According to the study published by Astute Analytica, the global machine tools market generated a revenue from US$ 72,109.8 Mn to US$ 95,169.1 Mn by 2027. The market is growing at a compound annual growth rate (CAGR) of 4.7% during the forecast period 2022 to 2027. The increasing number of smart factories in the industrial sector, as well as increased spending by manufacturers on new technology to maintain product quality and exact measurements, are expected to encourage the adoption of autonomous tools. As per the secondary sources, 43% of the world's smart factories are operational, with 33% having formed a smart factory strategy. The remaining 8% will embrace smart factories in the next 3-5 years.
Machine tools are commonly used for cutting, drilling, grinding, shearing, and other forms of deformation when treating or machining metal or other stiff materials. They also have a number of benefits, the most prominent of which being the ability to generate vast amounts of product with little effort. The machine tools market is predicted to develop in the next years as a result of the growing benefits of machine tools and the growing favourable government policies for the manufacturing sector's growth.
Smart manufacturing technologies include big data capabilities, the Internet of Things, artificial intelligence, machine learning, and more, in addition to automation. Industrial automation is helpful in enhancing efficiency and productivity in a variety of industries throughout the world. Because machine tools regulate various areas of the production process and other industrial requirements in real time, industry growth is proportional to the growth of the machine tool market.
Growth is expected to be fuelled by the industrial sector's strong emphasis on enhancing efficiency and reducing downtime. China, India, Argentina, Poland, Brazil, and other developing countries have become manufacturing hubs. APAC region with highest share of population across the globe have a strong manufacturing sector, that increases the demand of machine tools in manufacturing industries of the countries in APAC. Smart technology is becoming more common in manufacturing operations, as it helps businesses to improve productivity, maximise resources, and develop new products.
Machine tool usage is projected to rise as the demand for mass production rises in industries such as aerospace and military, and other industry verticals. Metal cutting tool demand is rising in unison with the increased usage of metals in a variety of industries, indicating a positive growth slope for the industry.
Furthermore, favourable government regulations and policies support the manufacturing business, which is driving increased demand for machine tools. For example, China's government introduced "Made in China 2025" and "Industry 4.0" at the same time in 2016.
However, small and medium-sized firms (SMEs) are unable to incorporate machine tools into their operations due to the high cost of installing CNC machines. According to Prototech Asia, the devices, which include CNC milling machines, cost about US$ 35-40 per hour to run. As a result, concerns about machine tool installation and the high cost of machine adoption among SMEs are constraining market growth.
For businesses all across the world, the covid-19 pandemic has created an unprecedented crisis. The spread of coronavirus has resulted in country-wide lockdowns, forcing people to stay at home and businesses to allow staff to work from home in order to stem the spread of the pandemic. Due to lockdown and social distancing measures, factories and production facilities have been forced to remain closed, resulting in a dramatic decline in global machine tool sales.
As a result of the lockdown or curtailed output, the disruption in the supply chain of materials has negatively impacted the supply of machine tools.
Machine tool makers rely on their supply chain, relying too heavily on key component suppliers, and their poor negotiating strength will lead to casting, high-precision components, and other issues. The market, on the other hand, will gain traction as new technologies, such as chip producing equipment, are invested in, fostering the expansion of the machine tools industry.
The market comprises of different product types including milling machine, drilling machine, lathe machine, machine centres and few others. However, milling machines under product segment is projected to grow at the highest CAGR of 7.4% in the forecast period while machine centres hold maximum share of more than 20% in 2020. Due to the growing requirement to minimise operating costs, personnel, and errors in components manufactured in industries such as aerospace & defence, and automotive, among others, the CNC machine tools segment provided the largest share of 65.2% and is also growing at the highest CAGR of 4.1% during the forecast period.
North America, Europe, Asia Pacific, the Middle East and Africa (MEA), and South America are among the regions that make up the global market. With a revenue share of more than 54.1% in 2020, Asia Pacific was the market leader. This is due to regional governments' efforts to promote local manufacturing, such as "Make in India" and "Made in China 2025," which have increased middle-class customers' per-capita income. The per-capita income of middle-class customers has improved, resulting in higher spending on items. To meet demand and grab chances in the Asian market, manufacturers are investing in new production plants and machines.
Furthermore, end-user industries have shifted their enterprises to Asian countries due to low-cost manufacturing competitiveness, such as lower labour costs, young populations, and low raw material costs, leading in a significant increase in machine tool demand. The North America regional market, on the other hand, is likely to grow at the fastest CAGR due to increased demand for machine tools from incumbents in the aerospace and defence, automotive, and oil and energy industries, among other industries and industry verticals.
One of the methods to expand any market is to improve the global trade and expand business in different regions of the world. The US-China trade pact, which might result in a significant increase in Chinese agricultural imports from the US, could spur investment in agricultural equipment. The predicted passage of the USMCA will likely increase commerce across North America and increase investment in capital-intensive industries.
The market has vigorous competition and key players are involved in one or the other strategy to maintain their outstanding performance and stable position in the industry. For instance, Amada AI Innovation Laboratory Inc. was founded in January 2020 by Amada Co. Ltd. to create or market breakthrough automation tools. Another player, CHIRON Group unveiled their new 715 Series machining facility in July 2021. The machine fits between the vertical CHIRON FZ 08 S mill turn precision+ machining centre and the STAMA MT 733 machining centre and is designed for complete machining of all six sides of complex items. It incorporates automated part handling and storage. Some players are initiating new production plants to uphold their places in the global machine tools market. For example, DMG MORI strengthened its Deckel Maho Pfronten facility in southern Germany in February 2021. The plant will feature a 4,000-square-meter monoBLOCK Excellence Factory, allowing DMG MORI to produce up to 1,000 machine tools per year using a forward-thinking assembly methodology.
Other key players doing well in the market are Trumpf, Makino, Okuma Corp., and Komatsu Ltd. among others. The global machine tools market is segmented as:
By Product Type
By Automation Type
By Industry
By Sales Channel
By Geography
Developing economies offer lucrative opportunities for companies to expand their businesses. Several key players contributing to the market are:
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