Functional Safety Market

Report Overview

Functional Safety Market is anticipated to grow at a CAGR of 9.5% in the forecast period (2024-2034), with the market size valued at USD 5.7 billion in 2023 and projected to reach USD 15.5 billion by 2034.

Product Overview

Functional safety is an important part that ensure the reliability and safety of complex systems across industries like automotive, manufacturing, and energy. It includes taking necessary steps to detect and reduce potential risks, thus lowering the risk of damage to individuals and assets. Functional safety standards, such as ISO 26262 and IEC 61508, establish guidelines for the development and evaluation of safety-related systems and components. These standards define the criteria for the safety lifecycle, which includes design, operation, and maintenance. Furthermore, functional safety includes important aspects like hazard analysis, calculating the safety integrity level, and implementing safety-related control systems. Thus, as industries become increasingly automated and digital, the demand for functional safety solutions will encourage innovation and improvements in safety technologies.

Market Highlights

Functional Safety Market is expected to exhibit a CAGR of 9.5% during the forecast period, 2024-2034

Functional safety market is anticipated to reach USD 15.5 billion, growing at a CAGR of 9.5% during the forecast period, owing to strict regulations mandating safety standards across industries, which encourages the use of functional safety measures.  The increasing complexity and automation of industrial processes increase the need for safety measures to reduce these risks effectively. Moreover, growing awareness of workplace safety and the possible consequences of accidents is responsible for driving the demand for functional safety solutions. In addition, developments in sensor technology, along with software and communication help in improving the reliability of safety systems. Thus, the functional safety market is likely to grow due to the constant evolution of technology and focus on safety in many industries.  

Source: Fatpos Global

Functional Safety Market Segmentation

Safety Sensors are known to dominate the market due to their widespread usage in a variety of applications

Functional Safety Market based on Devices is segmented into Safety Sensors, Safety Controllers, Safety Switches, Programmable Safety Systems, Emergency Stop Devices, and Final Control Elements. The safety sensors segment is the leading device type as safety sensors serve as the primary detecting tools in safety instrumented systems and act as “eyes and ears" to recognize hazardous conditions such as high pressure or temperature. Safety sensors are in high demand due to their vast applications across various sectors and operational conditions. In addition, they serve as the basic layer of safety logic by providing vital data inputs to safety controllers, which allow for real-time analysis and activation of safety actions when dangers are discovered. Moreover, the availability of numerous safety sensor types, such as light curtains and temperature sensors, plays a major role in boosting the utility of safety sensors.

Direct sales channels are preferred by vendors and customers, creating a stronger market share

Functional Safety Market is categorized based on Sales Channels into Direct and Indirect. Direct Sales emerged as the dominant segment, due to the complexity of functional safety solutions that require better expertise and strong relationships between vendors and customers. Also, direct sales channels allow manufacturers to use salespeople with technical skills, which is critical for understanding the specific demands of customers. These fast interactions establish strong relationships, which allow for continuous support and training, that are essential for the long-term effectiveness of safety systems. Furthermore, the direct sales channel allows for close collaboration between engineers and customers, resulting in modified solutions that fit the application's requirements.

Source: Fatpos Global

Market Dynamics

Growth Drivers

Increasing Emphasis on Safety Regulations in Various Industries Is Expected to Promote Market Growth and Development

Growing emphasis on safety standards in many industries is a major growth driver of the functional safety industry. Governments across the world are establishing stronger safety laws, that require the use of safety-certified equipment and systems to reduce accidents and environmental damage. This governmental obligation forces businesses to invest in functional safety solutions to assure compliance. Furthermore, regulatory agencies have increased their emphasis on worker safety, thus highlighting the need for functioning safety systems to protect users from hazards associated with industrial processes and machinery. Therefore, compliance with safety standards and the need to improve worker safety have been driving the adoption of functional safety solutions across industries.

Growing Adoption of Automation and Complex Machinery has Raised the Need for Functional Safety Solutions

Rising adoption of automation and complex machinery across different industries serves as an important driver for the functional safety market. Automated systems and complex machinery inherently face higher risks since they operate at higher speeds, handle hazardous materials, and execute complicated tasks, which demands strict safety precautions to avoid mishaps. Moreover, as automation and machinery continue to evolve, integrating safety functions becomes extremely difficult. Corporations depend on automation and complicated machinery for efficient production, thus highlighting the need for functional safety systems to ensure consistent operations and avoid costly downtime that is caused by accidents or equipment breakdowns. 

Restraints

High Initial Investment Costs to Act as a Major Challenge in the Market

High initial investment costs present a significant restraint in the functional safety market as it primarily impacts the growth of the market through several avenues. Budgetary limitations for small and medium-sized enterprises, impact the adoption due to the high upfront costs. Additionally, focusing on short-term gains over safety considerations and lack of awareness about the importance of functional safety systems further worsen this challenge. These factors collectively impede market growth in sectors that have less mature safety cultures. Thus, addressing these barriers could involve government incentives and highlight long-term benefits to encourage the adoption of functional safety systems during the forecasted period.

Recent Developments

• In 2023, ABB Group launched a new series of safety relays- the ASI (Advanced Safety Integrator) series. These relays offer improved diagnostics, communication capabilities, and ease of use for safety applications. The Company continues to focus on integrating functional safety into its automation portfolio.
• In 2023, Emerson Electric, acquired National Instruments (NI). This acquisition strengthens Emerson's capabilities in industrial automation and data analytics, which can be leveraged for advanced functional safety solutions. They also introduced a new line of wireless safety transmitters providing real-time process data while meeting functional safety requirements.
• In 2023, Honeywell International Inc., launched the Experion PKS Safety Gateway. This gateway simplifies the integration of safety instrumented systems (SIS) with process control systems, enhancing overall safety management. They are actively focusing on functional safety solutions for specific industries like oil & gas and chemicals.
• In 2023, Omron Corporation, introduced the NX-HAD series of safety relays. These relays offer compact size and high performance for a wider range of safety applications.
• In 2023, Rockwell Automation, Inc. introduced the Allan-Bradey Guardmaster Electronic Disconnect Switches. These switches provide safe and reliable machine isolation for maintenance and service procedures.

Functional Safety Market

Key Players:

• ABB Group
• Emerson Electric Co.
• Schneider Electric SE
• Honeywell International Inc.
• Omron Corporation
• Siemens AG
• Rockwell Automation, Inc.
• General Electric Company
• Yokogawa Electric Corporation
• Mitsubishi Electric Corporation
• Pilz GmbH & Co. KG
• Balluff GmbH
• HIMA Paul Hildebrandt GmbH
• Pepperl+Fuchs GmbH
• B&R Industrial Automation GmbH
• Other Prominent Players (Company Overview, Business Strategy, Key Product Offerings, Financial Performance, Key Performance Indicators, Risk Analysis, Recent Development, Regional Presence, SWOT Analysis)

Regional Analysis

Functional Safety Market is segmented based on regional analysis into five major regions: North America, Latin America, Europe, Asia Pacific, and the Middle East and Africa. The Asia Pacific region is expected to dominate the market as China and India are expected to experience significant industrial growth during the forecasted period.  This results in a high demand for new factories, production lines, and process plants, which require functional safety systems to ensure work safety and regulatory compliance. In addition, safety regulations in these developing economies are pushing for the adoption of functional safety solutions across the Asia Pacific region.

Alternatively, North America has a well-established manufacturing base and places a strong emphasis on safety regulations. Companies in this region are likely to continue investing in advanced functional safety solutions to improve workplace safety. Similarly, Europe stands out as a leader in industrial automation, with a long history of strict safety regulations.

Source: Fatpos Global

Impact of COVID-19 on Functional Safety Market

Covid-19 pandemic had a significant impact on the functional safety market, especially within sectors like automotive, aerospace, and manufacturing. Disruptions in the supply chain and economic uncertainties resulted in project delays and low investments in safety-related technologies. However, the pandemic accelerated certain aspects of the functional safety market in the adoption of remote monitoring and diagnostics solutions to ensure continuous operational safety despite restricted physical access to facilities. Despite the challenges presented by the pandemic, the long-term prospects for the functional safety market remain promising as a result of regulatory needs and growing awareness of safety risks across various industries.

Functional Safety Market is further segmented by region into:

• North America Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – United States and Canada
• Latin America Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – Mexico, Argentina, Brazil, and Rest of Latin America
• Europe Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – United Kingdom, France, Germany, Italy, Spain, Belgium, Hungary, Luxembourg, Netherlands, Poland, NORDIC, Russia, Turkey, and Rest of Europe
• Asia Pacific Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – India, China, South Korea, Japan, Malaysia, Indonesia, New Zealand, Australia, and Rest of APAC
• Middle East and Africa Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – North Africa, Israel, GCC, South Africa, and Rest of MENA

Functional Safety Market Scope and Segments:

Frequently Asked Questions (FAQ):