Growth Expectations in the SCADA Market

Compared to the hardware business in industrial automation, the SCADA software automation product market is expected to experience greater growth in the future.

What could be the causes?

• In part, because SCADA products are mainly used in large investments related to energy, such as in oil and gas or electricity facilities, an area that is performing better than other sectors.
• The strong growth of SCADA is also due to an increasing number of customers becoming aware of the importance of this type of software, which can improve the efficiency of their production lines.

The most important market for industrial automation investments, the American market, generated the highest sales revenue worldwide for SCADA in 2013. The largest contributor within this market is the U.S.

Why the American continent?

The main factors driving the scale and growth of America are investments in the oil and gas markets, as well as strong domestic consumption in the food and beverage markets. It’s not just the USA; Canada and the countries of Latin America also contribute greatly to the oil and gas industry.

What about Europe?

Europe was the second largest SCADA market in 2013, just behind America. The big driver of the European market is its strong machinery industry. Germany is the key SCADA user in the region, mainly due to the automotive industry.

As for Russia and the Middle East, they were the most prominent in oil and gas production, which is suffering from the decline in crude oil prices. This price drop is decreasing the investment opportunity. Europe as a whole is slowly crawling out of the recession. With tight fiscal policies and difficult credit conditions in several countries, with industrial oversupply and still relatively weak export demand, there are few signs of a strong rebound in the region in the near future.

China slows down

Asia-Pacific, which had been one of the fastest growing regions in recent years, is experiencing a significant slowdown. China is the main cause of that. China’s leadership has identified financial stability as its most important goal. Because of this, many of the investments have been delayed. Thus, the global Asian market had lower growth in 2013 compared to previous years. However, Asia still experienced the highest rate of expansion of all regions in the world due to its small revenue base and abundant investment opportunities. Investments are being made in industries related to basic domestic consumption, such as food and beverage and water and wastewater.

Another important country in Asia is Japan. Since 2012, the Japanese government has promoted strong economic incentive plans by implementing fiscal stimulus, participating in monetary easing, and implementing structural reforms. But measuring it in U.S. dollars, the market showed a decline in growth in 2013 because the currency had depreciated by more than 10 percent in terms of the yen’s exchange with respect to the U.S. dollar.