The Indonesia Automation and Control System Market was valued at USD 205.217 million in 2019 and is expected to reach USD 334.805 billion by 2025, at a CAGR of 8.5% over the forecast period 2020 - 2025. With Indonesia's steady amalgamation with the world's economy, Indonesia Automation and Control System will play an important role in bringing costs down. As Taiwanese and South Korean firms lead the industry in automation, Indonesia will become the area's production hub and the factory for Southeast Asia. The country’s GDP expanding by around 5.1% to 5.5% in 2018 (Bank Indonesia) and the inflow of investments have made it the epicentre of automation manufacturing, and several existing and innovative foreign producers plan to establish or grow their manufacturing plants in Indonesia. Fast-moving consumer goods manufacturers in Indonesia much depend on automation equipment because of their vast production capacities.
- The oil and gas industry in Indonesia has dominated the Process Automation and Instrumentation market as there is always a huge demand for safety and dependability from exploration through delivery. Though, the market share of the energy & power segment is estimated to improve substantially due to the increasing need for cleaner and smarter energy and elevated demand for non-renewable sources of energy production. For instance, the Indonesian government has planned USD 6.47 billion worth of energy projects by 2020, 70% of the budget is needed from direct foreign investment (Electric & Power Indonesia, 2019).
- Growing government funding to encourage automated systems in numerous industrial verticals, booming demand for automation from different manufacturing sectors, growing innovations in industrial robotics, swelling technological advancements in manufacturing, and demand for mass production and related supply chain to cater to the rising population are the important factors driving the growth of automation and process control systems market in Indonesia.
- Besides, rising digitalization and accelerating the speed of change, industry 4.0 innovation, expanding demand for safety compliance of automation products, and escalating manufacturing sector in emerging economies further delivers substantial opportunities for the several stakeholders in this market.
Scope of the Report
Industrial automation is a method of applying different and combined control systems to manage and operate machines and equipment in production facilities and factories. In addition to reducing costs, automation is being demanded to help increase productivity, aesthetics, efficiency, and delivery systems in the production of automotive assemblies, aircraft, steering, and ship stabilization, heat treating boilers and ovens, and other machinery.
Key Market Trends
Power Generation to Drive the Indonesia Automation and Control System Market
- Augmented adoption of automation and Control products across power generation, increasing oil and refineries industry, fluctuating production approach from conventional practices to digitalized approaches, acceptance of multivendor portable applications, rising regulatory compliances in power industries, amplified usage and application of SCADA, MES, PLC, and DCS in power industries, growing adoption of IoT and growing labor wages in prime manufacturing hubs are some of the chief factors increasing the market growth.
- The power industry in Indonesia has experienced around 3.3% annual growth in the last year. However, according to the Ministry of Energy and Mineral Resources (MEMR), by December 2017, the electrification ratio of Indonesia has reached 94.91%. Papua and East Nusa Tenggara are the regions with the lowest electrification ratios, with 60% according to 2017 MEMR data, which could have a positive impact on the power sector of Indonesia.
- The new National Electric Generation Plan (RUPTL) 2018-2027 forecasts that electricity demand in Indonesia will grow 6.86 % annually. According to RUPTL estimates, by 2027, electricity demand will reach 443 terawatt-hours (TWh) from 78.4 million customers and the electrification ratio will reach 99.4%. Achieving a total of 35 GW would require an investment of an estimated USD 72.9 billion.
Oil and Gas Holds a Dominant Position in Indonesia Automation and Control System Market
- Indonesia’s more than 60% of oil production and more than 30% of gas production come from late-life-cycle resources. EOR techniques can significantly extend the life of older fields and boost the amount of oil and gas recovered.
- The Oil and Gas industry dominated the automation and control market as there is constantly a huge demand for safety and dependability from exploration through delivery. However, the market share of the oil and gas segment in Indonesia is projected to enhance significantly over the projected period due to the rising demand for cleaner and smarter energy and elevated demand for non-renewable sources of energy production.
- Oil and gas companies in Indonesia have to invest regularly in integrated automation technologies to be more transparent, given the various regulations related to performance, and tighter limitations on carbon emissions.
- Besides, Oil and Gas manufacturers in Indonesia greatly rely on automation equipment because of their huge production capacities. For instance, Rockwell is one of the leading automation manufacturers in Indonesia, Rockwell’s clients in the country are primarily from the oil and gas sector.
The Indonesia Automation and Control System Market is moderately competitive and consists of several major players. In terms of market share, few of the major players currently dominate the market. These major players with a prominent share in the market are focusing on expanding their customer base across numerous countries. Moreover, the market is expected to witness a major shift, on account of increasing technological penetration and demand for oil and gas.
- June 2019 - Rockwell Automation, opened a new 8,000 square-foot Electric Vehicle (EV) Innovation Centre at 111 North Market Street in San Jose, California, within its Information Solutions development facility. The center will provide live manufacturing demonstrations, hands-on trials utilizing new technology and events showcasing collaboration with industry experts and Rockwell Automation partners.
- March 2019 - Yokogawa Electric Corporation announced that it established a subsidiary in Norway to engage in the sale of control products and provision of related services. Through the establishment of Yokogawa Norge and the creation of synergy with Yokogawa operations in Aberdeen, Scotland, Yokogawa will be able to solidify its sales and service organization in Norway and accelerate growth not only in existing markets but also in the renewable energy, pharmaceutical, and food industries.
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