Historical data illustrates the effect of the global recession on the PLM market, with spending dipping sharply in 2009. One interesting aspect of this market is that, while people the world over talk about the lingering effects of that recession, it has not shown up in the PLM market results.
Based on data from annual CIMdata surveys, in 2010 the PLM market vastly exceeded CIMdata’s forecast, growing back to almost pre-recession levels.
The 2011 results were even more impressive, with the market growing more than 15.1 per cent, despite concerns about European debt restructuring and “fiscal cliffs” in the United States.
CIMdata estimates the comprehensive PLM market will grow to £31.2 billion in 2016, with a compound annual growth rate (CAGR) of 10.6 per cent. Companies around the world that develop, manufacture, and support complex products rely on PLM strategies and software solutions to power their product and process development.
PLM investments will increase as firms in emerging markets supply their domestic consumers with more complex manufactured products
The UK, US, Germany and France have major investments in PLM solutions. The emerging markets in Russia, Brazil, Africa and the Middle East are just starting their PLM journeys. CIMdata expects that PLM investments will increase as firms in emerging markets supply their domestic consumers with more complex manufactured products, and also begin to supply more complex subsystems and products for export.
Which industries rely most on PLM solutions? The data shows the largest investments are in the high-tech industries; together they total more than a third of the global PLM market. Another third of the expenditures comes from automotive and other transportation along with aerospace and defence (A&D); all were early adopters of PLM and continue to invest steadily.
Mechanical machinery, which supplies parts, assemblies and subsystems to these other industries, invested nearly £2.3 billion in PLM in 2011. The balance is from more design-focused industries that are just beginning to see the value in collaborative Product Definition management (cPDm), and simulation and analysis (S&A).
Where do we expect the PLM market to go? With software adding more and more value to manufactured products, companies will need to invest more in cPDm and tools like application lifecycle management (ALM) to manage product complexity. This will also drive investment in systems engineering, long used in automotive and A&D, to help companies develop complex products while optimising time, cost and quality.
Changing demographics and widespread internet use have altered the expectations of software users. PLM solution providers are scrambling to make their offerings easier to use and accessible on the cloud. Smartphones and other mobile devices are also creating an “always on, always connected” expectation that is just now emerging in the PLM market.
Given these changes, our market growth expectations may be too conservative. Only time will tell.
MARKET SEGMENTS
Tools and software
CIMdata defines the three PLM market segments as:
01 Tools, including mechanical computer-aided design (MCAD), computer-aided machining (CAM), simulation and analysis (S&A), electronic design automation (EDA), and architecture, engineering and construction (AEC). 2011 EDA spending topped £3.8 billion and MCAD exceeded £3.4 billion
02 collaborative Product Definition management (cPDm), the data and process management engine at the core of most companies’ PLM strategies. 2011 cPDm segment software and services were nearly £6.3 billion
03 Digital manufacturing – solutions used to help plan and simulate complex manufacturing processes.
