer several growth opportunities in the global smart manufacturing market over the forecast period. Manufacturing industries around the world are undergoing a revolution, which is also being termed as Industry 4.0 or the fourth industrial revolution. This revolution is being driven by technologies such as IoT, Artificial Intelligence, Cognitive Technologies, Automation, and Machine Learning. Thus, smart factories have now adopted such technologies and have integrated them in their lines of production. These factors thus, are expected to offer multiple opportunities in the market.
Growing industrial automation to create lucrative environment for growth opportunities in the global smart manufacturing market over the forecast period. Along with increasing global inclination towards cost-effective and better-quality control, automation of industrial processes is likely to grow significantly in the coming future. In this, machine learning is anticipated to pay a crucial role in the future in regards with automating complicated operations. Thus, the market will several business opportunities in the coming future.
Data monetization is anticipated to play an important role in smart manufacturing in the future. There will be more customization in factories facilitated by demand identifying data, minimizing the downtime required for reset and retool. Along with this, augmented reality is also expected to be a significant feature in the smart manufacturing in the future, specifically in highly complex lines of assembly. Thus, the growing trend of data monetization is expected to propel growth of the market during the forecast period.
The smart manufacturing market is a vital component of modernizing industry, and it is driven by the use of digital technologies in all parts of production. Data from the industry show that most large and medium-sized manufacturers have at least one smart manufacturing solution. Estimates say that about 70% of manufacturers are using technologies like industrial IoT, advanced analytics, artificial intelligence, or automation to make their operations more efficient and make better use of their assets. An increasing number of these systems are being used in discrete, process, and hybrid manufacturing facilities.
Regional deployment trends indicate that Asia Pacific is a major implementation hub. This is due to there are plenty of electronics, automotive, and machinery manufacturing facilities there, and companies are investing in automation. North America continues to leverage cloud-connected manufacturing execution systems and predictive maintenance platforms a lot. In Europe, on the other hand, the focus is on optimizing energy use, creating digital twins, and monitoring processes that are required by law. Surveys show that more than 60% of smart factories use edge computing to make decisions in real time, which reduction down on latency and makes production more responsive.
Digital twins, industrial robotics, and AI-enabled quality inspection are three areas where technology is really taking off. More than two-thirds of advanced manufacturing sites now use digital twins, which help with simulation-based optimization and less downtime. Automotive and electronics manufacturing are still the most important end-use segments due to their supply chains are complicated and they need to be very precise. In general, smart manufacturing is moving from pilot projects to full-scale use in businesses. This could result in more productivity, less unplanned downtime, and better traceability, all of which will contribute to helping the market grow over time.
Definition: Smart manufacturing is a technology-driven revolution in the manufacturing industry that uses connected robotics and artificial intelligence. It improves productivity and agility, reduces costs and complexity, and helps businesses prepare for unexpected events.
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About Author
Ramprasad Bhute is a Senior Research Consultant with over 6 years of experience in market research and business consulting. He manages consulting and market research projects centered on go-to-market strategy, opportunity analysis, competitive landscape, and market size estimation and forecasting. He also advises clients on identifying and targeting absolute opportunities to penetrate untapped markets.
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