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Manufacturing Industry

As we step into 2024, the manufacturing industry stands at a crossroads, navigating through post-pandemic challenges, labor shortages, regulatory shifts, trade disputes, and supply chain complexities. In the pursuit of overcoming these obstacles, industrial and manufacturing enterprises are actively embracing digital transformation. Techview Research, a leading market research firm in the Asia Pacific, delves into the latest technology trends shaping the destiny of manufacturers’ digitalization journey.

The Global Manufacturing Landscape

In its recent market forecast, Techview Research unveils that the worldwide Manufacturing Value Added (MVA) in 2022 surpassed US$16 trillion, showcasing a growth rate slightly below the 20% witnessed between 2020 and 2021. The “Big 4” manufacturing nations, namely China, the United States, Japan, and Germany, collectively contribute to 57% of the global MVA. The Asia-Pacific region, spearheaded by China, dominates the global manufacturing market, accounting for 45% and growing at a remarkable CAGR of 4.5%.

Energy, mining, and automotive sectors emerge as dominant forces, with the top 10 manufacturers by revenue in 2023 being led by mining and crude oil giant, Saudi Aramco, generating staggering annual sales of US$603.7 billion and profits exceeding US$159 billion.

Trend 1: An Increasingly Complex Operating Environment

Geopolitical Dynamics and Reshoring Challenges

  • The rise of “friend shoring” as a response to geopolitical tensions.
  • Complexities in reshoring production, particularly in chip manufacturing.
  • Balancing the desire for stable production with the lack of local expertise in Western nations.

Strategic Investments and ESG Considerations

  • Manufacturers investing in key material and component producers for supply chain resilience.
  • Growing emphasis on Environmental, Social, and Governance (ESG) criteria in manufacturing.
  • The need for a digital thread to assess ESG criteria from design to end-of-life.

Trend 2: Many Manufacturers Are Not Ready for Generative AI

Challenges in Digital Transformation

  • Increased borrowing costs and rising raw material expenses impacting digital transformation.
  • Generative AI emerges as a transformative technology requiring internal cultural shifts.
  • Lack of patience and financial readiness hindering widespread adoption of generative AI in 2024.

Gradual Transition to Automation

  • The misconception of mundane tasks disappearing with AI implementation.
  • The gradual nature of the transition to AI-based automation.
  • Establishing a business case for generative AI adoption in manufacturing.

Trend 3: Increased Adoption of SaaS-Based CAD Solutions

Shift Towards Cloud-Based Solutions

  • SaaS-based Computer-Aided Design (CAD) solutions gaining prominence.
  • Benefits of cloud-enabled features, including collaborative work and generative design enhancements.
  • Emerging SaaS-based CAD software solutions like CREO+ and Zel X in a market led by established offerings.

Growth Projections for SaaS Deployments

  • Forecasted revenue growth for SaaS deployments of CAD outpacing on-premises solutions.
  • The role of cloud-enabled features in supporting collaborative design and VR integration.
  • Market dynamics and competition among established and emerging SaaS-based CAD solutions.

Trend 4: Industrial Metaverse Deployments to Ramp Up, but Remain Small-Scale

The Rise of the Industrial Metaverse

  • Siemens’ demonstration of the industrial metaverse’s potential at Hannover Messe 2023.
  • Large-scale metaverse deployments facing upfront cost challenges.
  • Small-scale metaverse projects focusing on areas like employee training and collaboration.

Use Cases and Business Case Establishment

  • Low-hanging fruit use cases for industrial metaverse projects in 2024.
  • Areas of application, including employee training, collaboration, production planning, and remote expert assistance.
  • The potential for scaling metaverse deployments once a business case is established.

Trend 5: AI-Based QMS Software Still in Its Early Days

Significance of Quality Management System (QMS) Software

  • Quality assurance as a critical aspect of manufacturing.
  • Integration of AI into QMS software for enhanced defect detection.
  • The nascent opportunity for AI-based QMS software in 2024.

Challenges and Educational Phase

  • Manufacturer reluctance to fully automate key decision-making processes through AI.
  • QMS software vendors in the educational phase, understanding plant floor challenges.
  • Anticipated announcements of AI functionality in QMS solutions at industry events.

Conclusion

In conclusion, the manufacturing industry in 2024 is characterized by a landscape defined by complexity, technological aspirations, and strategic shifts. Techview Research insights into these five impactful trends provide a roadmap for manufacturers aiming to navigate the evolving digital terrain. As industry leaders grapple with reshoring complexities, AI adoption challenges, CAD solution transformations, metaverse opportunities, and nascent AI-based QMS implementations, the year ahead promises both challenges and transformative potential. Techview Research, with its market intelligence prowess, continues to guide the manufacturing sector towards a future marked by innovation and resilience.

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