- The global programmable logic controller (PLC) market — including smart relays, compact PLCs, standard modular PLCs, high-end modular PLCs, software, and services — rose 4.2 percent year over year, reaching $8.5 billion in 2017. The market is expected to exceed $9.5 billion by 2021.
- As in the past, the United States was the largest market for PLCs in 2017, accounting for nearly 17 percent of global revenue.
- China’s revenue share in the PLC market rose from 15.5 percent in 2015 to 16.5 percent in 2017, narrowing the gap with the United States.
- The compact PLC category is forecast to lead market growth, with sales revenue growing at a compound annual growth rate (CAGR) of 6.5 percent from 2017 to 2021.
Regional breakdown – recovery in the United States and China
The United States accounted for about 70 percent of all PLC revenue generated in the Americas in 2017. After falling oil prices, sluggish Latin American economies (except Mexico), weak demand in Canada and falling commodity prices negatively affected the PLC market in the Americas in 2015, the market accelerated in the first half of 2017, as increased capital spending on housing and construction — and rising industrial investment in oil, gas and mining —stimulated markets that widely use PLCs. This market acceleration boosted growth of PLC deployment in both discrete and process industries.
Facing a constantly changing market environment, downstream companies are keen to leverage technology innovations that lower production costs and improve efficiencies. The three fastest growing process industry markets for PLCs in the Americas are oil and gas, food and beverage, and pharmaceuticals.
China is the second-largest country market for PLCs globally and the largest country market in Asia Pacific. It accounts for about 60 percent of the region’s total revenue. With its weak global macro-economy in 2015, China’s overcapacity and structure issues were highlighted, which accelerated supply-side reform. Companies sought out ways to survive, by updating machinery and production lines to comply with new safety and environmental protection policies and adopting industrial technologies to improve productivity and profits. China also refocused its national investment on infrastructure, rather than real estate, as it had done in the recent past. This investment shift triggered increased demand for industrial automation components.
The Belt and Road Initiative, released by China in 2013, generated huge investment in energy and infrastructure sectors, including railways, highways, ports and power grids. This initiative has generated additional exports for Chinese machinery manufacturers. As automation products manufactured in China for export are largely made to meet Chinese national standards, all components deployed are of regulated quality. The provision and adherence to recognized standards will lead to growth in exports of industrial automation equipment from China over the next five years.
The Chinese PLC market picked up in 2017 and will sustain stable growth through 2021. Robotics, material handling and semiconductors are forecast to be the three fastest-growing vertical markets for PLCs through 2021.
Compact PLCs lead market growth
High-end modular PLCs are increasingly being adopted to meet demand for higher processing speeds, larger data memory, more integrated functions (like motion control and PID loops) and fewer additional modules. However, compact PLC sales will grow even more strongly across all regional markets, as the performance of these products is continuously improving. These products are then capable of meeting the demands of a broader set of applications.
Top vendors in the global PLC market
Analysis of the leading PLC suppliers shows that the top 10 in 2016 are the same as in 2015. These 10 companies continue to gain market share from the rest of the market.
The top 10 PLC vendors in 2015 accounted for around 80 percent of global sales revenue; in 2016 this share increased to 81 percent. However, growth within the these companies is mainly driven by Japanese suppliers — largely due to the appreciation of the Japanese yen in 2016 and large-scale investment in the LCD industry.
About the PLCs Report - 2017The 2017 PLCs Report from IHS Markit examines the worldwide market for PLCs. It provides executives with an up-to-date, comprehensive description of the global PLC market. The report also identifies the trends that will affect the market over the next five years.