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ITA Special Report: US Market for Advanced Manufacturing

The USA Market for Advanced Manufacturing (AM) and Robotics

Manufacturing in the U.S. has often been assumed to be in long-term decline, with the competitive advantage moving to low-cost countries such as Mexico and China. However, with advanced technologies likely to automate as much as 60% of factory tasks, in the future low-cost countries may no longer enjoy a competitive advantage, and the USA could well regain lost ground.  Although many basic and low value-added products have moved out of the USA, the country still has an incredibly thriving manufacturing sector with more than $4 trillion in annual output and a limited exposure to foreign trade since, in aggregate, it produces the vast majority of what it consumes domestically.

Regarding advanced manufacturing overall, the Institute for Supply Management in the summer of 2019 estimated that by the end of the year production capacity in manufacturing industries is expected to show a 4.5 percent growth. 

To spur this growth, USA manufacturers are prioritizing their investments in a very broad range of new technologies, as reported by IndustryWeek Magazine’s report of 2019 “The Future of Manufacturing: 2020 and Beyond”; the main purposes of such investments are as follows, ranked in descending order of relevance according to the interviewees. 1 Higher productivity, 2 faster responsiveness to customer orders and requests, 3 enhanced collaboration with customers and suppliers, 4 enhanced market intelligence, 5 more effective customer communication.

Robotics is an area where USA manufacturers have begun to understand that they need to be more aggressive in developing and adopting new technologies. In fact, the International Federation of Robotics reported that, for the eighth year in a row, robot installations in the USA reached a new peak level (40,373 units, +22%). Since 2010, the automation of production processes in all the country’s manufacturing industries has been the ongoing trend. Regarding annual installations, the US took third position from the Republic of Korea in 2018.

One of the major technology adoption trends for the next decade is the industrial wearable segment which reported $1.5 billion in 2017 and is forecast to increase to $2.6 billion by 2023. It would be a 73% jump that many experts actually consider to be a conservative estimate. From field service to assembly, the most effective workers of the next decade will be wearing an array of smart glasses, biometric sensors and other devices that connect them to not only work instructions or critical data, but to each other to create the IIoP (Industrial Internet of People). According to Global Market Insights, the exoskeleton market size was valued at over $220 million in 2018 and will witness around 41.5% CAGR up to 2026, with the passive exoskeletons having already witnessed a significant adoption hold in the heavy tools & machinery industries. 

In terms of new production technologies being embraced, the US 3D printer market continues to show sizable growth with a significant +29% CAGR between 2017-2024, according to the firm Research Nester. The USA along with Canada will account for a substantial portion of market share with 37% in said period on the back of various factors such as growing technological advancements and implementation of 3D technology. A market research firm, Wohlers, forecasts that in 2020 the market will be valued at $15.8 billion for all AM products and services worldwide. Manufacturers' revenue is forecasted to reach $23.9 billion in 2022, and $35.6 billion in 2024. Further, the profitability of USA companies will remain on the rise due to increasing demand and their exponential revenue growth which is expected to boom boosting overall growth of the market. The growing awareness and increasing number of industrialists that are driven towards 3D printing are anticipated to boost the market shares even further through 2024.

Another area in manufacturing which is reporting exceptional growth is the augmented reality market, which according to MarketWatch is set to exceed $50 billion by 2024, with shipments forecasted to grow at over 75% CAGR from 2017 to 2024. This growth can be attributed to its increasing penetration in industrial applications, notably in the automotive sector, and in the retail and medical sectors, which are leveraging the potential of the technology to enhance operational efficiency.

Cybersecurity will maintain itself as a top priority for USA manufacturers well into 2020 and beyond, as intellectual proprietary patented technologies and applications will remain under continued threat of being breached by domestic and foreign competitors. Earlier in 2019, Business Insider Intelligence had estimated that $655 billion will be spent on cybersecurity initiatives to protect PCs, mobile devices, and Internet of Things (IoT) devices by 2020, of which $386 billion will be spent on securing PCs, $172 billion on securing IoT devices and $113 billion expected to be spent on securing mobile devices - devices that thanks to IoT accessibility are becoming essential tools not only in after sale service and support but also becoming fully integrated within the actual factory floor ecosystem.

Recent ITA promotional programs in Advanced manufacturing

The Italian Trade Agency assists companies in trading and investing with foreign counterparts, on behalf of the Italian Government. Within the Agency’s USA network the Chicago Office is responsible at a national level for a number of sectors, including advanced manufacturing and technologies, upon which it has developed a particular strong focus. Through its activities, over the last several decades the Office has created strong ties with both industry and government and has  facilitated business development in local economies throughout the USA. 

Some initiatives in the area of advanced manufacturing follow. 

  • Since 2001 the Agency, via its Machines Italia project (Link), has been continually exploring and creating new opportunities in those areas of advanced manufacturing related to AI, IoT and machine learning, in favor of Italian companies and universities
  • In 2018 the USA network of the Agency created the Innovation Days, a program of events aiming to highlight Italy’s position in the most technologically advanced manufacturing industries and to effectively represent the Italian innovative ecosystem, through a brand built on the concepts of innovation, Industry 4.0 and relationship with research and universities. This brand has been iconized through the logo The Italian Extraordinary Tech and used for support actions in favor of both trade and the attraction of foreign direct investment. One of the five events of the program is documented here. 
  • With leading US and Italian associations and academic institutions as NIST, MIT, SME, ASME, AMT, Purdue University, Georgia Tech, Politecnico di Milano, Politecnico di Torino, UCIMU, and a number of companies, the Chicago office of the Agency organized two major events in 2018, the Advanced Manufacturing Conference in Milan in February and the Innovation Days in Detroit, Chicago and Rockford in June, to either create or enhance opportunities for Italian manufacturers and universities to engage and/or establish themselves in the US.
  • The 2019 edition of the Advanced Manufacturing Innovation Day USA will take place at IMECE in Salt Lake City, from November 10 to 14 and it’s themed The Italian way to Advanced Manufacturing. It features a panel discussion and a networking event in the conference space, an outreach booth in the exhibition space and a few site visits for the Italian participants (Link
  • On request, the Agency conducts fact finding tours in various USA States bringing leading Italian industrialists to engage with industry and academia to develop commercial opportunities and technology partnerships in the areas of mechanical engineering research, such as, for instance, the one carried out in 2017 for UCIMU and documented here
  • The Agency hosts Country Pavilions at leading USA advanced manufacturing trade shows, such as IMTS, PACKEXPO, IMECE, allowing companies to engage in productive commercial opportunities. It also takes part in national conferences, such as for instance EMTECH DIGITAL 2018, where it provides Italian thought leaders an opportunity to present the “Italian offer” in advanced manufacturing technologies and applications to audiences of both international and local counterparts.
  • In partnership with leading Italian machinery manufacturers associations, the Agency runs the Italian Technology Award Programs which annually bring students and faculty from leading USA universities to Italy allowing them to engage with counterparts and industry in sectors related to advanced manufacturing and reinforcing ties among the current and next generations of researchers and managers.