Factory Automation Market - Strategic Insights and Forecasts (2025-2030)

The factory automation market is expected to grow at a compound annual growth rate (CAGR) of 9.9%, from USD 346.1 billion in 2025 to USD 556.1 billion in 2030.

This growth is mainly attributed to the growing adoption of advanced technologies and automatic control devices that contribute to enhanced productivity and reduction of production costs. Additionally, in developed economies such as the United States and Europe, the availability of skilled labor is a significant issue where factory automation serves the purpose effectively. This is because with the rising penetration of advanced technologies such as artificial intelligence and robots, among others, automation facilitates activities such as material handling and quick production tasks.

Technological advancements are playing a huge role in manufacturing these days. Companies are switching towards new automation techniques to reach their maximum potential. In this context, Xiaomi took an important step towards factory automation with innovative products that stand out and embrace the concept of smart production. In 2023, Xiaomi’s Zeng Xuezhong, who is responsible for research and development and manufacturing, announced at the World Robot Conference that the company had completed the second phase of Xiaomi Smart Factory. This step signifies the leap toward smart manufacturing and industrial automation using technology.

Factory Automation Market Overview & Scope:

The Factory Automation Market is segmented by:

• Product Type: In the factory automation market, product type segmentation is divided into sensors, motion & drives, industrial control systems, manufacturing execution systems, software, and others. The rising demand for industrial automation needs will promote the application of industrial control systems, thereby also contributing to the factory automation market.

• Automation Type: The factory automation market, by automation type, is segmented into fixed, programmable, and flexible. The fixed automation system includes automated production processes and assembly to produce a single product. Whereas programmable automation enables changes in configurations and operation sequences of equipment as per commands in the system.

• Industry Vertical: In the factory automation market, source segmentation is divided into oil and gas, pharmaceutical, automotive, energy and power, printing and packaging, chemical, manufacturing, and others. The automotive and manufacturing sectors are expected to account for significant growth, coupled with growing demand for IoT solutions in these sectors to boost automation.

• Region:  By geography, the factory automation market is segmented into North America, South America, Europe, the Middle East and Africa, and Asia Pacific. The United States is one of the leading nations that is showing active investments in new technological innovations. The growing trend of smart manufacturing and initiatives to bolster industrial automation in the country have led to an upward trajectory in robotics installation in the country's major sectors, such as automotive, metals & machinery, plastic, and F&B, among others.

Top Trends Shaping the Factory Automation Market:

1. AI in Automation

• There is growing usage of artificial intelligence in automation. There is a growing application of predictive analysis in maintenance, quality control, project management, and flexible manufacturing processing methods. Artificial intelligence is used to make different technologies work efficiently, and can be controlled from a remote location.

2. Collaborative Robots

• Collaborative Robots are becoming a significant part of factory automation. The robots are being used for flexible and safer production lines. The robot density in the manufacturing industry has been 162 (robots installed per 10,000 employees) worldwide. South Korea had the highest density with 1,012, followed by Singapore with 770, then China with 470, and Germany with 429. This increasing robot density worldwide would expand the factory automation market.

Factory Automation Market: Growth Drivers vs. Challenges:

Drivers:

• Growing automotive sector: The increasing demand for automobiles worldwide has created a demand for smart manufacturing. There has been an expanding demand for electric vehicles, especially in countries like China, the USA, and Europe. Further, according to OICA, automobile production rose by 10% in 2023 from the previous year. Factory automation is necessary to create products to be price-competitive and quality-assured.

• Rising adoption of industrial automation worldwide: One of the primary reasons supporting factory automation market growth is the growing industrial automation worldwide. It minimizes the use of human intervention in industry and incorporates the use of control systems and information technologies to handle all industrial processes. Moreover, the development of the Industrial Internet of Things (IIoT) is the latest technological approaches that foster the production and management of the entire logistics chain.

Challenges:

• High Price:  The high price of installation and maintenance is stalling the growth of the market. Further, the lack of trained manpower to handle the machines is a serious challenge in the industry.

Factory Automation Market Regional Analysis:

• North America: The North American region is anticipated to grow at a significant rate in the forecast period, owing to increasing technological advancements and increased innovation in products by key market players.

• Asia Pacific and European regions are also expected to have subsequent market shares owing to the rapid increase in efficiency with the application of factory automation equipment.

Factory Automation Market: Competitive Landscape:

The market is fragmented, with many notable players including Siemens AG, Honeywell International, Rockwell Automation, Schneider Electric, Ametek Inc., Emerson Electric Co., Bosch Automation, General Electric, Johnson Controls, and ABB Ltd., among others:

Few strategic developments related to the market:

• Expansion: In February 2025, Honeywell announced the separation of Automation and Aerospace Technologies. Automation will be a pure-play automation leader.

• New Facility: In April 2024, Mitsubishi Electric opened a manufacturing facility for an advanced factory automation system in Maharashtra, India. The investment is about 24.5 million EUR in this facility. It would manufacture inverters and other FA products. This facility will support sectors like automobiles, pharmaceuticals, etc.

• New Facility: In April 2024, Ericsson invested EUR 200 million at the Athlone facility. This facility would support the automation capabilities used in 5G networks globally. This investment was supported by the Irish Government. It could be focused on the Ericsson Intelligent Automation Platform (EIAP) and network-powered rApps. 

Factory Automation Market Scope: