Evolution of the Power Tools Industry- Market Size and Growth rate

The global power tools market size is estimated to be USD 34.3 billion in 2021 and projected to reach USD 45.2 billion by 2026, at a CAGR of 5.7%.

The growth of the power tools market is being driven by factors such as the increasing demand for electric fastening tools in the industrial environment and the rising construction industry in the emerging economies. Moreover, the development of smart and connected power tools as well as increasing adoption of fastening tools in wind energy industry is expected to drive the demand for power tools in the near future.

DRIVERS: Growing construction industry in emerging economies

Rising demand from the construction industry due to advanced infrastructural developments propels the sales of power tools. Power tools are adopted in the construction industry because these tools offer increased efficiency and accuracy, along with enhanced safety of the workforce. The growth of the construction industry boosts the demand for power tools, which leads to advanced infrastructural developments. Power tools such as drills and hammers are widely used in the construction industry. The construction industry is expected to witness significant growth in emerging countries such as India and China due to strong government support and rising income levels, thereby driving the growth of the power tools market.

RESTRAINT: Fluctuations in raw material prices

Power tools are manufactured using resins, ferrous and non-ferrous metals such as steel, zinc, copper, brass, aluminum, and nickel. Power tools also include other components such as batteries, motors, and electronic components. Power tool manufacturers are largely dependent on the supply of raw materials. Fluctuating costs of raw materials, component parts, or finished goods could result in manufacturing interruptions, delays, inefficiencies, or an inability to market products. Raw materials required for power tools are procured globally, and generally available from multiple suppliers at competitive prices.

OPPORTUNITIES: Development of smart and connected power tools

With the advent of IoT and the adoption of smart connected systems in assembly line operations, each equipment within the plant is getting connected. Advancements in technologies and the adoption of smart manufacturing practices lead to innovation of smart and connected tools. Leading tool manufacturers are focusing on the production of smart and connected power tools. For instance, Milwaukee Tool Corporation (Brand of Techtronic Industries) launched ONE-KEY, the digital platform for tools and equipment. This cloud-based platform allows a user to customize torque and speed settings for applications at hand.

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CHALLENGES: Declining sales of commercial vehicles due to COVID-19

Power tools are used in automobile manufacturing as well as servicing plants for several applications, such as drilling, fastening, tightening, and polishing. In the automotive industry, power tools are primarily used for installing brakes and seats in an automobile and detecting problems, such as faulty parts, on the assembly line at an early stage, thereby eliminating production errors. COVID-19 has severely impacted automotive companies, affecting manufacturing hubs in India, China, Italy, Germany, Spain, and the US. These countries have announced the complete or partial lockdown of manufacturing units, apart from assembly plants.

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