Digital Twin spending will surpass $27.6 billion in 2040

Independent research firm Verdantix has predicted that the global digital twin industry will grow from $787 million in 2020 to $27.6 billion by 2040. This works out at an annual growth rate of 19.5% and is being driven by operational excellence strategies, enterprise risk initiatives and cost-cutting programmes. A range of companies are poised to benefit from the growth including big names like Autodesk, Bentley Systems and Siemens.

Verdantix industry analyst, Sebastian Winter, said that concerns surrounding the COVID-19 pandemic have accelerated the implementation of remote working solutions. Such working is aided by the use of digital twins and can help with business continuity and safety of operations. This includes remote communication between managers and frontline workers by the use of 3D simulations and giving workers greater access to granular asset and equipment data.

The full report, titled ‘Digital Twins for Industrial Facilities 2020-2040’, assists its readers in taking advantage of the market opportunity, those of whom range from solution providers, systems integration services firms and financial investors. The model helps to break down market size and forecasts trends specified by asset classes and geographic regions.

In 2020, infrastructure accounts for 17% of the market with a spend of around $130 million, whilst onshore oil and gas production accounts for 12% at $91 million. Manufacturing plants aim to reach $85 million and power generation just shy of half of that total coming in at $42 million.

The 20-year Compound Annual Growth Rate (CAGR) of 19.5% is reflective of two periods of growth. Winter continued to add that the next 10 years will see the market reach $6.5 billion, assuming it follows current trends. The market is expected to ‘explode’ in the 10-year period covering 2030-2040 reaching a total of $27.6 billion in 2040, this is due to the widespread adoption of the underlying technologies required for more sophisticated digital twins. Enterprise asset management software, APM software and IoT platforms are expected to gather extreme pace during this period. This will significantly drive an increase in spend per customer that will see us enter a second era of growth for the market.