Market Trends of South Korea Automation And Industrial Control Industry
Semiconductor and Electronics to Hold Major Market Share
- The production of semiconductors is a significant economic industry in South Korea, with a market share of 18%. According to the National Bureau of Asian Research, South Korea also plays a crucial role as a manufacturer of fabless semiconductor companies. Samsung Electronics is the second-largest manufacturer globally after TSMC. The government reports that semiconductors are South Korea's top export, accounting for approximately 18.9% of all exports in 2022, with exports representing 42% of GDP.
- According to Semiconductor Equipment and Materials International, South Korea spent 19.94 billion USD in 2023,Such production capabilities and robotic installation activities are expected to bolster the market demand and automation technologies in the sector.
- As per the National Bureau of Asian Research, South Korea's GDP comprises 42% of exports, with semiconductors being the primary export item, contributing to almost 18.9% of total exports in 2022. The Korean administration prioritizes smart manufacturing and intends to establish 30,000 fully automated manufacturing firms by 2025, utilizing cutting-edge automation, data exchange, and IoT technologies. Such government initiatives in adopting automation technologies in the region are expected to drive the demand for the market.
- Several regional companies are constantly establishing strategic investments in building innovative manufacturing facilities to boost the region's semiconductor production capabilities. With the rising government initiatives to establish automated facilities, such investments are expected to drive the market significantly.
- Korean conglomerates are expediting the implementation of manufacturing automation solutions to enhance productivity, profitability, and cost reduction throughout the supply chain. The Korean government is encouraging businesses to embrace the digitalization of manufacturing and has identified four key themes: intelligence, services, sustainability, and platform. Due to this, various companies are adopting automation technologies and creating a positive outlook for the market.
Understand The Key Trends Shaping This Market
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Automotive Industry to be the Fastest Growing End User
- The South Korean automotive industry is one of the major global markets for vehicle sales and production of passenger cars. It currently contributes more than 10% of all manufacturing output in the country and is experiencing growth owing to significant investments. The industry is dominated by major automakers such as the Hyundai Motor Group, which owns Hyundai, Kia, and Genesis. As a result, South Korea wields significant influence in driving automation technologies in its Automotive industry.
- According to KAMA, In 2022, South Korea exported approximately 2.3 million units of vehicles, comprising passenger cars and commercial vehicles, representing a 15% increase from the previous year's 2.04 million units. In addition, In 2022, around 3.76 million units of vehicles were manufactured in South Korea. Kia Motors produced the highest number of vehicles, accounting for 39.4% of automobile sales in South Korea. These impressive manufacturing and sales capabilities are anticipated to stimulate the implementation of automation technologies in production facilities.
- Automobile manufacturers like Hyundai and General Motors Korea collaborate directly with additive manufacturers on the technology's application. Virtual and augmented reality also addresses manufacturing difficulties, such as machine failure, occupational injuries, and technical shutdown. Like many other industries, the auto industry wants to make the most of Industry 4.0, where "connected" machines communicate with one another and human operators to deliver workplace safety and productivity benefits. As a result, the rising need for automation in the vehicle industry affects automakers' attitudes about worker safety, resulting in a spike in the studied market.
- As of May 2023, electric vehicles (EVs) represented approximately 1.8% of the South Korean automobile market, as the Ministry of Land, Infrastructure and Transport reported. The government of South Korea has set a target to raise the proportion of electric and hydrogen vehicles in new vehicle sales to 33% by 2030. Furthermore, KAMA has stated that in 2022, domestic manufacturers sold approximately 123.7 thousand electric vehicles in South Korea, compared to 74 thousand units in 2021. Such developments in the EV sector will create significant opportunities for the vendor to invest in manufacturing facilities, thereby driving the market.
- Furthermore, according to the Ministry of Transport, South Korea is planning to establish safety regulations and an insurance framework for deploying Level 4 autonomous vehicles within the country by 2024. Additionally, in October 2022, Motional entered into a decade-long agreement to provide Hyundai's IONIQ 5 autonomous vehicles (self-driving robot taxis) to Uber Technologies Inc., a ride-hailing company based in the United States. Such activities are expected to drive the market further.
