Warehouse Automation Market Survey: Post COVID-19 Opportunities Worth $30B by 2026
According to a recent market study by LogisticsIQ, the Warehouse Automation market is projected to grow from $14 billion to $30 billion between 2020 and 2026, representing a 14% CAGR. While the market is estimated to have contracted ~ 5% due to COVID-induced economic uncertainty, industry indicators point to strong order intake which should drive integrator and OEM revenue higher in 2021 and 2022.
The United States has been the key region to target with an estimated $4B market size in 2019 and forecasted 12% annual growth over the next five years. Germany is the traditional hub in Europe with ~35% market share in the region. Regions forecasted to see higher future growth include Southeast Asia, India, and Australia, which are the key APAC markets after China, Japan, and South Korea.
The AGV / AMR market is expected to grow at a 30%+ CAGR and reach $5 billion in 2026. AMR will be a significant contributor to automation in retail warehouses given the flexibility to deploy robots without any major changes needed to warehouse infrastructure. AMR is expected to be preferred in small and mid-sized warehouses given lower cost and ease of deployment, however ASRS is expected to be the preferred solution in large warehouses given the superior pick rate per hour.
There are approximately 10 large and 10 to 20 midsized companies operating in the material handling equipment space that are capable of delivering comprehensive automated warehouse solutions. The 10 largest companies (Dematic, Daifuku, SSI-Schaefer, Honeywell Intelligrated, Knapp, Toyota, Muratec, Swisslog) capture more than a 50% market share. Many start-ups are emerging in new categories such as AMRs, Picking Robots, Micro-Fulfillment, and Autonomy Service Providers, among others.
Increasing Focus on Service Models
As the installed base of automated warehouse solutions grows, industry players expect an increase in revenues from maintenance and services, which would have a positive impact on profitability given the higher margin profile compared to new equipment sales.
Consolidation of material handling equipment providers is increasing as traditional players see acquisition of technology leaders as an increasingly attractive way to enhance competitive positioning in response to changing market trends. Acquisitions by KION (Dematic), KUKA (Swisslog), Toyota (Vanderlande, Bastian Solutions), Hitachi (JR Automation), Honeywell (Intelligrated, Transnorm), Korber (Cohesio Group), and Teradyne (MiR, Energid, AutoGuide Mobile Robots) are some of the recent examples of this consolidation.
Largest Warehouse End Users Embracing Automation:
Amazon Robotics is automating the company’s fulfillment centers using more than 200,000 AMRs, up more than 600% from 30,000 at the end of 2015. In 2020, DHL announced a $300 million investment to modernize 60% of its warehouses in North America with IoT and autonomous robots. The company also committed to deploy 1,000 LocusBots for delivery fulfillment. The intitiative is focused on bringing the emerging technology to 350 of DHL Supply Chain’s 430 operating sites.
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