2017 proofed to be an outstanding year for the machine tools industry. China was one of the main drivers of demand in machine tools, having a strong impact on surrounding machine tool exporting countries, but also on China itself. Japan’s production of machine tools increased by around 22% year-over-year in value and even over 45% in units. Germany showed a 7% growth in production value, Italy almost 10%. The list of positive figures goes on and one. The question is how will the market develop in 2018?
Until now, the trend seems to continue. Japan produced around 20% more in value in the first two quarters 2018 compared to the same period of the previous year. Germany produced 11% more than in 2017, while Italy is at slightly over 9%. Assuming that orders and production stay at least stable for the rest of the year, the machine tool industry can expect 2018 to be another record year. This of course will have a significant impact on automation sales. CNC systems will experience robust growth in 2018, possibly around a two-digit growth rate. Drives, sensors, and other required automation components will also see higher demand coming from this market.
In the long run, we expect a slowdown in the following years, since the market has reached an all-time high. There are some global market trends that point towards continuing growth like increasing population, resulting in a rising demand for e.g. cars and planes and higher demand for electric devices that require machine tooling. Yet other trends might inhibit further strong growth, these are the electrification of the drive train, protectionist policies, and the slowdown in the Chinese market due to the lower to non-existing governmental subsidies for the machinery market.
ARC will soon publish its newest edition of the CNC systems global market analysis report, which will give further insight into this market.