Industry 4.0 Market Size, Share & COVID-19 Impact Analysis, By Application (Industrial Automation, Smart factory, and Industrial IoT), By Vertical (Manufacturing, Energy & Utilities, Automotive, Oil and Gas, Aerospace and Defense, Electronics and Consumer Goods, and Others), and Regional Forecast, 2021-2028

The global industry 4.0 market size was USD 101.69 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with industry 4.0 solution/services witnessing a positive demand shock across all regions amid the pandemic. Based on our analysis, the global market will exhibit a significant growth of 14.5% in 2020 as compared to the year-on-year growth during 2017-2019. The market is projected to grow from USD 116.14 billion in 2021 to USD 337.10 billion in 2028 at a CAGR of 16.4% in the 2021-2028 period. The steady rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

The rising internet penetration and digitization trends due to the increased focus of various industries on efficiency and cost-efficient productivity are boosting the Industry 4.0 market growth. Recent advances in digital technologies, along with industrial automation, have started extending the opportunity for industrial value chain disruption. With the emergence of the fourth industrial revolution (i4.0), companies are witnessing improved efficiencies, lower-cost benefits, increased output, customized offering, and, more significantly, the development of new revenue and business models.

Digital technologies, such as artificial intelligence, the internet of things, augmented and virtual reality, 3D printing, and blockchain are disrupting all elements of the value chain, including product designing, supply chain, manufacturing process, and customer experience. Further, global manufacturing industry giants such as Germany, United States, France, and Japan were being supported by strategic government initiatives to digitize their production processes across various industries.

COVID-19 Impact

COVID-19 to Uplift Demand Supported by Integration of Advanced Solutions in Business Operations

With the global market environment being ravaged by the COVID-19 pandemic, digitalization across industries is accelerating at a rapid rate. This presents a new opportunity for digital leaders to develop and adopt creative solutions to accelerate digital transformation at all levels of the company. The outbreak of the coronavirus is hastening the introduction of the fourth industrial revolution (Industry 4.0), propelling businesses across sectors to a higher level of internet of things (IoT) technology and workflow. The global supply chain is undergoing unprecedented instability as a result of the COVID-19 pandemic that has affected the entire planet. Some manufacturing firms have completely stopped production, while others have seen a significant decrease in demand, while few witnessed an increase in demand.

Enterprises, on the other hand, are implementing advanced technologies to mitigate the disruption caused by the virus spread. The role of supply chain management is becoming increasingly important in terms of risk management. Manufacturers that have not yet begun or are in the early stages of transitioning to this market, on the other hand, may face difficulties. In this scenario, flexibility in analyzing and adjusting inventory requirements, optimizing supply chains, and increasing manufacturing capabilities with advanced technologies will be crucial for manufacturers and enterprises globally. Moreover, favorable government initiatives are expected to help businesses sustain through the pandemic. For instance,

• In March 2020, the European Commission proposed a temporary framework that promoted the growth of advanced industry 4.0 solutions among small and medium-sized businesses.

Such initiatives are expected to boost the adoption of industry 4.0 technologies among the contextual environment of COVID-19.

LATEST TRENDS

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Predictive Maintenance Using Digital Twin Solution Will be a Significant Market Trend

As the Internet of Things (IoT) has grown in popularity in recent years, digital twins have attracted a lot of attention. A digital twin is a virtual model that follows the lifecycle of a physical entity or mechanism. This technology has allowed OEM manufacturers and automakers to remotely track and manage equipment and systems by providing near real-time insights between the physical and digital worlds. To spot bottlenecks, streamline processes, and innovate product growth, digital twin technology provides an unparalleled insight into assets and production.

Companies are incorporating digital twin technology that can detect anomalies and irregularities in operations immediately to gain a holistic view of the health and performance of the equipment. Spare component maintenance and replenishment can be scheduled ahead of time to reduce time-to-service and prevent costly asset failures. Predictive maintenance with digital twins would help OEMs generate new service-based revenue while also improving product reliability. Additionally, companies in the market are launching advanced digital twin solutions that aid in better visibility into equipment and offer greater operational efficiency. For instance,

• In February 2020, Huawei Technologies Co., Ltd., a digital technology company headquartered in China, launched site digital twins, a solution that creates the exact digital replica of a physical site that enables smoothened digital operations.


• In October 2018, Microsoft Corporation launched Azure Digital Twins, a platform that helps manufacturing companies and automakers gain extensive visibility into manufacturing operations and create models of projects they’re working on.

Such initiatives by key players are expected to contribute to the growth of the market in the forecast period.

DRIVING FACTORS

Increased Adoption of Industrial Robots is Expected to Drive Growth

Over the last few decades, robots have progressed from being prohibitively costly machines with minimal capabilities to being inexpensive machines capable of performing a wide range of tasks. Industrial robots, in particular, are widely used by people all over the world. According to the latest robotics industry trends, industrial robots are increasingly being used in manufacturing hubs, resulting in rapid advancements, development, and evolution.

The manufacturing sector has witnessed a growing acceptance of robotics engineering and technology in its production processes as a result of rapid technological advances in robotics. Industrial robots are multipurpose manipulator devices that are automatically controlled and programmable. Welding, heavy-lifting, ironing, assembling, pick and position, palletizing, product inspection, and testing are just a few of the popular industrial robot applications, all of which require a lot of human endurance, speed, and precision. The International Federation of Robotics (IFR) stated that there were approximately 2.1 million stand-alone industrial and automotive robots installed worldwide in 2017, with 381,000 robotic units shipped globally. Industrial robots perform repeatable tasks and eliminate the need for human labor. Furthermore, they can operate in hazardous and external risk that humans cannot. Thus, robotics technology will be a key trend with the growth of the industry.

RESTRAINING FACTORS

Data Risks Associated with Integration of Advanced Technologies to Restrict Growth

The integration and implementation of industry 4.0 solutions have several benefits, but they also pose multiple risks that could hamper business developments in the near future. The data and security challenges associated with the implementation of advanced technologies are expected to hamper the market growth. According to a study published by IBM Corporation in 2018, the X Force Threat Intelligence Index indicates that the manufacturing sector is the second-most targeted industry for data breaches and cyber-attacks. These technological systems are unable to prevent hackers from accessing the manufacturer's data and collecting all sensitive details due to their susceptibility to attacks. As a result, there is a need to raise consciousness about such threats and to comprehend the necessity of cybersecurity solutions at all levels of organizational networks.

SEGMENTATION

By Application Analysis

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Industrial IoT (IIoT) Segment to Gain Momentum during the Forecast Period

Based on the application, the market is classified into industrial automation, smart factory, and industrial IoT.

IoT in the industrial sector (Industrial IoT) combines advancements of two transformative revolutions. The possible benefits of IIoT technology have motivated several industrial equipment manufacturers to adopt IoT. By connecting the industrial equipment using wireless connectivity and gathering sensor data from the same, manufacturers are able to estimate the present state of machines, enhance their performance, and recognize potential failures while planning maintenance programs. Smart factories allow each customer's requirements to be satisfied profitably. In this industry, the dynamic business and engineering processes allow end-process changes to production and convey the ability to respond flexibly to disorders and failures in place of suppliers.

By Vertical Analysis

Manufacturing Segment to Capture Maximum Share in the Forthcoming Years

Based on the vertical, the market is further segregated into manufacturing, energy & utilities, automotive, oil and gas, aerospace and defense, electronics and consumer goods, and others. The manufacturing segment is estimated to dominate the global market during the forecast period. The automotive, transportation and chemical segments are projected to emerge as the most promising verticals implementing i4.0. The deployment of smart robots & machines in the manufacturing sector has witnessed an increasing trend over the past years. Investments in research and development are taking place to design an integrated system in which robots and humans can work on complex tasks together by utilizing sensor-connected human-machine interfaces.

The adoption of advanced solutions will be high in the automotive sector during the forecast period. Plants equipped with Industry 4.0 technology can track the production equipment and processes in order to detect possible problems before they cause production downtime. Automobile manufacturers that are Industry 4.0 ready can also configure individual vehicles and reduce the delivery time. Manufacturers must configure vehicle configuration in order to meet the changing customer demands. Unlike conventional auto production, the IIoT-enabled device allows for customization, such as the dashboard and steering wheel. Furthermore, the concept of self-driving vehicles has become a reality owing to Companies around the automotive ecosystem are investing heavily in product and manufacturing process innovations in order to stay competitive in the face of rapid technological growth.

REGIONAL INSIGHTS

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Geographically, the market is segmented across five major regions, namely, North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America.

Europe captured the maximum market share in 2020. The European industry has made a substantial investment in technologies and skills to maintain its position in the global market. The deployment of connected objects and automation techniques has transformed the German manufacturing process and has given rise to the fourth industrial revolution. The establishment of connectivity, networked objects, real-time data processing, and ubiquitous information is shifting paradigms in industries. Tech-giants, including Siemens, Honeywell, and General Electric, are among the early adopters of Industry 4.0 and are far ahead in its implementation.  

Since North American companies are increasingly embracing the concept of smart manufacturing, the region is expected to dominate the global Industry 4.0 market. The majority of factories operating in the market are now equipped with new machinery and smart factory technology, allowing other businesses to transition to smart manufacturing from conventional manufacturing methods. Major players operating in the market, government initiatives, and increasing funding in research and development activities are vital factors that make North America a dynamic region for the growth of the market.

The Asia Pacific market is led by Japan, China, and South Korea due to their exhaustive measures to adopt industrial automation and implement disruptive technologies in their manufacturing system value chain. In 2015, the Government in China launched a ten-year scheme called “Made in China” that would operate until 2025. The plan encompasses the top ten industries, including semiconductors, advanced robotics, electric cars, and artificial intelligence. This state-driven industrial policy aims to make China dominant in global high-tech manufacturing and has derived its inspiration from the German government’s Industry 4.0 development plan. Japan launched its Society 5.0 program, which is aimed to address the economic, social, and industrial challenges.

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In Latin America and the Middle East and Africa, the fourth industrial revolution is supported by government initiatives and the realization of the significance of adopting digital technologies to sustain in the global market. For instance, in September 2017, the U.A.E. government launched a strategy for the country’s I4.0 during the annual meetings. The strategy is designed to strengthen its position as a global hub for industry 4.0 and to proliferate its support to the national economy. Also, in Brazil, leading players have partnered up to stimulate the implementation of technological assets to speed up the adoption of advanced technologies.

KEY INDUSTRY PLAYERS

The Emphasis of Key Players on Mergers and Acquisition to Strengthen Competition

Oracle Corporation, Cisco Systems Inc., and others are some of the major players in the market. They are currently deploying advanced solutions integrated with digital twins and 3D printing, among others. Additionally, the high market competition is forcing key players to focus on the acquisition strategy for strengthening their positions. For instance,

• March 2020 - Cisco Systems Inc. collaborated with Microsoft Corporation to allow seamless data orchestration from Cisco IoT Edge to Azure IoT Cloud. This collaboration will empower customers to get a pre-integrated IoT edge-to-cloud application solution and seamless flow of data through IoT edge.


• February 2021 – Software and SAP SE partnered to combine SAP's S/4HANA Cloud with Software AG's analytics platform, TrendMiner. This alliance will bring sensor-generated data into analytics for companies looking to opt for these type of technology solutions.

LIST OF KEY COMPANIES PROFILED:

• ABB Ltd (Zürich, Switzerland)


• Siemens AG (Berlin, Germany)


• Cognex Corporation (Massachusetts, United States)


• Schneider Electric SE (Rueil-Malmaison, France)


• Honeywell International Inc. (North Carolina, United States)


• Emerson Electric Co. (Missouri, United States)


• Rockwell Automation, Inc. (Wisconsin, United States)


• General Electric Company (New York, United States)


• Robert Bosch GmbH (Stuttgart, Germany)


• Cisco Systems Inc. (California, United States)


• Denso Corporation (Aichi, Japan)


• Intel Corporation (California, United States)


• Fanuc Corporation (Yamanashi, Japan)

• L&T Technology Services (LTTS) (Vadodara, India)

KEY INDUSTRY DEVELOPMENTS:

• March 2019 - Telefonaktiebolaget LM Ericsson, a leading telecommunication and technology company headquartered in Sweden, launched Ericsson Industry Connect. It is an efficient cellular connectivity solution that will help manufacturers and automakers accelerate industry 43.0 adoptions by making 4G and 5G technology accessible to new global markets.


• March 2021 – NOKIA Corporation partnered with WEG Industries, a power and automation company headquartered in Brazil, to boost the development of the Nokia Digital Automation Cloud (DAC) platform and launch an industry 4.0 solution.

REPORT COVERAGE

An Infographic Representation of Industry 4.0 Market

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The market research report provides an in-depth Industry 4.0 market analysis and focuses on key aspects such as leading companies, applications, and adoption of advanced technologies among several industry verticals. Besides this, it offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several key factors that have contributed to the growth rate of the advanced market over recent years.

Report Scope and Segmentation