Presence of a large number of multinationals with vast funds to invest in R&D practices, a rapid pace of technological advancement, and integration of smart technologies in packaging automation solutions are all rendering the global packaging automation market highly competitive, observes Transparency Market Research in a recent report.
The highly promising market already has several companies, hinting at a fragmented market space. In a bid to strengthen their hold on the market, companies are focusing on mergers and acquisition as a way of easy expansion of product portfolios as well as consumer-bases across diverse regional markets.
In October 2016, Rockwell Automation Inc., one of the leading companies in the field of industrial automation, acquired the company Maverick Technologies, which is renowned for its innovations in the field of packaging automation. The acquisition is envisioned to help the former strengthen its expertise in the fields of batch application and several other packaging processes and help its clients gain improved competitiveness through improved process control and information management. Rockwell Automation also acquired MagneMotion, a leading manufacturer of smart conveyor systems, in February 2016; the strategy could help the company build smart packaging technologies across the globe.
Transparency Market Research states that the global packaging automation market will exhibit a promising 9.7% CAGR over the period between 2017 and 2025, rising from a valuation of US$31.12 bn in 2016 to an opportunity of US$69.73 bn by 2025.
Vast Reduction in Time-to-Market to Encourage Adoption
Of the key factors expected to have a definite positive impact on the future development of the global packaging automation market, the rising cost pressure, high intensity of competition, and the need to reduce costs in the packaging sector by the introduction of automation in processes and operations are the notable ones. The rising demand for innovative packaging methods across a number of industries is also contributing to the increased interest of packaging companies in automation technologies. Other factors bolstering the demand for automation technologies in the packaging sector is the need to switch between a numbers of packaging designs, product variants, and still ensure shorter time to market of new product varieties.
Europe to Remain Key Adopter of Automation in Packaging
Of the key applications of the packaging automation market, the report states that that palletizing segment will rake in the dominant share in the global market by the end of the forecast period. The segment, which also accounted for a significant 27% of the market in 2016, will register a promising growth pace over the report’s forecast period.
From a geographical standpoint, the market for packaging automation will earn a significant share from regions such as North America, Europe, and Asia Pacific. The market in Europe, which accounted for over 37% of the total revenue of the global market in 2016, will continue to be the leading contributor of revenue to the global market over the forecast period.
High Capital Investment could Deter Adoption from SMEs
While the market has mostly positive growth opportunities, the high cost of implementation of automation could deter small- or medium-scale enterprises (SME) from adopting automation technologies. While the huge capital investment required to implement automation is a reality, the cost can be easily recoverable. As companies start understanding this, along with the fact that automation leads to vast improvements in time-to-market and massive reduction in overall cost of operation, automation will see improved adoption from SMEs also.