Global Machine Tools Market - Focused Insights 2024-2029

MARKET INSIGHTS

The global machine tools market, based on consumption, was valued at USD 127.39 billion in 2023 and is projected to grow to USD 171.37 billion by 2029, marking a CAGR of 5.07% throughout the forecast period. The growth of electronics and their manufacturing applications has greatly influenced the machine tools sector. The inclusion of semiconductors and microelectronics has expanded the capabilities of many manufacturers, resulting in increased automation in both metal-forming and metal-cutting areas. Industries demanding high precision have quickly embraced advanced technology in machine tools. There has been a significant rise in the demand for high precision, large-scale production, and automation with reduced human involvement across all industries and regions. The pandemic has hastened the push for automation as businesses aim to decrease the number of employees on production floors. This trend is anticipated to lead to substantial sales growth in the machine tools sector.

In terms of production, the global machine tools market was valued at USD 134.96 billion in 2023 and is expected to rise to USD 169.47 billion by 2029, showing a CAGR of 3.87% for the forecast period. In addition, a geographical analysis reveals that the demand for machine tools is fueled by both new installations and replacements. In mature markets like Europe and North America, there is a strong demand for replacement tools. In contrast, emerging markets in areas such as APAC, the Middle East and Africa, and Latin America show a robust demand for new installations, leading vendors to create targeted installation strategies.

MARKET TRENDS & DRIVERS

Rise in Automation

The rise in automation, fueled by technologies such as IoT and AI, is rapidly transforming the machine tools market like never before. This shift is not only changing traditional manufacturing methods but is also influencing the industry's future. IoT allows machine tools to connect with each other, facilitating smooth communication among machines and systems on the production floor. IoT sensors installed in machines gather real-time insights on operations, performance, and condition, which enables predictive maintenance and reduces downtime. Machine tools equipped with IoT can communicate and align with other systems (like ERP, PLM, MES) for comprehensive visibility of production, enhancing decision-making and minimizing reliance on human intervention. AI, when integrated with machine learning algorithms, enables machine tools to become intelligent by learning from data and optimizing processes autonomously. Automation is viewed as a crucial factor for enhancing operational efficiency. With AI and IoT, machine tools can work at higher speeds and with improved accuracy, reducing human errors. Automation shortens cycle times, refines tool paths, and guarantees consistent quality, which is vital in sectors such as aerospace, automotive, and electronics. Governments and industry stakeholders are heavily investing in smart factories, where the integration of IoT, AI, and robotics is key to this evolution, and machine tools play a significant role in this change.

Expansion in Automotive Sector

The swift expansion of developing economies has considerably contributed to the growth of the global automotive industry. As vehicle demand increases in emerging markets, manufacturers face significant opportunities to take advantage of this growth. Emerging markets have seen strong industrial development and rising foreign trade, especially within the BRICS nations (Brazil, Russia, India, China, and South Africa). China's extensive fiscal stimulus measures have established it as a front-runner among emerging economies in recent times. As automotive production ramps up to fulfill increasing demand in developing economies, the necessity for precision machining and high-quality components grows. Machine tools such as CNC machines, lathes, and grinders are essential for the mass production of critical automotive parts such as engines, gearboxes, and chassis components. Particularly, the shift towards electric vehicles (EVs) has heightened the need for advanced machining tools, as EV manufacturing often involves new and complex machining requirements. The transition towards lightweight materials in vehicle production, including aluminum, carbon fiber, and composites, has led to a demand for specialized machine tools capable of precisely handling these materials.

GLOBAL MACHINE TOOLS MARKET INSIGHTS

• By Tool: The metal-cutting category held the largest global machine tools market share. These tools are essential for a range of machines performing various functions, from straightforward cutting to complex shaping. Consequently, the metal-cutting tool market is marked by ongoing technological progress, with numerous firms vying for a larger market share in this fiercely competitive field. The demand for metal-cutting tools remains robust across various sectors, including automotive, aerospace, construction, and electronics, due to their aptitude for handling intricate tasks with high precision. Within the metal cutting segment, the laser, EDMS, & other tools market demonstrates the most significant growth during the projected period. Electrical Discharge Machines (EDMs) and other advanced cutting tools are crucial to contemporary manufacturing, employing cutting-edge technologies like Electro-Discharge Machining (EDM), Electro-Chemical Machining (ECM), Ultrasonic Machining, and Laser Machining. Following the resumption of manufacturing activities and businesses adjusting to new norms post-pandemic, demand for EDM, laser machining, and other modern cutting tools began to rise again. This trend hints at a positive outlook for the market in the years ahead, highlighting opportunities for vendors to leverage the pent-up demand and the growing emphasis on advanced, precision-oriented manufacturing solutions.
• By Technology: The global market for machine tools is segmented by technology into CNC and non-CNC categories. The Computer Numerical Control (CNC) sector is experiencing notable growth, demonstrating the highest compound annual growth rate (CAGR) of 5.67% during the projected period. CNC technology has become a crucial element in contemporary manufacturing, gaining extensive traction worldwide. As industries increasingly adopt automation, CNC machines are becoming essential across various fields. These state-of-the-art CNC systems are highly sophisticated, capable of performing both design and manufacturing tasks autonomously. With the rise of Industry 4.0 and the evolution of smart factories, manufacturers are focusing on integrating CNC machine tools to optimize operations and improve efficiency, thereby fostering growth within this segment.
• By End-User: Regarding end-users, the automotive sector commands the largest share of the global machine tools market. The automotive industry represents the most significant segment of machine tool consumption. Prior to the COVID-19 pandemic, the global EV market was growing at an impressive annual rate of 60%. This expansion, coupled with an increase in production facilities, was projected to drive further demand for machine tools as production ramped up in factories. The surge in EV manufacturing was particularly prominent in regions like China, Japan, the US, and Western Europe, where manufacturing activities have been intensifying in recent years. The automotive sector remains a major driver of global economic growth and continues to grow across most areas. Emerging economies account for the largest share of global automotive production, with numerous manufacturers eager to resume production.

GEOGRAPHICAL ANALYSIS

The machine tools market is led by the APAC region, which holds more than 46% of the global market share. Following the COVID-19 pandemic, the machine tools sector in APAC is anticipated to experience substantial growth due to the revival of economic and infrastructure activities. Recognized as a worldwide economic center, APAC significantly contributes to global GDP. Major countries in this region include China, India, Japan, South Korea, and Australia, with China representing a large portion of global manufacturing output. As the largest manufacturing economy in the world, China produces a wide range of products, from consumer electronics to automobiles and heavy machinery. Rapid urbanization and industrial growth in many APAC nations are resulting in an increased need for infrastructure, machinery, and equipment. This rising demand directly influences the requirements for machine tools and other production technologies.

COMPETITIVE LANDSCAPE

The report on the global machine tools market features unique information about 25 vendors. The competitive environment in the global machine tools market is fragmented, showing a mix of several leading players along with many regional and local manufacturers. A handful of major companies currently hold a significant share of the market. Notable firms that dominate the sector include DN Solutions, AMADA Group, Makino, and JTEKT Corporation. Their key strategies involve product innovation, mergers and acquisitions, and partnerships to boost market presence and expand into new regions. Collaborative efforts with OEMs and other industry participants aim to create integrated solutions and enhance market penetration.

RECENT VENDOR ACTIVITIES

• On September 6, 2023, DMG MORI revealed its acquisition of KURAKI, which is under the ownership of Kurabo Industries. By incorporating KURAKI’s advanced development and manufacturing techniques, DMG MORI intends to improve its product lineup and widen its customer reach.
• On April 3, 2023, Okuma Corporation, a worldwide leader in the design and production of CNC machine tools, announced the establishment of a new business segment, the Okuma Factory Automation Division. This initiative is a response to the increasing demand from manufacturers for automated machining systems and cells to address labor shortages and boost production capacity. It will be based at the company’s headquarters in Charlotte, North Carolina.