Augmented Reality & Virtual Reality In Manufacturing Market Size, Share & Trends Analysis Report By Component (Hardware, Software, Services), By Technology, By Device, By Application, By Region, And Segment Forecasts, 2022 - 2030

Report Overview

The global augmented reality & virtual reality in manufacturing market size was valued at USD 5.57 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 29.3% from 2022 to 2030. Augmented reality (AR) and virtual reality (VR) are highly compatible technologies that provide an immersive 360-degree content view in a highly simulative environment and are driven by actionable analytical insights. There has been a rise in demand for AR and VR devices among manufacturers for simulative applications. Furthermore, the rise in applications of AR and VR for manufacturing plant improvisation and workforce training catalyzes the industry growth.

Advancements in augmented reality and virtual reality technologies for capturing images and sound have led to their adoption during the last few years. Further, the availability of various electronic products such as tablets, headsets, and other smart devices compatible with AR and VR technologies has led to a significant increase in market opportunities. For instance, in January 2022, Microsoft Corporation Inc. launched its mixed reality headset HoloLens 2 in India. The headset has a modern time-of-flight depth sensor, along with in-built artificial intelligence and semantic comprehension, which allows users to handle holograms in a more realistic form.

The rise in the application of industrial robots in manufacturing drives the demand for AR and VR technologies. Inducing AR in manufacturing and production processes provides various capabilities, such as identifying an error and offering virtual support in real-time, all of which reduce production downtime. This is, in turn, creating demand for AR and VR technologies in the manufacturing process.

The adoption of AR and VR to eliminate physical trials assists organizations in cutting down R&D costs. Furthermore, VR solutions help reduce training costs and help organizations redistribute resources for enhanced outputs. This helped manufacturers during Covid-19 to address the problem related to the shortage of workforce, which also created a demand for AR and VR in the manufacturing industry.

Technological adoptions due to the onset of industrial revolution 4.0 have increased the penetration of augmented and virtual reality in manufacturing. The harmonious integration of VR, AR, and MR is expected to make several experiences more engaging and interactive. The narrowing supply-demand gap of raw materials and components between suppliers and manufacturers is expected to hoard the market with new AR, VR, and MR products. Hence, the availability of new products is expected to expand the market. 

Component Insights

The hardware segment accounted for the largest revenue share of over 55.0% in 2021 and is expected to continue dominating the market over the forecast period. The growing adoption of AR and VR devices across various industries contributes to segment growth. Technological developments, networking, and connectivity advancements are expected to fuel the market demand for augmented reality and virtual reality headsets over the forecasted period.

The services segment is expected to expand at the highest CAGR of 31.0% over the forecast period. The significant growth observed in the services segment is due to an increase in immersive technology-related consulting and service offerings such as maintenance, training, and security services, which will continue to grow in the forecast period. The services segment is a new market with many key augmented and virtual reality technology companies investing in service firms. For instance, in February 2022, ESI Group and CIMPA, a significant player in product lifecycle management consulting and services, collaborated to provide manufacturers with integrated VR solutions with existing product lifecycle management processes.

Technology Insights

The augmented reality (AR) technology segment accounted for the largest revenue share of over 70.0% in 2021. This growth is due to the preference for AR technology that enables manufacturers to access manual processes and automated data simultaneously. Further, the application of AR technology for production training, enhancing process efficiency, and well-being of employees fuels AR in manufacturing market growth. Furthermore, using AR for maintenance in manufacturing plants contributes to the industry growth.

The virtual reality technology segment is anticipated to expand at the highest CAGR of 32.3% from 2022 to 2030. This growth can be attributed to the widespread adoption of virtual reality and the rising popularity of industrial IoT, industrial robots, and smart factories that have offered a primary platform for VR applications in the manufacturing industry. The ability of VR to provide a 360-degree content view experience in a highly stimulating environment in modern production creates many opportunities for market growth.

Device Insights

The head-mounted display (HMD) segment accounted for the largest revenue share of over 60.0% in 2021. The increasing demand for head-mounted displays and smart glasses for industrial and enterprise applications is a key growth factor. The HMD segment is expected to maintain its dominance over the forecast period owing to the use of HMD devices for product enhancement.

The handheld devices segment is anticipated to expand at the highest CAGR of 30.3% from 2022 to 2030. The segment is projected to gain traction due to the emerging demand for high-quality immersive technology. Hand-held AR and VR devices allow users to freely enjoy technological advances while roaming without having to mount devices on their heads or sit next to any project or display terminal. The growing popularity and increase in user base numbers are expected to further drive the market demand.

Application Insights

The product design and development segment accounted for the largest revenue share of over 50.0% in 2021 and is expected to continue dominating the market over the forecast period. Manufacturers have increased market competition by using AR and VR technologies in product design and development applications. Therefore, the convenience of using AR and VR technologies for product design and development fuels the market growth.

The safety and training segment is expected to expand at a lucrative CAGR of 29.0% over the forecast period. The need for effective enterprise maintenance and repair tools across organizations is the driving force of the maintenance and repair segment. AR and VR in security and training have been gaining momentum due to the adoption of advanced technologies in training programs.

Regional Insights

North America accounted for the largest revenue share of over 35.0% in 2021 and is anticipated to witness growth over the forecast period. The U.S. held the largest share in the North American market. The surge in the penetration of industrial revolution 4.0 in the U.S. manufacturing market fosters the industry growth in the region.

Asia Pacific is predicted to emerge as the fastest-growing region over the forecast period with a CAGR of 33.1% from 2022 to 2030. Countries such as Japan and China held a major share in the Asia Pacific market in 2021, leveraging a large customer base. Further, the continued rollout of 5G networks in Asia Pacific is expected to catalyze the growth of augmented and virtual reality technology in the manufacturing sector.

Key Companies & Market Share Insights

Market players have adopted strategies such as product launches, product development, partnerships, strategic alliances, and acquisitions & mergers to advance technological developments despite the competition. For instance, in September 2021, Vuzix Corporation partnered with KTI Ingeniería SpA, a consulting company in digital transformation. The latter deployed Vuzix Corporation’s Smart Glasses across several Chilean companies, including Dior, Statkraft, Komatsu, CMPC, FCAB, SQM, and Molycorp. Some prominent players in the global augmented reality & virtual reality in manufacturing market include:

• Microsoft Corporation

• Google LLC

• Samsung Group

• Vuzix Corporation

• SkillReal

• Ediiie

• EON Realty, Inc.

• Kaon Interactive Inc.

• Worldviz, Inc.

• SoluLab

• ESI Group

Augmented Reality & Virtual Reality In Manufacturing Market Report Scope

Global Augmented Reality & Virtual Reality In Manufacturing Market Segmentation

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2018 to 2030. For the purpose of this study, Grand View Research has segmented the global augmented reality and virtual reality in manufacturing market report on the basis of component, technology, device, application, and region:

• Component Outlook (Revenue, USD Million, 2018 - 2030)

  • Hardware

  • Software

  • Services

• Technology Outlook (Revenue, USD Million, 2018 - 2030)

  • Augmented Reality

  • Virtual Reality

• Device Outlook (Revenue, USD Million, 2018 - 2030)

  • Head-mounted Display

  • Head-up Display

  • Handheld Devices

• Application Outlook (Revenue, USD Million, 2018 - 2030)

  • Product Design & Development

  • Safety & Training

  • Maintenance & Repair

• Regional Outlook (Revenue, USD Million, 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • U.K.

    • Germany

    • France

  • Asia Pacific

    • China

    • Japan

    • India

  • Latin America

    • Brazil

  • Middle East & Africa