The global process automation and instrumentation market size is expected to grow from USD 66.2 billion in 2022 to USD 86.6 billion by 2027, at a CAGR of 5.5%.
The growth of this market can be attributed to the growing importance of energy efficiency and cost optimization, increased productivity, minimized errors and better scalability; the increasing use of digital technologies such as IIoT, machine learning, and artificial intelligence; and the rising emphasis on industrial automation and optimum utilization of resources.
Key Market Players
ABB Ltd. (Switzerland), Emerson Electric Co. (US), Siemens (Germany), General Electric Company (US), and Schneider Electric (France) are a few major players in process automation and instrumentation market.
Impact of COVID-19 on the Process Automation and Instrumentation Market
The outbreak of the COVID-19 pandemic had negatively impacted the growth of the process automation and instrumentation market in 2020 due to disruptions in the supply chain and a decline in demand. The worldwide outbreak of COVID-19 has forced many businesses to limit their production and halt most of their operations. During this crisis, the main objective of the companies was to sustain their businesses by finding safer ways to continue manufacturing operations or find other sustainable ways to get the revenue stream flowing. The future impact is uncertain and depends on the spread of COVID-19 or the success of control measures undertaken to curb the spread of the virus.
Market Dynamics
DRIVERS: Increasing focus of manufacturing firms on achieving cost saving and better efficiency
Industries worldwide increasingly focus on improving production efficiency and reducing operating costs to sustain in the changing global industrial environment. The efficiency of a production site is assessed by its ability to respond quickly to rapid and unexpected changes in demand, preferences, and resource availability. This can be accomplished through process automation. Instrumentation products help measure and analyze process parameters such as pressure, temperature, level, and humidity, while process automation solutions help monitor and control processes to lower rework costs, minimize inspection costs, and reduce system failures. Thus, process automation helps manufacturing firms decrease costs and increase revenue. Industries are actively adopting process automation and instrumentation solutions across their production sites to streamline industry operations, achieve enhanced productivity, and reduce labor-related costs.
RESTRAINTS: High implementation and maintenance costs associated with process automation
Establishing a new automated manufacturing plant requires deploying the latest automation technologies such as SCADA, DCS, PLC, and HMI. One of the most significant factors limiting the growth of the process automation and instrumentation market is the need for high initial investments to set up an automated production plant. Huge capital is required to deploy automation solutions such as DCS and SCADA, as well as instrumentation devices such as process analyzers and transmitters. The installation of solutions such as DCS at an industrial site involves various stages, including system implementation, process running, data acquisition, and consultation; this subsequently increases the overall costs, thereby increasing the operating expenses of the plant owner. Furthermore, automation software solutions require frequent upgrades owing to ongoing technological advancements. It is not feasible for small businesses to bear such expenses. Thus, system installation, maintenance, and upgrade require huge capital investment, restricting market growth to a certain extent.
OPPORTUNITIES: Growing adoption of Industry 4.0 by manufacturing firms
The process automation market is expected to grow at a significant rate owing to the rising adoption of Industry 4.0 principles in manufacturing industries, including oil & gas, food & beverages, chemicals. With the adoption of Industry 4.0, most processes and systems in the manufacturing sector are automated using a variety of technologies, such as cyber-physical systems, IoT, cloud computing, which allow production units to operate efficiently 24/7 with zero human errors. It helps reduce production cycle time, achieve process efficiency, right from the raw material procurement stage to the development of the end product. Automation enhances industrial processes through improved communication and self-monitoring techniques, intelligent collection of real-time data, which analyzes and diagnoses issues without human intervention. Industry 4.0 enables improvement in operational efficiency, productivity, product quality, asset utilization, supply chain management, workplace safety, and environmental sustainability. Thus, the adoption of Industry 4.0 principles by several industries is expected to create lucrative opportunities for market players in the next few years.
CHALLENGES: Shortage of skilled personnel to operate sophisticated automation systems
Skilled resources are required to operate process automation and instrumentation solutions because of the complex processes, which can be misinterpreted and may lead to errors and faults if handled by an unskilled workforce. As artificial intelligence (AI) and the Internet of Things (IoT) are changing the nature of work, process automation will accelerate the shift in required skill sets. The demand for a skilled workforce will increase as companies seek to use IoT data to predict outcomes, optimize operations, prevent failures, develop new products, and deploy advanced analytics competencies, including artificial intelligence (AI) and machine learning (ML), in manufacturing. Process automation systems integrated with advanced technologies, such as AI and IoT, need attention and expertise while handling various scenarios. Therefore, the shortage of skilled workforce creates challenges for providers of process automation and instrumentation products.
“Field instruments dominated the global process automation and instrumentation market in 2021”
Field instruments assist in managing plant assets, enhancing plant safety, and optimizing overall production processes through data acquisition, control, and measurement. It is necessary to obtain key information regarding major parameters, including temperature, pressure, and level, to monitor and control processes quickly, smoothly, securely, and accurately, as well as to achieve optimum productivity. These instruments play a pivotal role in measuring and controlling process parameters in process industries. For example, in June 2021, Emerson Electric Co. introduced a new Rosemount 1408H level transmitter, specifically designed for the food & beverages industry. The constant release of advanced products to automate industrial processes and measure and control different process parameters is expected to drive the process automation and instrumentation market for field instruments.
“Asia Pacific to grow at the highest CAGR during the forecast period of 2022 to 2027”
In terms of region, Asia Pacific led the global process automation and instrumentation market, followed Asia Pacific led the global process automation and instrumentation market, followed by North America and Europe in 2021. In Asia Pacific, the demand for process automation and instrumentation solutions is growing from the oil & gas and food & beverages industries due to the ever-increasing population in Asia Pacific. Increasing investments in clean energy infrastructure in Asia Pacific to meet escalating demand for electricity and reduce reliance on fossil fuels to generate energy. Also, the process automation and instrumentation market for the pharmaceuticals industry in this region is expected to grow at the highest CAGR from 2022 to 2027 due to changing regulatory environment. Also, advantages such as higher reliability and flexibility and greater speed and accuracy offered by process automation encourage pharma companies to adopt process automation and instrumentation solutions.
