Smart Manufacturing Market

Smart Manufacturing Market Size and Forecast

The global Smart Manufacturing Market is valued at USD 230.2 Billion in 2024 and is projected to reach a value of USD 1097.26 Billion by 2035 at a CAGR (Compound Annual Growth Rate) of 15.25% between 2025 and 2035.

Smart Manufacturing Market Key Highlights

• Based on the Component, the Software category accounted for significant market share of 48.5% in Smart Manufacturing market industry in 2024
• In 2024, by Technology, Discrete Control Systems dominated the Smart Manufacturing market with significant Smart Manufacturing market share of 15.6%
• By Industry, Automotive dominated the Smart Manufacturing market with market share of 25.2% in 2024
• Asia Pacific dominated the Smart Manufacturing market industry with 35.6% Smart Manufacturing market share in 2024
• Asia Pacific region is anticipated to grow at the highest CAGR during the forecast period in Smart Manufacturing market industry

Based on the provided market data, Vantage Market Research offers customizations in the reports to meet the specific needs of clients.

Smart Manufacturing Market Growth Factor

Increasing Adoption of Advanced Technologies to Reduce Downtime and Waste

Unplanned downtime and production losses pose significant challenges for manufacturers in Smart Manufacturing market, often leading to operational inefficiencies. It is essential to identify potential defects and failures before they occur to avoid such risks. Plant Asset Management (PAM), industrial 3D modeling, and digital twins technologies are transforming manufacturing by improving predictive maintenance and maximizing output. PAM systems detect possible errors in real time at both the component and process levels, allowing for rapid corrective actions. This predictive technique improves operational efficiency while also extending equipment life. Similarly, digital twin technology generates virtual reproductions of actual assets, enabling engineers to fine-tune designs and enhance manufacturing processes prior to practical deployment. Due to these technologies, industries may improve performance, reduce downtime and increase production, lowering operational costs.

Smart Manufacturing Market Restraint Factor

High Initial Investment Costs

One of the major challenges hindering the Smart Manufacturing market is the widespread adoption of smart manufacturing technologies requires substantial upfront investment. Advanced technologies like as robots, IoT, AI, and automation require significant investment in both procurement and integration. Small and medium-sized enterprises frequently face finance challenges, making large-scale adoption challenging. Additionally, the return on investment (ROI) for these technologies is spread over several years, making it challenging for manufacturers to justify the financial risk. Many businesses remain hesitant to transition from traditional manufacturing methods to smart solutions due to concerns over long payback periods and uncertain long-term benefits. Until costs decline and ROI becomes more immediate, financial constraints will continue to limit the broader adoption of smart manufacturing solutions.

Smart Manufacturing Market Opportunity Factor

Rapid Advancements in IIoT and Cloud Computing

The integration of Industrial Internet of Things (IIoT) devices is transforming manufacturing by enabling seamless automation and intelligent connectivity across production facilities presents significant opportunity for Smart Manufacturing market. IIoT increases operational efficiency by enabling real-time data gathering, remote monitoring, and predictive analytics, resulting in better decision-making and less downtime. These technologies also enable producers to get insights into previously difficult-to-monitor regions, resulting in improved control and optimization of manufacturing processes.

Component Insights

​The Component segment is divided into Hardware, Software and Services. The Software segment held the dominant share in 2024, accounting for significant Smart Manufacturing market share of 48.5%.

• Software held the most market share in 2024 in Smart Manufacturing market and is expected to maintain its dominance throughout the forecast period. As the sector transitions to complete automation, software becomes the crucial underpinning for operations. It allows robots, drones, and other gear to perform seamlessly without human interaction, reducing the possibility of errors.The integration of advanced software will drive significant progress in research and development, leading to the creation of more versatile solutions for the Smart Manufacturing market
• The hardware segment is anticipated to experience the highest compound annual growth rate (CAGR) of 13.2% from 2025 to 2035 in Smart Manufacturing market. Advanced software necessitates compatible, high-performance hardware to operate effectively. For these sophisticated software solutions to function, they require modern hardware that is power-efficient, agile, and capable of operating autonomously. Additionally, this hardware must be compatible with the Internet of Things (IoT) to ensure seamless integration and standardization across manufacturing operations

Technology Insights

The Technology segment is divided into Machine Execution Systems, Programmable Logic Controller, Enterprise Resource Planning, SCADA, Discrete Control Systems, Human Machine Interface, Machine Vision, 3D Printing, Product Lifecycle Management, Plant Asset Management. In 2024, the Discrete Control Systems segment held largest share of 15.6% in the Smart Manufacturing market.

• In 2024, the Discrete Control Systems segment held the largest share of the Smart Manufacturing market revenue. Discrete control system technology operates in the background, providing control and monitoring functions for administrators. It offers both basic and advanced levels of control, enabling oversight of every process. This integration of technology and industrial automation allows for remote accessibility and management of operations
• The 3D printing segment is projected to grow at the highest compound annual growth rate (CAGR) of 16.9% during the forecast period in Smart Manufacturing market. 3D printing enables smart manufacturers to produce parts of any size by designing them using 3D software. This technology saves both time and costs by allowing quick, on-the-spot design and printing. The Smart Manufacturing market is a significant consumer and investor in 3D printing equipment and software, further driving its expansion in Smart Manufacturing market

Industry Insights

The Industry segment is divided into Oil & gas, Food & beverages, Pharmaceuticals, Chemicals, Energy & power, Metals & mining, Pulp & paper, Automotive, Aerospace, Semiconductor & electronics, Medical devices, Heavy machinery, Other industries. In 2024, the Automotive segment held largest share of 25.2% in the Smart Manufacturing market.

• In 2024, the Automotive segment held largest share in the Smart Manufacturing market and is expected to experience the highest CAGR of 14.8% during the forecast period. Many automotive manufacturers are operating with minimal profits, prompting them to adopt smart manufacturing to cut waste, reduce costs, and improve their profit margins. This market also supports automotive companies in maintaining high product standardization. Industry 4.0, in particular, enables automotive manufacturers to operate continuously and reduce labor costs where applicable
• The aerospace and defense industry is projected to register a substantial CAGR of 16.1% from 2025 to 2035 for Smart Manufacturing market. This sector is making significant investments in smart manufacturing, as precision is crucial for product development. For space research, the ability to produce rockets at a rapid pace is essential for conducting multiple test flights. Similarly, the defense sector is heavily investing in industrial automation to develop advanced defense systems capable of countering emerging threats

Regional Trends

In 2024, the Asia Pacific captured 43.5% of the revenue share inSmart Manufacturing market.

Asia Pacific Smart Manufacturing Market Trends

Asia Pacific Smart Manufacturing market is driven by Countries like India and China, with their vast untapped potential, are driving toward full automation in smart manufacturing. These nations are also focusing on becoming self-reliant in production and manufacturing, prompting substantial investments in Industry 4.0 technologies. The Asia Pacific region has seen a significant boost in its manufacturing sector due to rapid industrialization, establishing it as a global manufacturing hub. With its low labor costs and an abundant, skilled workforce, the region offers strong advantages for industrial operations. Furthermore, Asia Pacific is at the forefront of industrial robot adoption, accelerating automation across various industries. Together, these factors are fueling the swift expansion of Smart Manufacturing market in the region.

China Smart Manufacturing Market Trends

The China Smart Manufacturing market plays a significant role in driving global Smart Manufacturing market demand, with the largest manufacturing sector in the world. Despite challenges like production and supply chain disruptions caused by COVID-19 restrictions, the country’s industrial output rose by 3.6% in 2022, as reported by the Ministry of Industry and Information Technology (MIIT). The MIIT forecasted a 3.1% growth in manufacturing output for 2022, contributing to 28% of China’s GDP. Once known for its labor-intensive manufacturing, China has transformed into a high-end manufacturing powerhouse through digitalization and industrialization. According to GSMA, China is expected to account for a third of the global IIoT market by 2025.

India Smart Manufacturing Market Trends

India’s manufacturing sector has also emerged as one of the fastest-growing, with the "Make in India" initiative helping position the country as a major manufacturing hub on the global stage. Government programs such as Digital India and Make in India are playing a crucial role in the region's industrialization, with IoT providing innovative solutions for sustainable growth in the manufacturing sector inSmart Manufacturing market. India’s pharmaceutical industry, in particular, is leading in automation, with major companies like Zydus Cedilla, Torrent Pharma, and Cipla automating their drug manufacturing processes, particularly in areas requiring full machine integration.

India’s government has set a target of achieving a USD 5 trillion economy by 2025, with the manufacturing sector projected to contribute USD 1 trillion. Flagship programs such as Make in India, Skill India, and Digital India are seen as crucial to achieving this goal and driving market expansion. Several leading companies are also investing in smart manufacturing technologies to enhance productivity and maintain a competitive edge. For instance, Samsung Electronics announced in March 2023 that it would invest in smart manufacturing capabilities at its second-largest mobile phone plant in Noida to improve production efficiency.

North America Smart Manufacturing Market Trends

North America region is experiencing the fastest growth in Smart Manufacturing market. The Smart Manufacturing market expansion is primarily fueled by increased spending on advanced manufacturing technologies in both Canada and the U.S. Technological advancements, the availability of alternative printing materials, and lower equipment costs have all contributed to the widespread adoption of Smart Manufacturing. The region is seeing a surge in investment initiatives across sectors such as healthcare, aerospace and defense, manufacturing, and automotive, all of which are expected to see substantial growth in the future. Key government organizations, including NASA, have recognized the significant potential of 3D printing R&D investments, particularly for space applications, which could foster new technologies and drive Smart Manufacturing market expansion.

Latin America Smart Manufacturing Market Trends

Latin America Smart Manufacturing is expected to witness significant growth, with a projected CAGR of 14.8% during the forecast period. The region’s Smart Manufacturing market for innovation and automation is rapidly expanding, with smart manufacturing becoming increasingly normalized. As Latin America is in the early stages of its technological revolution, opportunities for smart manufacturing are growing. Additionally, the region's proximity to abundant raw materials further supports smart manufacturing growth and boosts Smart Manufacturing market development.

Europe Smart Manufacturing Market Trends

Europe is forecasted to experience steady growth in Smart Manufacturing market during the forecast period, fueled by the growing adoption of the Internet of Things (IoT) in countries like Italy, Germany, and Spain. The rising labor costs in Western countries are motivating manufacturers to embrace automation and implement smart manufacturing solutions. These innovations are leading to higher productivity and improved operational efficiency, further supporting Smart Manufacturing market growth.

Smart Manufacturing Market Trends

• Growing Adoption of Industrial IoT (IIoT) and Connectivity: Manufacturers are increasingly deploying Industrial IoT (IIoT) solutions to enable real-time monitoring, predictive maintenance, and data-driven decision-making. The integration of 5G and edge computing is further accelerating IIoT adoption, improving connectivity, reducing latency, and enhancing data processing at the source, leading to more responsive and efficient manufacturing operations
• Expansion of AI and Machine Learning in Manufacturing: Artificial intelligence (AI) and machine learning (ML) are revolutionizing manufacturing by optimizing production efficiency, detecting defects, and improving supply chain management. AI-powered predictive maintenance reduces downtime by identifying potential failures before they occur, while intelligent automation streamlines workflows and enhances decision-making capabilities
• Rise of Digital Twin Technology: Digital twin technology is gaining traction as manufacturers use virtual replicas of physical assets and production lines to simulate and optimize processes. By integrating digital twins with AI and cloud computing, companies can analyze real-time data, test new designs, and improve asset performance, ultimately reducing costs and enhancing productivity
• Advancements in Robotics and Automation: The adoption of robotics and automation is accelerating, with collaborative robots (cobots) playing a crucial role in enhancing human-machine collaboration. Autonomous mobile robots (AMRs) and automated guided vehicles (AGVs) are transforming logistics and material handling, improving efficiency and reducing manual labor. Manufacturers are also integrating AI-powered robots to handle complex and repetitive tasks with greater precision
• Shift Toward Cloud-Based Smart Manufacturing Solutions: Cloud-based manufacturing execution systems (MES) and enterprise resource planning (ERP) solutions are enabling manufacturers to scale their operations and monitor production remotely. Hybrid cloud models are becoming popular as they provide the benefits of both on-premises security and cloud flexibility, helping manufacturers achieve a balance between control and scalability.
• Integration of Augmented Reality (AR) and Virtual Reality (VR): AR and VR technologies are being used for training, remote assistance, and real-time visualization of complex manufacturing processes. AR applications enhance quality control and maintenance workflows by overlaying digital information on physical objects, allowing workers to perform tasks more accurately and efficiently

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Competitive Landscape

The competitive landscape of the Smart Manufacturing market is characterized by the presence of global technology leaders, industrial automation companies, and emerging startups driving innovation. Key players such as Siemens, ABB, Mitsubishi Electric, Rockwell Automation, Schneider Electric, Honeywell, and General Electric compete through advanced automation solutions, AI-driven analytics, and industrial IoT platforms. Strategic partnerships, mergers, and acquisitions play a crucial role in strengthening market positions, as seen in recent collaborations like ABB's integration of simulation tools for automotive paint shops and Siemens' acquisition of Altair Engineering to enhance AI-powered design capabilities. Companies are also investing in cloud-based manufacturing execution systems (MES), digital twins, and predictive maintenance technologies to optimize production efficiency and sustainability. Additionally, growing investments in robotics, cybersecurity, and AI-powered supply chain management further intensify market competition. With increasing adoption across industries such as automotive, aerospace, pharmaceuticals, and electronics, manufacturers are focused on expanding their smart factory initiatives to enhance productivity and operational resilience.

The key players in the global Smart Manufacturing market include - ABB Ltd., Siemens, General Electric, Rockwell Automation Inc., Schneider Electric, Honeywell International Inc., Emerson Electric Co., Fanuc UK Limited among others.

Recent Market Developments

• In December 2024, ABB (Switzerland) partnered with Engineering Software Steyr GmbH (Austria) to advance automation in automotive paint shops. Through this collaboration, ABB’s RobotStudio platform will integrate Engineering Software Steyr GmbH’s cutting-edge paint shop simulation tools, optimizing processes and promoting sustainability for car manufacturers
• In October 2024, Siemens (Germany) reached an agreement to acquire Altair Engineering Inc. (US), a key player in industrial simulation and analysis software. This acquisition reinforces Siemens' dominance in industrial software by enhancing its AI-driven design and simulation capabilities, further accelerating digitalization and sustainability efforts
• In October 2024, Mitsubishi Electric Corporation (Japan) made a strategic investment in Formic Technologies, Inc. (US), a startup providing subscription-based industrial robotics solutions. This investment aims to lower the cost of automation and expand accessibility, addressing labor shortages in the manufacturing sector
• In September 2024, SAP (Germany) acquired WalkMe Ltd. (US) to integrate its AI-powered WalkMeX technology into SAP’s Joule copilot. This integration enhances workflow automation with intelligent, context-aware assistance, strengthening SAP’s ability to improve user experience, drive software adoption, and support business transformation
• In August 2024, Cisco Systems, Inc. (US) acquired Robust Intelligence, Inc. (US) to reinforce its commitment to responsible AI. By incorporating advanced AI security and governance into its Security Cloud, Cisco enhances protection against emerging AI threats, fosters innovation, and simplifies AI deployment and security for organizations

Smart Manufacturing Market Segments Covered in the report:

Component

• Hardware
  • Industrial Sensors
    • Contact sensors
    • Non-contact sensors
  • Industrial Robots
    • Traditional robots
    • Collaborative robots
  • Machine Vision Systems
  • 3D Printers
  • Automated Guided Vehicles (AGVs)
    • Tow vehicles
    • Unit load carriers
    • Pallet trucks
    • Assembly line vehicles
    • Forklift trucks
    • Other automated guided vehicles
  • RFID & Barcode Scanners
• Software
• Services
  • Consulting & Implementation Services
  • Managed Services
  • Support & Maintenance

Deployment

• Cloud
• On-Premises

Enterprise Size

• Large Enterprises
• Small & Medium Enterprises

Technology

• Machine Execution Systems
• Programmable Logic Controller
• Enterprise Resource Planning
• SCADA
• Discrete Control Systems
• Human Machine Interface
• Machine Vision
• 3D Printing
• Product Lifecycle Management
• Plant Asset Management

Industry

• Oil & gas
• Food & beverages
• Pharmaceuticals
• Chemicals
• Energy & power
• Metals & mining
• Pulp & paper
• Automotive
• Aerospace
• Semiconductor & electronics
• Medical devices
• Heavy machinery
• Other industries

Smart Manufacturing Market Regions and Countries:

North America

• U.S.
• Canada
• Mexico

Europe

• Germany
• France
• U.K.
• Italy
• Spain
• Nordic Countries
• Benelux Union
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• New Zealand
• Australia
• South Korea
• South-East Asia
• Rest of Asia Pacific

Latin America

• Brazil
• Argentina
• Rest of Latin America

The Middle-East and Africa

• Saudi Arabia
• UAE
• Egypt
• Kuwait
• South Africa
• Rest of Middle-East Africa