Market Insight

Industrial automation equipment market growth rate slows in 2019

January 27, 2020

Lisa Wang Lisa Wang Data Transformation, Manufacturing Technology

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The global market for industrial automation equipment (IAE) is expected to improve modestly in the next few years, despite a slowdown in growth in 2019.

Global IAE revenue last year growth reached $214.7 billion, up a small 1.2% from $212.3 billion in 2018. While last year’s uptick was a marked improvement from the market’s contraction in both 2015 and 2016, the 2019 figure was disappointing compared to the solid growth of 4.3% and 4.7% seen in 2017 and 2018, respectively. The slower expansion rate of 2019 could be attributed to a decelerating world economy, which affected the IAE market in turn.

Although underperforming in 2019, the market is safe from what had been a bruising decline for two straight years in the middle of the last decade. For this year and until 2022, steady—though unspectacular—growth can be expected, according to research from IHS Markit | Technology, now a part of Informa Tech.  

These are some of the findings contained in Industrial Automation Equipment Market Tracker – Q4 (2019), the latest edition of a quarterly report on the worldwide market for industrial equipment, including comprehensive data and analysis on 52 product types and 28 industry sectors.

Regional market share

Among regions, the market known as EMEA—the agglomeration comprising Europe, the Middle East, and Africa—had the largest share of total industry revenue, at approximately 34%. In second place was the Americas, with 25% share of market; followed by China, considered a region of its own in third place; the rest of Asia in fourth; and Japan, also considered its own region, in fifth place.

Automation equipment was the largest IAE category last year, accounting for approximately 38% of the total market. Under this category are discrete controllers and visualization equipment such as industrial PCs; as well as process control equipment like process instrumentation devices.

The second-largest category was power transmission, with 32% share of the IAE market. Under this category are rotary products such as geared motors; as well as linear products like hydraulic valves.  

The third-largest category was motors and motor control equipment, with 30% market share. Under this category are motors and generators such as servo motors; as well as motor controls like medium-voltage drives.

Market leaders

The top five players in the global IAE market are Siemens, ABB, Schneider Electric, Emerson, and Rockwell Automation. However, the market as a whole is fragmented, with the top five holding a collective share of just 23%, with no single player in the entire market possessing a market share in the double digits of 10% or more.

German-based Siemens is No. 1, specializing in programmable logic controllers (PLCs), computer numerical controllers, brushed DC drives, I/O modules, and medium-voltage drives. To strengthen its industrial edge portfolio, it plans to acquire edge technologies from US company Pixeom.

At No. 2 is Swiss maker ABB, whose focus is electrification, industrial automation, motion and robotics, and discrete automation. In October, it acquired a majority stake of 67% in Shanghai Chargedot New Energy Technology Co., a leading Chinese e-mobility solution provider building a new robotics manufacturing and research facility in China.

In third place is French-headquartered Schneider Electric, with important interests in process safety equipment, industrial pushbuttons, and electronic control relays, among other fields.  

US maker Emerson ranks fourth. A new release of the company’s simulation software makes it easier for plants to develop more accurate digital twins.

Rounding out the elite circle and in fifth place is another US firm, Rockwell Automation, which has a major presence in discrete safety equipment, position control hardware, operator terminals, and process safety equipment. In October, Rockwell Automation acquired MESTECH Services, a global provider of manufacturing execution systems (MES) and other solutions, expanding the scale of its consulting and systems integration business in the fast-growing industrial transformation market.

M&A activity

In February, WEG–CESTARI, a subsidiary of Brazil-based WEG S.A., acquired all the capital stock of Geremia Redutores, a Brazilian manufacturer of gearboxes, geared motors, speed and flexible couplings, and gearbox components. Later in the year, WEG acquired the PPI-Multitask group, which specializes in industrial automation systems integration, MES solutions, the Industrial Internet of Things (IIoT), and software for the industry.

In April, US power management company Eaton acquired over 82% controlling interest in Olusoy Eletrik, a leading manufacturer of switchgears based in Ankara, Turkey. In July, Eaton went on to acquire Innovative Switchgear Solutions, a specialty manufacturer of medium-voltage electrical equipment serving the North American utility, commercial, and industrial markets.

The Industrial Automation Equipment (IAE) Market Tracker – Q4 2019 from IHS Markit | Technology is offered in the Manufacturing Technology research service, under the Capital Equipment and Machinery research category. IHS Markit | Technology is now part of Informa Tech. Contact us for more details on the report or if you wish to become a subscriber.

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Manufacturing Technology
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