Factory Automation Market Research Report and Outlook by 2028

The factory automation sector is projected to reach a market size of US$ 249.29 billion by 2028, with an anticipated compound annual growth rate (CAGR) of 8.2% from 2022 to 2028.

Growth in the factory automation sector is particularly notable in regions such as the Middle East & Africa and South & Central America, driven by the expansion of the automotive and manufacturing sectors. Furthermore, governmental initiatives aimed at automating production facilities are significantly contributing to this market's expansion.

Key factors propelling the adoption of factory automation solutions in these regions include supportive government policies and initiatives that encourage the digitization of manufacturing operations. For example, China's "Made in China 2025" initiative outlines a five-year plan to digitize 70% of the country's large enterprises. Additionally, many nations are increasingly deploying industrial robots to enhance manufacturing efficiency. The International Federation of Robotics (IFR) reported that China installed 154,000 industrial robots in 2020, while South Korea saw a 2% increase in robot installations in 2021, totaling 31,083 units.

In Europe, the factory automation market is experiencing consistent annual growth. This trend is largely attributed to the presence of numerous key players in the region, such as ABB Ltd, Siemens AG, and Bosch Rexroth AG. The rising integration of industrial robots across various sectors, including automotive, chemicals, food & beverages, mechanical engineering, and electronics, is further driving market growth. Additionally, government initiatives aimed at promoting digitization within the manufacturing sector are also playing a crucial role in the expansion of the factory automation market.

Numerous companies are pursuing strategic initiatives that are expected to shape the market landscape in the coming years. For instance:

• In 2022, Scania, a leading global transport solutions provider, partnered with ABB to provide a wide array of robotic solutions for Scania's new highly automated battery assembly facility in Sweden.
• In 2021, Rockwell Automation introduced enhancements to its Allen-Bradley PowerFlex 755TL, TR, and TM AC drives, which included new standard corrosive gas protection, essential for industries such as pulp & paper, automotive, tire & rubber, metals, and water/wastewater.

Effects of the COVID-19 Pandemic on the Growth of the Factory Automation Market in North America

The North American factory automation market is witnessing growth due to increased investments from the manufacturing, automotive, and food & beverage sectors aimed at automating production processes. Additionally, government initiatives promoting automation in manufacturing facilities are further driving the demand for automation solutions in this region. North America is home to several major market players, including Honeywell, Schneider, and Emerson Electric Co., which provide advanced automation solutions, thereby fostering market growth.

In 2021, the United States held the largest share of the factory automation market, while Mexico is projected to experience the highest CAGR during the forecast period. The region has been an early adopter of advanced technologies across various industries since 2010, driven by the increasing advantages of automation in factories and growing awareness among small and medium-sized enterprises. The implementation of automation has enabled factories to lower operational costs and reduce production and assembly times, leading to an annual increase in production value. Furthermore, government initiatives aimed at promoting the adoption of advanced technologies and Industry 4.0 solutions are propelling the North American factory automation market. Incentive programs such as quality jobs tax credits, R&D tax credits, and Qualified Facility for Refundable Tax Credits are encouraging the adoption of robotics and supporting the geographical expansion of manufacturing facilities, including R&D and blockchain integration, throughout North America. These investments are motivating major industries in the U.S. to embrace automation, contributing to the growth of the factory automation market.

In 2021, the U.S. maintained the largest market share in North America's factory automation sector, attributed to various industries investing in the automation of their manufacturing processes. Key sectors, including manufacturing, automotive, and food & beverages, have been investing in automating their production facilities for several years. For instance, PepsiCo announced plans in July 2022 to build an automated production facility in Denver, covering 152 acres and expected to be operational by September 2023. Similarly, Nestle has implemented numerous automated solutions for the manufacturing, packaging, and assembly of its products over the years. Such investments are anticipated to drive demand for factory automation solutions across the nation. Additionally, various government initiatives, such as the Quality Jobs Tax Credit and Qualified Facility for Refundable Tax Credits, aim to promote automation adoption in production facilities, which is expected to create growth opportunities for players in the U.S. factory automation market.

Prominent players in the factory automation market include ABB Ltd., Emerson Electric Co., FANUC, General Electric Company, Honeywell International Inc., Mitsubishi Electric Corporation, Omron Corporation, Robert Bosch GmbH, Rockwell Automation, Inc., and Siemens AG.

To assess the factory automation market, both primary and secondary research methods were employed. Secondary research involved collecting qualitative and quantitative data from various internal and external sources, providing an overview and forecast of market growth across all segments. Additionally, several primary interviews were conducted with industry experts, including VPs, business development managers, market intelligence managers, national sales managers, and external consultants, such as valuation experts, research analysts, and key opinion leaders specializing in the factory automation market. These primary interviews were essential for validating data and gathering further analytical insights on the subject.