Government initiatives that followed the Paris Agreement on climate change signed in 2016 are expected to increase the global demand for electric vehicles in the forecast period, which will drive demand for mechanical power transmission equipment. For example, China plans to have at least 20% of the vehicle production to be represented by electric and hybrid vehicles by 2025, Norway’s share of sales of electric vehicles among other types of vehicles is expected to increase to 100% by 2025, and California’s plan to sell “green” vehicles representing 35% of the total sales by 2025 was signed by 9 USA states. Expected increase in the production of green vehicles supported by governments’ initiatives will encourage a significant proportion of the population to invest in electric vehicles and replace their existing automobiles that are running on fossil fuels. This will drive the mechanical power transmission equipment market in the forecast period, as it is a major supplier of metal automobile components to automobile manufacturers.
The global mechanical power transmission equipment market is expected to grow from around $73 billion in 2019 to more than $96.5 billion in 2022 at a compound annual growth rate (CAGR) of 9.6%.
Technological developments in the areas of automation and Internet of Things (IoT) technology are also significant drivers of the mechanical power transmission equipment market. Development of automating devices such as robotic equipment is improving production efficiencies of machinery equipment manufacturing plants. These robotic machines are capable of reducing production costs by decreasing the maintenance costs and power consumption. Integration of IoT technology improves the efficiency of production process by taking appropriate action during the production process in real time without man intervention. These technological developments allow companies to maximize production and reduce costs, which is expected to make the mechanical power transmission equipment market attractive for investors. For instance, Voestalpine Bohler Edelstahl GmbH & Co KG, a Germany-based forging company, announced to install p-44 automated system, which is capable of recording and evaluating production data to improve production processes.
IoT is rapidly penetrating key industries that utilize mechanical power transmission equipment. Therefore, power transmission components are now being fitted with sensors to measure temperature, run time and vibration. The data gathered through the sensors enables industrial designers to design equipment based on data analytics to further improve power transmission systems. Sensors are also being used in machines to accrue invaluable data for improving efficiencies and preventing potential breakdowns. For example, smart bearings are being developed with continuous monitoring ability to predict faults before they happen.