Page 34 - MetalForming January/February 2022

2022
of an Industry 4.0 transformation that appears, while in its early stages among many metal formers, to be on the edge of an explosion. Devereux concurs, writing: “Digital transformation is poised to grow exponentially as man- ufacturers retool operations to main- tain their competitive advantage. Industry 4.0 capabilities, data man- agement, robotics, machine learning and other aspects of digital transfor- mation will soon be table stakes just to compete for customers and talent. Companies that haven’t developed a digital transformation strategy should start planning now, before their hands are forced and decisions are rushed.”
With that, here we break down the outlook for a handful of key sectors for metal formers and fabricators.
Automotive
Chip shortages, worker shortages, unpredictable OEM production sched- ules and rising prices combined with limited supply of commodities have created a perfect storm plaguing the automotive supply chain. Overall, “with just one month remaining,” notes a December 2 report from LMC Auto- motive, “light-vehicle sales in 2021 appear locked in at 15.0 million units. The month of December is expected to be more of the same, in terms of a selling rate—13.1 million units—the average that the market has been stuck at since June.
“The pace of plant shutdowns in North America has slowed from pre- vious months,” the report continues, “and we have reduced the expected
production loss in Q4, due to chip shortages and other disruptions, by 100,000. However, vehicle manufac- turers are choosing to slow the daily build rate instead of shutting down the entire plant, reducing the visibility of output downtime. With the slight improvement, the 2021 production forecast remains at 12.9 million units, 6000 units lower than 2020. With some additional stability in production, the outlook for U.S. auto sales has improved slightly for 2022—from 15.7 million units to 15.9 million units, an increase of 6 percent over 2021.”
Jeff Schuster, president, Americas operations and global vehicle forecasts at LMC, adds: “A slight improvement in production is welcome news for the industry, though we continue to expect 2021 to have lost 2.4 million units due to the semiconductor shortage. 2022 most certainly will be challenging but if the consumer remains optimistic and demand continues, the recovery is expected to remain intact. Other risks remain elevated, including con- cerns with the Omicron variant and lingering inflation, keeping the current environment very dynamic.”
On the tooling front, “the next decade is being forecast as generally favorable for suppliers of automotive tooling,” shared Laurie Harbour, pres- ident and CEO of Harbour Results Inc. (HRI), during her 2021 Automotive Tooling Outlook report.
“The performance of manufacturing overall is really quite good,” Harbour said. “Durable goods demand is very strong, driving not only new volume but
new programs, so lots of new models.” We’ll have much more to say on the automotive industry in our February 2022 special issue focused exclusively on this most important market to metal
formers.
Medical
The global medical-device outsourc- ing market is expected to reach $227.1 billion by 2028 and register a CAGR of 11.2 percent during that time, fueled by rising demand for advanced medical products. That according to a 2021 Grand View Research report. Yet anoth- er report, from Technavio, reveals slightly less optimism, predicting the medical-device manufacturing out- sourcing market to record a CAGR of 7.81 percent through 2025. It attributes the growth to a focus by OEMs on reducing manufacturing costs amid increased complexities in product design and development.
(Editor’s note: Last year in this space, we wrote: “The global medical-device outsourcing market was expected to grow at a compound annual growth rate of 10.4 percent from 2020 to 2027.”)
Without question, the ongoing pan- demic has directed a spotlight onto the medical-device industry, with demand skyrocketing for PPE, diag- nostic tests, ventilators and other crit- ical supplies. Suppliers are busy ramp- ing up manufacturing capacity and capabilities, with many expanding out- side of their normal customer bound- aries, while OEMs have focused on developing more versatile, diverse sup- ply chains. Other industry trends include development of open-source equipment-design processes, and establishment of partnerships with companies not typically involved in the medical-equipment sector.
Over the past few years, medical devices have become more complex both in design and materials used. As a result, many manufacturers have begun searching for ways to reduce material costs and quicken the manu- facturing process.
Want to join, or remain, in the med- tech supply chain? Focus on developing
32 MetalForming/January-February 2022
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