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Industry 4.0 Market Outlook (2023 to 2033)

The global industry 4.0 market is projected to reach a value of US$ 89.2 Billion in 2023 and is anticipated to reach US$ 484.5 billion by 2033, growing at a CAGR of 18.4%. With Industry 4.0, companies are revolutionizing production, innovation, and distribution processes. New technologies are being incorporated into manufacturers' production facilities and throughout their operations, including cloud computing, the Internet of Things (IoT), analytics, and artificial intelligence (AI). A wide variety of industries can benefit from Industry 4.0 concepts and technologies, including manufacturing companies, oil and gas companies, mining companies, and many others.

In Industry 4.0, manufacturers have an opportunity to reinvent themselves in an information-intensive, connected environment that includes big data, people, processes, services, systems, and IoT-enabled assets. In order to make smart industries and ecosystems of industry collaborations and innovation possible, it is essential to leverage data and information that can be generated, analyzed, leveraged, and used.

Cyber-physical systems are part of Industry 4.0, which represents a fourth industrial

revolution toward an industrial IoT-enabled, end-to-end value chain. A high-tech strategy was presented by the German government at Hannover Messe in 2006. A new government strategy for high-tech innovation in Germany, 'Die Neue Hightech-Strategie Innovationen für Deutschland', described how it intended to drive innovation, including technical and social innovations that revolved around society.

Government officials stated their intention to support businesses and scientists in developing and implementing Industry 4.0, with an emphasis on threats to security and the effects on employment and labor. The government has also identified other priority areas for developing digital infrastructure, including burgeoning data centers, smart services, cloud computing, digital and intelligent networks, and digital education.

Dr. Kagermann and Dr. Wolfgang Wahlster of the German Research Center for Artificial Intelligence (DFKI) presented their findings five years later, in 2011. Wolf-Dieter Lukas, from the Federal Ministry of Research and Education, introduced the concept of Industry 4.0, which became widely known from then on.

Cyber-physical systems are used to develop new business models as part of the future project Industrie 4.0. In 2013, Bitkom (Germany's digital association), VDMA (German Mechanical Engineering Industry Association), and ZVEI (Germany's Electrical Industry Association) came together as part of the Platter Industrie 4.0 project to further develop the project. Other organizations were also invited to join in later on.

An agreement was announced early in 2016 between the Industrial Internet Consortium and Plattform Industrie 4.0 to collaborate on standards, architectures, and business goals related to the new manufacturing sector. Smart factories are one of the most game-changing verticals in the smart technologies space since they reduce human error, enhance the quality of production, and increase efficiency. Real-time monitoring of manufacturing operations and work conditions will be enabled by smart IoT sensors and devices. In an environment where companies invest heavily in maximizing operational efficiency and productivity, it is likely that the smart factory industry will grow.

A collision is brewing between the parallel narratives associated with cellular 5G and Industry 4.0. According to China, by 2023 it will bring online 30 new smart factories, relying on 5G. In a new Industry 4.0 action plan released by the Ministry of Industry and Information Technology (MIIT), China plans to construct 30, 5G factories by 2023, three to five international platforms for industrial internet use, and a big data center aimed at supporting the industrial internet. A brand-new generation of homegrown IoT platforms will emerge within the next few years.

Data Points Key Statistics
Estimated Base Year Value (2022) US$ 76.4 billion
Expected Market Value (2023) US$ 89.2 billion
Anticipated Forecast Value (2033) US$ 484.5 billion
Projected Growth Rate (2023 to 2033) 18.4% CAGR

Industry 4.0, often known as the "fourth revolution of industrialization," simply refers to the application of the numerous technologies that can help improve the performance of factories and industries. These technologies have also witnessed an increase in their applications over the past few years; these technologies primarily include artificial intelligence, machine learning, the Internet of Things, cloud computing, data analytics, automation, and robotics.

The application of these technologies is believed to vastly improve the production, delivery, and manufacturing of industrial products and the various processes involved.

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2018 to 2022 Industry 4.0 Market Demand Outlook Compared to 2023 to 2033 Forecast

The industry 4.0 market is estimated to grow at a CAGR of 10.6% for the forecast period, compared to a historic CAGR of 6.8% for the period 2018 to 2022.

Cloud computing and its applications, artificial intelligence, and automation have witnessed impressive technological developments over the historic period; hence, it will not be wrong to assume that the developments that will take place over the forecast period can have vast impacts upon various industries and 4.0.

Greater applications of these technologies that allow industries to save time, reduce costs, and improve efficiency will be attractive to the end users, allowing the market for Industry 4.0 to grow further over the forecast period.

Government pressure upon industries to meet the net-zero emission targets can further push industries to implement smart factory and industry 4.0 solutions and technologies.

Improvement in the Processes and Outputs Delivered by Industries is the Primary Driver for the Industry 4.0 Market While Also Saving Cost and Money

As of today, several large enterprises that have their own production and manufacturing units make use of technology that allows them to improve their outputs. The use of automated image recognition allows manufacturers to carry out quality control and inspection efficiently and faster.

The use of artificial intelligence and data analytics allows industries to make highly accurate forecasts and allows the management to take economical business decisions, while the use of robotic workers allows companies to increase their production and delivery while also reducing human error.

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Loss of Employment for Front Workers and Demand for Highly Skilled Employees Could Result in the Creation of Challenges for Industry 4.0

Robotic automation, driverless vehicles, and transportation are among the technologies being used in Industry 4.0, and other technologies such as artificial intelligence can reduce the number of human workers required for any given task. While this may increase the demand for employees who are skilled in operating these technologies, the skill levels required may make it difficult to find the right skilled employees.

But the reduced demand for the number of frontline workers needed in factories, plants, and industries could create a loss of employment for many workers. This can create a situation where there is opposition against some technologies, and certain companies could be discouraged from implementing Industry 4.0 solutions and even face some backlash.

Regional Analysis

North America was estimated to have held the largest market share for industry 4.0 of 26.5%, and although not the fastest region, it will still progress at a high CAGR of 16.5% over the forecast period. East Asia is estimated to grow at the highest CAGR of 18.9% over the forecast period.

Factors that allow East Asia to progress at such a high rate include the high population in the region, which causes the industries to have a large group of people they need to cater to, along with a large presence of electronics and automobile manufacturing industries.

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Country wise insights

USA Already Has Numerous Industry 4.0 Technologies in Application, giving it a Head Start Compared to Other Countries

Resources and technological developments allow this country to make progress in the development of technologies such as AI and IoT that will in turn help in the progress of Industry 4.0. The use of driverless cars, manufacturing robots, and 3D printing can already be seen in this country for various industrial purposes.

Having the necessary technological advancements, such as the presence of 5G technology that has been deployed across various countries at the same level, gave the US a head start for industry 4.0.

Due to these reasons, the USA was estimated to have held the largest market share of 15.4% for 2022 in the industry 4.0 market.

The Vision of Connected Industries is Underpinning the Development of Industry 4.0 in Japan

Japan is globally known for its electronic and automobile companies, suggesting that the majority of the implementation of Japan’s Industry 4.0 revenue will be focused in these two areas.

The country has a vision of developing the concept of connected industries, allowing industries, factories, and organisations in this country to collaborate efficiently through the means of technologies such as IoT, cloud, etc. and improve the solutions and products that are provided.

Due to this reason, Japan held a respectable market share of 6.8% and grew at a CAGR of 15.4% over the forecast period.

Implementation of Software Solutions Occurring at a Rapid Rate in India, But Lagging in the Implementation of Industrial Automation

The manufacturing industry in this country is witnessing huge growth, and among these manufacturers there are numerous companies. Being a large and diverse country, the country has numerous manufacturing factories and industries that focus on various different end products.

The country lacks sufficient industrial automation and falls short of the number of robots and cobots that should exist given the size of the infrastructure and the number of end users, but it is rapidly implementing technologies such as cloud computing, big data analytics, and AI.

Due to these reasons, India is estimated to grow at a CAGR of 13.4% over the forecast period.

Category wise Insights

Why Hardware Segment has the Largest Market Share by Solutions for Industry 4.0 Market?

Various technologies like IoT sensors, 5G internet services, industrial robotics, and cloud computing that form a critical part of the infrastructure necessary for Industry 4.0 have numerous hardware components involved that could become more complex, expensive, and grow in number depending upon the size and scale of any given industry.

Due to this reason, the hardware segment of the category “solutions”, held the largest market share of 39.6% in 2022.

Why is 5G the Fastest Growing technology in Industry 4.0?

5G technology is estimated to be the fastest-growing technology for Industry 4.0, growing at a CAGR of 22.7% over the forecast period.

This is the latest development in internet technology and should become the most used technology by the end of the forecast period, replacing 4G technology. Internet connectivity is one of the key factors influencing industry 4.0 and enables the operation of numerous industry 4.0 technologies such as the digital twin, IoT, blockchain technology, AI, and so on.

Competitive Landscape

While there are numerous companies that are developing solutions specifically focused on industry 4.0, the technologies and solutions that it uses are diverse and allow companies without any specific focus on industry 4.0 solutions, to contribute to this market.

  • In June 2022, Siemens and Nvidia are partnered to make it easier for manufacturers to create photorealistic digital twins of their products and manufacturing processes, view and manipulate those twins in real- with the help of industry 4.0.
  • In February 2022, Sentaca, a software consulting firm and cloud platforms specialist of industry software that serves telcos and communications service providers (CSPs), has been acquired by IBM.IBM CEO Arvind Krishna has been beginning to turn the company toward industry 4.0 as a cloud system and associated IT consulting opportunities through acquisitions such as Sentaca.

Scope of report

Attribute Details
Market value in 2022 US$ 76.4 Billion
Market CAGR 2023 to 2033 18.4%
Share of top 5 players Around 30%
Forecast Period 2023 to 2033
Historical Data Available for 2018 to 2022
Market Analysis USD Billion for Value
Key Regions Covered North America, Latin America, Europe, South Asia & Pacific, East Asia and the Middle East & Africa
Key Countries Covered USA, Canada, Germany, United kingdom, France, Italy, Spain, Russia, China, Japan, South Korea, India, Australia & New Zealand, GCC Countries, Turkey, and South Africa
Key Segments Covered Solution, Technology, and Region
Key Companies Profiled
  • IBM
  • Siemens
  • ABB
  • Mitsubishi Electric Corporation
  • General Electric
  • Cisco Systems, Inc.
  • Microsoft
  • Alphabet Inc
Report Coverage Market Forecast, Company Share Analysis, Competition Intelligence, DROT Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives
Customization & Pricing Available upon Request

Industry 4.0 Market by Category

By Solution:

  • Hardware
  • Software
  • Services
    • Professional Services
    • Managed Services

By Technology:

  • Additive Manufacturing
  • Industrial Robotics
  • Blockchain Technology
  • IoT
  • AI
  • Metrology
  • Digital Twin
  • Augmented Reality (AR) and Virtual Reality (VR)
  • 5G
  • Others

By Region:

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Pacific
  • Middle East & Africa

Frequently Asked Questions

Which are some leading companies which offer Industry 4.0?

Some leading companies in this market are IBM, Siemens, Microsoft, ABB and KUKA AG.

Which region is expected to showcase high growth in Industry 4.0 demand?

East Asia is estimated to have the highest growth for the industry 4.0 during the forecast period of 18.9%.

What is the driving demands for implementing Industry 4.0?

Reducing costs, improving efficiency, speed and meeting net-zero targets.

Which Solution had the largest market share for the Industry 4.0 in 2022?

Hardware had the largest market share of 39.6% in 2022 by solution.

Which technology has the highest CAGR for the Industry 4.0?

5G has the highest CAGR of 22.7% for the forecast period by technology.

Which are the top five countries for Industry 4.0?

USA, Germany, Japan, United kingdom and China.

What was the market share of South Asia and Pacific region for Industry 4.0 in the year 2022?

The market share of South Asia and Pacific for the year 2022 for the industry 4.0 was 15.4%.

What was the market share of North American for the year 2022 for Industry 4.0?

North America had a market share of 26.5% in 2022 for industry 4.0.

Which country has the highest CAGR for the forecast period?

China has the highest CAGR for the forecast period, which is 29.1%.

What is the estimated market value of Industry 4.0 for 2024?

The estimated market value for Industry 4.0 for the year 2024 is US$ 104.5 Billion.

What is the growth rate for North America for Industry 4.0 for the forecast period?

For North America region, the CAGR for the forecast period is estimated to be 16.5% for the industry 4.0.



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