March 2008

Automation outlook 2008 still positive

The automation marketplace holds much promise for growth in the 2008, despite dour economic news promulgating the media.

ARC Advisory Group reported the automation and manufacturing sectors will grow again at a healthy rate this year.

The need for modernization of the North American industrial infrastructure, growth in the hydrocarbons sector, and growth in other industries such as life sciences and primary metals will drive overall growth in North America through this year and into next. 

Growth also will come from China, India, Latin America, and the Middle East. Russia and Eastern Europe will also continue to provide strong growth opportunities.

ARC concedes that certain sectors of North American manufacturing are vulnerable to economic uncertainty right now. The building sector, including segments such as building materials and wood products, bears watching. Other sectors like the U.S. automotive industry and its dependents have been sliding for years.

China is still going strong and represents the best growth prospect for the global automation marketplace over the next five years, and growth in 2008 will about match that of 2007.

The impact of reduced consumer spending in the U.S. will have a minimal impact on the Chinese economy for 2008 as well. 

ARC is especially looking to the batch process industries in China. The drive toward higher quality standards and regulatory compliance in China and the creation of excellent food and beverage, pharmaceutical, and consumer products companies is a national priority for China, especially in the wake of product safety concerns that have affected the China market in the past year. 

There is much room for improvement as China consolidates these industries and adopts more sophisticated levels of automation.