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An inquiry by the European Association of the Machine Tool Industries (CECIMO) shows that data-driven business models are high on the agenda of machine tool builders in Europe. Contributed by CECIMO
The annual CECIMO general assembly that took place in recently identified two trends that machine tool manufacturers are placing important emphasis on in the future:
- Using data-driven business models.
- Building a hybrid skills pipeline that merges ICT (information and communications technology) and production technologies.
New Business Models By Machine Tool Builders
A greater certainty on the right to access different types of data generated by machines would be a necessity for machine tool builders to tap into new business opportunities; During its general assembly meetings, the organisation conducted an inquiry with chief executive officers and owners of European machine tool companies and shared their findings.
For most of the companies that participated, data-driven business models will be most prioritised over the next 10 years, compared to other business models such as services based on in-house knowledge, product-as-a-service, and platform-based services. Majority of the machine tool builders find that understanding customers’ digital needs and cooperating with them are essential to develop new business models.
Hiring A Skilled Workforce
Half of the machine tool builders questioned said that launching new education programmes in Europe that merge ICT and production technologies is the most important policy pillar to underpin new business models, followed by future-proof and technology neutral regulations.
“Machine tool builders are increasingly facing difficulty in finding the workforce possessing knowledge and skills needed to apply digital solutions in the field of advanced manufacturing. In order to tackle this pressing challenge, public authorities at national and regional levels as well as education providers together with the industry should invest more in the design and delivery of a new education approach merging various disciplines including software programming and production technologies,” said Filip Geerts, CECIMO director general.
Existing European Union (EU) regulations on data has mainly focused on personal information protection and does not address the complexities of manufacturers in B2B sectors. Currently, access to raw data generated by machines is generally defined by contracts between suppliers and users. Nevertheless, working with bilateral contracts in the future may be challenging as the amount and type of data collected are increasing and data-driven business models are likely to grow through industrial data platforms and networks.
Under this light, future-proof and technology-neutral key principles and greater certainty on the right to access different types of data generated by machines along the value chain are a necessity for industrial actors to tap into new business opportunities. For a competitive and data-driven industrial base to happen, machine tool builders will need access to data derived from machines used by various customers along the value chain.
“Clear benefits of this access include increased productivity, safety, energy and resource-efficiency for the entire European industry, taking into account the fact that machine tools are a key enabler of the production of other industrial equipment and machinery across various sectors,” said Luigi Galdabini, CECIMO president.
Economic Situation And Outlook
In spite of the global economy’s weakening growth and high levels of uncertainty in international trade relations, the European machine tool industry continues to show signs of growth. European machine tool production increased its global market share in 2016 to exceed 40 percent. Investment in modern manufacturing equipment remains relatively low, but recovery of economic activity is visible and business confidence in Europe may support additional growth in investments.
All economic indicators from the destination markets point to a stable growth momentum. The European machine tool industry is estimated to export an amount of 18.7 billion euros (US$19.8 million). Exports to Asia are falling in line with local economic developments.
Exports to Russia are heavily impacted (falling 30 percent year-on-year) by the EU trade sanctions. Exports to the Americas are increasing due to investment into new or upgraded automotive plants in the US and Mexico. Domestic European consumption is supported by a resilient investment climate in Europe with ongoing investments into more efficient production equipment.
Quick Look At Europe’s Machine Tool Industry
European machine tool production grew to 24.2 billion euros in 2016.
Global market share exceeded 40 percent in 2016.
Exports will remain stable this year at 18.7 billion euros (US$19.8 million).