Automation market poised for growth

Jan. 1, 2010
It's no secret that the automation systems market for discrete industries began to slow rapidly with the economic downturn that started in 2007. The manufacturing

It's no secret that the automation systems market for discrete industries began to slow rapidly with the economic downturn that started in 2007. The manufacturing sector, initially insulated in 2008, “began to feel pain and then dropped into survival mode,” according to ARC Advisory Group, Dedham, Mass. Automation growth continued its negative course in 2009, and while the short-term forecast for global automation systems for discrete industries looks bleak, moderate market growth is expected toward the end of the five-year forecast period, according to a new study from ARC.

Manufacturers will face challenges to further raise productivity, lower product costs, reduce plant operating expenses, and improve quality to compete in the global market, according to ARC's analysts. Consequently, capital investments for automation are expected to resume across many industries, as automation is vital in overcoming those challenges. “The onward march of globalization is changing the world's industrial landscape. Manufacturers have recognized that industrial automation is key to survival in the global economy. While investment in industrial automation is slowing down in the current economic environment, this effect is only temporary,” says senior analyst Himanshu Shah, the principal author of ARC's Automation Expenditures for Discrete Industries Worldwide Outlook.

With recession-battered consumers cutting spending, the discrete manufacturing industries, such as aerospace, automotive, consumer durables, and semiconductor contracted. This is especially true in developed countries. While the global economy slowly recovers from the world's worst economic meltdown in recent decades, moving forward will not be “business as usual” for most discrete manufacturing companies, according to ARC.

Economies such as India and China weathered the turmoil better than most and continue to show moderate growth. Consumer spending in emerging economies will expand, leading to the emergence of new demand centers and pockets of manufacturing excellence and innovation; the result will be further flattening of the world and increasing competition. “Discrete manufacturing companies, which previously focused on developed markets in Europe and North America, will have to reconfigure their strategies to cater to consumer demands from emerging markets,” says Shah.

One trend noted in the report is strong demand for Programmable Automation Controllers (PACs), multi-disciplined controllers that provide real-time logic, motion, and process control, in addition to HMI and other functions, on a single platform. PACs offer one programming and engineering tool as well as one programming language and a single tag database for the complete system. The report also identifies other industry trends impacting automation equipment — including machine safeguarding, energy, and networking — and challenges faced by suppliers. Diversified suppliers that focus on the infrastructure and process industries fared better during this downturn than those that focus mostly on the discrete industries. For more information, visit www.arcweb.com/res/auto-discrete.

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