Advanced manufacturing is the latest innovation in industrial production. It transforms and enhances manufacturing by blending cutting-edge technologies with innovative methodologies to craft superior products, processes, and business models. In the ever-evolving industrial landscape, advanced manufacturing is key to remaining competitive, including in key clean industries, and critical to the EU’s economic security and industrial resilience.

A new JRC study offers a first comprehensive overview of the advanced manufacturing industry in the EU. It sets out a quantifiable framework that can support policymakers in establishing metrics and benchmarks, and monitoring industrial policy objectives. It presents an overview of the key advanced technologies applied to manufacturing processes, as well as a comparative analysis of the EU’s position with respect to foreign competitors, such as China and the US.

As shown in our preliminary study, the global advanced manufacturing industry is highly concentrated. 72% of firms deploying advanced manufacturing are located in China, the US and the EU.

While the EU saw a significant increase in the number of firms engaged in advanced manufacturing, particularly in Germany, Spain, France, and Italy, China remains the global leader. It hosts 45% of firms engaging in advanced manufacturing and has the highest growth rate (+570% firms in advanced manufacturing between 2009 and 2022). In addition, China’s advanced manufacturing industry tends to be more innovative. 66% of Chinese firms have filed at least one advanced manufacturing patent between 2009 and 2023, compared to 30% of firms in the EU and 20% in the US.

Despite China's dominance, the EU showcases its dedication to innovation by filing 18,000 patent applications in advanced manufacturing between 2009 and 2023. This commitment is a crucial step towards enhanced competitiveness and economic security.

Looking into market structure, the study shows that, across regions, the advanced manufacturing industry is mainly composed of small firms, except in China where larger firms are highly concentrated.

In the EU, small firms are dominant. Historical data shows that the EU was an attractive market for startups until 2019, with the number of European startups engaging in advanced manufacturing growing faster than elsewhere in the world. However, this does not necessarily translate into a competitive advantage. When looking at revenues, data shows that the European industry, in which SMEs play an important role, might not be as competitive against Chinese and US industries.

These results suggest that Europe should scale up its medium-sized firms into larger firms to become increasingly competitive internationally, building a stronger and more resilient industrial foundation.

The JRC study offers an innovative perspective on Europe’s competitive position by analysing industrial ecosystems - networks of interconnected firms and actors within shared value chains and markets. This approach can help design better policies for the EU’s industrial competitiveness and help suggest in which industrial ecosystems there is still untapped potential.

Results show that two manufacturing-oriented ecosystems dominate the global advanced manufacturing industry: electronics and energy-intensive industries. When looking at the EU’s manufacturing-oriented ecosystems, 3D Printing, Robotics, Dynamic Data, AI, and Power Electronics are the most frequently encountered technologies. Some patterns also emerge, for instance, 3D printing technologies are particularly relevant in aerospace, defence, and energy-intensive industries, whereas Power Electronics dominates the electronics ecosystem.

Furthermore, the results show that China once again dominates the competitive landscape, leading in five manufacturing-oriented ecosystems, mostly due to its large number of advanced manufacturing-related patents. These findings underscore the importance of intellectual property and innovation in shaping competitive landscapes.

Policy implications and a way forward

This study provides a critical assessment of the advanced manufacturing industry in Europe, offering insights into the EU’s competitive position and potential areas for policy action. The findings highlight the importance of advanced manufacturing for the EU’s industrial competitiveness and the need for targeted policies, strategic investments, and international collaboration to foster the diffusion and adoption of these technologies. This is crucial for the EU to strengthen its position in the global advanced manufacturing industry, and to enhance the competitiveness of its manufacturing sector.

The study serves as a call to action for the EU to seize the opportunities presented by advanced manufacturing and shape its industrial future in the post-pandemic era.

This latest advanced manufacturing study aims to support the European Industrial strategy. It aims to enhance the EU’s competitiveness, innovation and industrial sustainability, and builds on the EU Green Deal and Digital Strategy.

This report is part of the advanced manufacturing study, which is the result of a collaboration between the JRC’s Digital Economy Unit and the Digital Transformation of Industry Unit in the Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs (DG GROW), in collaboration with the Industrial Forum.

To complement the study, an online tool is now available to facilitate a more immediate and user-friendly exploration of the advanced manufacturing industry.

JRC study: Strategic Insights into the EU's Advanced Manufacturing Industry: Trends and Comparative Analysis (europa.eu)

Policy Brief: ADVANCED MANUFACTURING - DGTES applied to advanced manufacturing and its contributions to industrial ecosystems (europa.eu)

Dashboard to explore the advanced manufacturing industry