Deloitte Shares 2025 Manufacturing Predictions & Outlook

It's November, which means we're nearing December, which means Christmas is close on the horizon. 

With preparations in full swing, consumer goods manufacturers are moving as they do each year to focus on supply and demand inventory. 

Holiday inventory shortages can wreak havoc on retailers, so ensuring a steady and consistent product supply is critical. 

This is especially true as according to Deloitte holiday spending intentions are set to rise even higher this year. 

Respondents in the consultancy's 'Holiday Retail Sales Consumer Survey' expected to spend US$1,778th this holiday season, an 8% increase from the previous year. 

To ensure product supply, manufacturers need to strengthen their operations and secure their supply chains. 

One way they can do this is by looking ahead to the future. 

This doesn't just mean predicting and analysing incoming political and economic changes. 

It also means manufacturers picturing the future of the sector itself, to place themselves ahead of the competition.

Luckily, Deloitte has consolidated its expertise in this area too. 

The consultancy's '2025 Manufacturing Outlook' lays out five big predictions for next year, giving manufacturers critical insights when planning ahead. 

Less proofs of concept, more scaled solutions

Manufacturers will shift from testing Gen AI scenarios in 2024 to implementing scalable, value-driven applications in 2025.

The focus will be on routine Gen AI applications like maintenance and repair, with gradual adoption of more complex areas such as product development and design.

Businesses will also navigate governance and ethical AI challenges as they evolve their strategies.

Manufacturing is entering its Gen-Z “era”

The new generation sees manufacturing as outdated and seeks fulfilling, technology-driven careers.

Retaining talent remains crucial, but manufacturers must prepare for Gen-Z’s dynamic expectations by adopting technologies that enhance training, streamline operations and simplify daily tasks.

Software revolutionising manufacturing

Like the automotive sector, software will redefine manufacturing by addressing flexibility and agility challenges.

Automation, robotics and software-driven processes will reshape production lines.

This transformation will accelerate in 2025, especially with greenfield projects in the U.S. spurred by initiatives like the CHIPS Act.

Prioritising tech wellness as an innovation foundation

Revisiting industrial data and Manufacturing Execution Systems (MES) is essential for scaling smart operations.

Many organisations face digital readiness challenges due to fragmented management of these systems.

By 2025, a cohesive technology strategy will be critical to unlocking the full potential of AI, GenAI, metaverse/digital simulation technologies and more.

Simulation for success

Simulation will play a larger role in manufacturing over the next 12 months. Digital simulation tools will enhance employee training, safety, efficiency and process optimisation.

While scaling these technologies is complex, targeted investments in high-ROI use cases—such as production line simulation and business scenario modeling—are expected to have a significant impact on the industry by 2025.

Manufacturers seeking to better prepare for 2025 can study this expert list by Deloitte. 

They can also check out Manufacturing Digital's list of predictions for next year too.

Below are the trends Deloitte foresees will take hold in the manufacturing sector for 2025, many of which you can read about in the 2025 Manufacturing Outlook.

• Less proofs of concept, more scaled solutions - Manufacturers need to move the needle on GenAI investments: While 2024 was the year to test GenAI scenarios, 2025 will have manufacturers shifting gears as the C-Suite pushes for more concrete, value-pay applications rather than endless trials. As GenAI evolves and businesses wrestle with governance and ethical AI challenges, expect to see manufacturers channel their resources into routine GenAI applications like maintenance and repair while beginning to move to more complex, robust concepts, like product development and design.

• Manufacturing is stepping into its Gen-Z “era”: While the sector has evolved dramatically since the Industrial Revolution, the new generation often still sees it as grimy and outdated. Gen-Z craves more from their careers than the traditional manufacturing roles – the days of loyalty to one company for decades are fading away. Although retaining talent remains crucial, manufacturers will need to prepare for the inevitable waves of change brought by this dynamic generation. Embracing technology that streamlines operations, enhances training and simplifies daily tasks will help bridge the generational divide and keep the wheels of industry turning smoothly.

• Software is set to revolutionise manufacturing: Just as it has in the automotive sector, software is poised to redefine the future of manufacturing, addressing the limitations in flexibility and agility inherent in traditional methods. Companies will start rethinking and redesigning their production lines, paving the way for software-driven manufacturing processes like automation and robotics. By 2025, this shift will become evident, especially with new greenfield projects breaking ground in the U.S., as manufacturers move operations closer to home, spurred by legislative actions like the CHIPS Act.

• Prioritising tech wellness as the foundation for innovation: As manufacturers continue making strides towards “smart” operations, it’s time to revisit two critical pillars: industrial data and manufacturing execution systems (MES). While delving into these essentials may not be the most glamorous of trends, it's crucial for mastering new technologies at scale. Fragmented management of both data and MES has left many organisations with varying degrees of digital readiness. Come 2025, a cohesive technology strategy will be indispensable. This robust foundation will empower manufacturers to harness the potential of AI, GenAI, metaverse/digital simulation technologies and more, driving efficiency and transforming possibilities into reality.

• Simulation for success: Over the next 12 months, the use of simulation in the manufacturing industry is expected to increase. With potential business disruptions, the need to control costs and the rise of AI, digital simulation will become a valuable tool. Digital simulation provides organisations with many advantages, including enhanced employee training, improved safety, increased efficiencies and optimised operations through process and business simulation scenarios. However, implementing these technologies at scale can be complex. By investing in digital foundations for smart operations and focusing on high-ROI use cases, manufacturers can refine their strategies. More targeted applications such as casual AI, production line simulation, process simulation and business scenario simulation are anticipated to impact the industry significantly.

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