ARC Advisory Group Industry Market Update October 2024

Overview

To provide our Advisory Service clients with holistic coverage of the various industrial and automation markets we cover, ARC Advisory Group publishes indices of revenues from automation, and machinery companies as well as indices of revenues and CapEx from end user industries on a quarterly basis.  This Special Report is concise and focuses more on the quantitative than the qualitative aspects of the automation, end user, and machinery industrial markets. 

Automation Index: Raw vs. Seasonally Adjusted Data

• Per Q2 2024 results, global automation markets continued to see a slower growth on YoY basis.
• The YoY growth cycle started showing a decline since late Q3 2023 and shows further decline of about 10 percent.
• Majority of the growth is driven by electrification and process industry segments.  
• Continued demand from the US and some key economies in Asia except China, and weak demand from Europe markets.  
• While the raw data shows a marginal growth of about 2 percent, seasonally adjusted data shows stable with no growth.

Americas

• Demand for automation products continued to expand in the US market but at a very low growth of around 2 percent. 
• The registered growth in Q2 2024 was slightly low compared with previous quarter (Q1 2024) but it was almost one-fifth compared with the YoY growth in Q1 2023. 
• The YoY growth cycle pointed to no growth in early 2024 and points to further decline in Q2 2024.
• Growth was predominantly driven by infrastructure industry sectors, notably electrification, energy transition, LNG, oil & gas, mining, sustainability and decarbonization, e-Commerce, warehouse automation, and buildings. 
• Strong declines in discrete and hybrid industry sectors: automotive, food & beverage, chemicals, semiconductors, and life sciences.

Europe

• The automation markets in Europe recorded a decline in Q1 2024, which was the first time since the beginning of the market recovery compared to Q1 2021. However, Q2 2024 results show positive growth but at lower single digit.
• Per Q2 2024 results, the YoY growth cycle points to further decline of about 5 percent, the decline was for the past four quarters in a row since Q2 2023 on YoY basis, but the decline is the lowest in Q2 2024. 
• Weak demand for discrete automation segment and moderate demand from process automation industries. Marine, ports, oil & gas saw positive developments.

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