According to the Market Statsville Group (MSG), the global cutting tools market size is expected to grow from USD 35,105.97 million in 2022 to USD 51,253.66 million by 2033, growing at a CAGR of 3.5% from 2023 to 2033. The emphasis on achieving higher productivity and reducing downtime in the any industrial sector will drive the market growth. Emerging countries like China, India, Argentina, Poland, Brazil, and others has become a hub for the manufacturing sector. The Asia-Pacific region is one of the largest exporters of goods & services considering the global scenario. The population is also enormous in the region, and the number increasing at a steady rate. To support this, the manufacturing sector must maintain the growing requirement for products and services. Hence, the smart technology is increasingly incorporated in manufacturing operations, since it helps companies to increase their productivity, maximize their resources, and help them to innovate products.
Moreover, the increasing number of smart factories in industrial sector and growing spending by manufacturers in new tools to maintain product quality and accurate measurements is expected to drive the adoption of automatic tools. On the other hand, advent of advancements along with rise in adoption of automatic tools will augment the growth of cutting tools market over the forecasting period.
Inserts or replaceable tips are frequently used in the design of cutting instruments (tipped tools). The cutting edge in these is a distinct piece of material that is brazed, welded, or fastened to the tool body. A common material for tips is cemented carbide, polycrystalline diamond, and cubic boron nitride. Cutting tools use tool inserts include milling cutters (endmills, fly cutters), tool bits, and saw blade. A cutting tool or cutter is any tool that is used to remove some material from the workpiece to give it a certain size, shape, and accuracy. Milling and drilling tools are often multipoint cutting tools. It is a body having teeth or cutting edges on it. Grinding tools are also multipoint tools. Each grain of abrasive functions as a microscopic single point cutting edge (although of high negative rake angle), and shears a tiny chip.
The novel COVID-19 has seen a significant impact on the cutting tools market. The epidemic has thrown up an unprecedented crisis for the nations and businesses across the world. The spread of coronavirus across the globe has resulted in lockdowns in the countries, which has compelled people to stay at home and forced companies to allow their employees to work at home to contain the spread of the epidemic. Every element has been affected, from raw material supplier to manufacturer and other end users. Factories and production facility have been forced to remain closed due to lockdown and social distancing measures, resulting in a sharp drop in the sales of cutting tools market on a global level. Moreover, it further affects the business of its end-use industries who opt for such tools because of its versatile benefits, which may pose a negative influence on the market growth, amidst the pandemic.
Due to lockdown or limited production, the disruption in the supply chain of materials have affected cutting tool manufacturers due to shortages from China, as most of the materials were imported from China. Additionally, the other countries were looking for supply, which increases the demand, and lead large suppliers to dominate the market prioritized big companies to SMEs at the time of recovery.
The increasing demand for power tools in DIY activities and households is driving the growth of the cutting tools market. The need for cutting tools is rising by the construction activities in the homes and offices, which led to the demand for power cutting tools in DIY activities. The dynamics of the market of DIY power tools have been increasingly affected by changing consumer preferences. The growing popularity of DIY home projects in developed nations has attracted attention to DIY cutting tools. Homeowners have used these instruments extensively as part of the renovation, particularly with furniture. Manufacturers have also begun to use strategies that will allow them to strengthen and expand their customer relationships. Besides, seasonal sales have been used by several companies to entice potential customers and users. To boost sales, companies in the DIY power-cutting tool industry are launching frequent marketing campaigns. Customer satisfaction has become more important in the DIY power-cutting tool market. A growing number of individuals in developing nations are renovating their homes, which has resulted in a transfer of players to emerging markets. In this regard, e-commerce has created a new approach to reaching out to prospects.
The demand for cordless electric power tools will exceed that of conventional plug-in models. Brushless motors, which are more efficient than brushed motors, are being used by manufacturers to bring more powerful cordless electric cutting tools to the market. Imports of lower-cost power cutting tools will become more competitive, especially among more basic products. Thus, the cutting tools with high power available in the market and that use are rising in the construction industry is driving the market growth during the forecast period.
Several companies are interested in automating their manufacturing processes. However, this comes at a high cost in terms of machine purchase, training, and maintenance. In addition, changing market prices are one of the critical factors affecting market growth. During the COVID-19 pandemic, businesses struggled to adapt to shifting demands. Companies are currently experiencing a severe financial constraint, and as a result, they have been forced to downsize and cut their workforce. Based on the severity of the present economic situation as a result of the pandemic, this is likely to impact company revenue in the coming years.
For instance, a shop trying to save money on its cutting tool purchases is likely to consider two factors: tool life and tool price. The cost of the cutting-edge tool is only 3% of the overall cost. It applies them to three alternative expense strategies. The comparison estimates labor cost $10 per component. Thus the 3% for cutting tools is 30 cents, the 17% for workpiece materials is $1.70, and so on. The cost of cutting tools is included in the variable costs. Cutting tools (3 %) and Workpiece materials (17%) are additional costs incurred exclusively during manufacturing. Thus, the high cost associated with the cutting tools is restraining the market growth during the forecast period
The governments are focusing on the launches of the various projects to develop the industry; among the various projects, Industry 4.0 is to create opportunities for the growth of the cutting tools market during the forecast period. The convergence of Industry 4.0 with cutting tools is a significant factor that promises a profusion of trade and adoption prospects in the cutting tools industry. Sandvik Coromant, a manufacturer of cutting tool systems, has unveiled its ‘CoroPlus' suite of Industrial Internet of Things (IIOT) solutions, assisting industrialists in preparation for Industry 4.0. According to the company, this idea combined with cutting tools focuses on improving output control and efficiency while reducing costs through a network of connected machining and access to production data and expert knowledge.
Apart from this, countries are investing in adopting Industry 4.0, which is estimated to provide lucrative growth opportunities in the global power tools market. For instance, under the “Make in India” initiative, in 2019, the Indian Government launched an initiative SAMARTH Udhyog to create an ecosystem for the propagation of Industry 4.0 set of technologies in every Indian manufacturing by 2025 in MNC, large, small, or medium-scale Indian companies.
The study categorizes the cutting tools market based on type, and application area at the regional and global levels.
Based on the type, the market is divided into cemented carbide, high speed steel, ceramics, diamond and others. The cemented carbide segment is expected to dominate the market share in 2022 in the global cutting tools market. The cemented carbide segment currently dominates the market share in the cutting tools market. The development in manufacturing design and necessity to accomplish production efficacy is setting the base for manufacturer’s investigation of superior end products, therefore growing the demand for carbide tools. The cemented carbide tool is highly significant and extensively used in machining application owing to its significant features such as high speed, reduces cycle time, retains cutting edge at high machining temperature, exceptional wear resistance at cutting edge, long working life, and others.
The rising production demand to capitalize on the bourgeoning global requirements is enforcing industrialist to install advance tools to support efficient operations and dwell higher outputs in lesser time, thereby creating a lucrative growth opportunity for cutting tools.
Asia Pacific is expected to witness the largest market share by Region
Based on the regions, the global cutting tools market has been segmented across Europe, North America, the Middle East & Africa, Asia-Pacific, and South America. Asia Pacific is projected to account for the highest market share in 2022. The industry in Asia Pacific accounted for the largest market share in 2020. This growth is mainly due to the participation of leading players offering advanced technologies and services to all sectors of the country. In addition, the growing adoption of automation and rising automotive industry in the region is expected to boost demand for cutting tools over the forecast period. Asia Pacific is likely to rise at the fastest CAGR of almost the forecast era. Countries like India and China are making rapid progress towards automation of all industries, and are the most populated and manufacturing hub for various industrial sector which are projected to increase the demand for cutting tools in the region.
The cutting tools market is a significant competitor, and extremely cutthroat in the sector are using strategies including product launches, partnerships, acquisitions, agreements, and growth to enhance their market positions. Most sector businesses focus on increasing their operations worldwide and cultivating long-lasting partnerships.
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