The world is facing an economic crisis due to the sudden outbreak of the COVID-19 pandemic. The pandemic has affected the growth of the end-use industries. Major oil producers are running out of storage space for extracted oil, as the demand is on a declining trend. This has resulted in a massive gap between supply and demand. The energy & power, automotive & transportation, and aerospace & defense industries are also among the key end users of digital twin technology. These industries are also witnessing a declining demand due to the pandemic.
According to MarketsandMarkets, the global digital twin market size was valued at USD 3.1 billion in 2020 and is projected to reach USD 48.2 billion by 2026. It is expected to grow at a CAGR of 58% during the forecast period.
Major factors driving the growth of the digital twin marketare the increasing demand for digital twins in the healthcare and pharmaceutical industries due to the outbreak of COVID-19 pandemic, the changing face of maintenance, and growing adoption of digital twin solutions to cope up with the COVID-19 pandemic are the key factors driving the growth of the digital twin market.
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System digital twin expected to account for a larger share of the digital twinmarketby 2026. This growth can be attributed to the increasing use of digital twin for systems in various verticals. For example, in the aerospace & defense sector, NASA uses/implements digital twins to monitor its space stations and spacecraft to ensure better safety. In the automotive & transportation sector, a start-up, SWIM AI, uses digital twins for the traffic management system in California. Likewise, Tesla uses digital twins in the of manufacturing of its cars. COVID-19 has affected every aspect of the business, and the impact is visible on the usage type market for digital twin. New installations of product/process/systems have declined after the outbreak of the pandemic. It is expected that in the post-COVID-19 period, end users will extensively implement system/process digital twins to minimize future losses.
In terms of geographic coverage, the digital twinmarkethas been segmented into North America, Asia Pacific (APAC), Europe, and the Rest of the World (RoW).North America held the largest share of the global digital twinmarket in 2019. In recent years, the development of various software and deployment of automation solutions in the manufacturing industries has improved production lines and downstream operations. These developments have positively impacted the growth of the digital twin market in North America due to the high economic growth and a large presence of vendors offering digital twins. Moreover, the increased R&D in the field of the IoT and IIoT and increasing demand for efficient and cost-effective technologies for product manufacturing are also supporting the regional market growth.