COVID-19 IMPACT SURVEY MAY 2020
With the manufacturing industry expected to be severely impacted by the virus-led recession, it is a rough weather forecast for Industrial Fasteners in the immediate to short-term period. The market will however grow in the post crisis period to reach a projected global market size of US$92. 6 billion by 2027. An indication of the grim state of affairs is the fact that global manufacturing PMI is already declining and will fall to an estimated all-time low of 35. 4 points in 2020 as compared to 53. 8 in 2019. This indicates severe contraction of manufacturing activity including new orders, production, employment, supplier deliveries, inventories, customers' inventories, commodity prices, order backlog, new export orders, and imports. Business investment confidence is tumbling amidst poor demand, falling profits, liquidity crunch and a reeling global economy. The US economy will shrink by -5. 9% while the Chinese economy will fall to a devastating 1. 2%. As aerospace & automotive industries, the two largest end-use markets bite the dust, industrial fasteners will feel the pain.
The importance of fasteners can be put into perspective by the fact that these tiny components comprising screws, nuts, bolts, pins and hinges, play a big role in providing support and mobility to equipment and machines. Securing essential joints is vital and fastener failure and breakage can result in machine and structural failure and damage to property and life. After this period of hiatus, growth trends in the market during the pre-COVID-19 period will gradually re-emergence as the economy begins to normalize. These trends will include increasing use of novel threaded and plastic fasteners; technology innovations in fastener forms and functions; rising wave of miniaturization drives demand for micro fasteners and miniature fasteners in myriad types and styles; popularity of miniature clinch fasteners with the ability to offer strong, permanent and reusable fastener solutions in applications utilizing “ultra-thin” metal sheets; focus on light weighting in the automotive and aerospace sectors and the ensuing interest in plastic fasteners; increased investments in industrial automation, motion control & robotics; rise of innovative fastener materials as alternatives to traditional all-metal fasteners and launch of hybrid fasteners featuring a blend of metal and injection-molded plastic elements; popularity of titanium fasteners in the aerospace sector. R&D investments in fastener technology will recover steadily supported by the evolving needs of new generation products and need for new assembly line solutions. Higher commercial value of features such as component disassembly in end-products will help replace traditional joining methods such as adhesives, rivets, and welding with fasteners. Asia-Pacific including China is a major market led by factors such as rising public sector investments in defense, infrastructure and aerospace in countries such as China, Malaysia, South Korea and India; growing foreign direct investments in the manufacturing sector in key Asian economies; and rise of the region as the global production hub of electrical and electronic components, automobiles and industrial machinery.