Manufacturing - Industry - South America Market, Share and Trends 2023-2028

Summary of Manufacturing

South America has a well-established manufacturing sector concentrated in countries like Brazil, Argentina, Chile and Colombia. The region benefits from natural resource wealth supporting industries like petrochemicals, metals/mining, machinery, food/beverage and transportation equipment production. South America accounts for approximately 5-9% of global manufacturing output currently valued at an estimated $800 billion annually.

Based on our estimates, we can say that South America’s regional manufacturing industry is forecasted to be a $1468.17 billion industry in 2029 from $1344 billion in 2023 with a CAGR of 3.20%. This region contributes for approximately 8% of the global market revenue of the ‘Manufacturing’ industry.           

Looking ahead – South American manufacturing is well-positioned to influence the region’s natural endowments and growing domestic/regional markets. Countries like Colombia are working to expand their industrial capabilities through trade agreements and investment promotion. Ongoing urbanization and rising incomes underpin growing demand for manufactured goods across sectors.

Challenges persist in the form of infrastructure bottlenecks, political/economic instability in some nations, and skills shortages inhibiting adoption of advanced technologies. However – with the right policy reforms and investment – South American manufacturing has significant potential for continued development and job creation.

Recent Trends and Insights

The manufacturing sector is projected to grow at an annual rate of 3-4% through 2025– supported by trade deals and rising consumption. Countries are working to increase industrial competitiveness.

Countries are attracting investment in solar panel and wind turbine production to meet climate targets and domestic energy needs. Chile has become a leader in lithium extraction and battery manufacturing.

Projects in transportation, utilities, mining and telecoms are driving demand for industrial equipment, machinery, steel and cement. Manufacturers are investing in automation, robotics, 3D printing and digital tools to boost productivity and product quality, especially in major industrial hubs.

Governments are partnering with educational institutions and companies to expand technical training programs and address shortages of skilled manufacturing labor. Additionally – Mexico has been benefitting from more investment in manufacturing due to the trend of nearshoring – where companies relocate parts of their supply chain operations to closer countries for resilience reason.

Product Insights

Vehicles, parts and components are a leading sector, with Brazil a top global producer of trucks, buses and more. Electric vehicles are gaining traction. Steel, aluminum, copper and other metals production leverages regional mineral wealth. Chile and Brazil lead in lithium extraction and battery materials.

Food/beverage manufacturing is extensive, covering products from grains to processed foods, wine, coffee and more. Despite shifts, petrochemicals remain important– especially in Argentina, Brazil and Venezuela for plastics and fertilizers.

Manufacturing of solar panels, wind turbines, hydroelectric equipment is expanding to serve domestic green energy goals and markets abroad. Brazil’s Embraer is a leading regional aircraft maker. Growth in this advanced sector indicates skills and innovation potential.

Key Companies

Some major players within this vast domain of industry are

• Vale
• Embraer
• Arcor
• CMPC
• Petrobras
• Suzano
• Kimberly-Clark

Regional Analysis

Brazil in particular has a diverse manufacturing base and is one of the largest automotive producers worldwide. Other major industries include aircraft/aerospace, electronics, pharmaceuticals and paper/packaging. Argentina and Chile also have significant manufacturing contributions to their economies, focused on areas such as vehicle assembly, steel, agribusiness and more.

Vehicle production is growing steadily – with Brazil a top producer globally. Argentina and Colombia are also focusing on auto and auto parts manufacturing.

Argentina is another major player in South American manufacturing – with a focus on foodstuffs, beverages and tobacco production. The country experienced growth spurts during the first half of the decade but average growth rates then declined.

Venezuela’s industrial growth has been influenced by its oil industry, which accounts for about one-seventh of the total manufacturing output. Colombia is one of the fastest-growing economies in South America and its manufacturing sector is benefiting from the country’s economic growth.

Market Segmentation

By Production Processes:

• 3D printing
• Rapid prototyping
• Assembly Line manufacturing
• Continuous process manufacturing
• Build-to-order
• Engineer-to-order

By End User:

• Supply chain and industrial equipment
• Components for other industries
• Consumer goods production
• Personal electronics manufacturing

By Industry Verticals:

• Passenger Vehicles
• Commercial vehicles
• Electric vehicles
• Aircraft manufacturing
• Defense equipment
• Space exploration
• Consumer electronics
• Semiconductor manufacturing
• Industrial automation

By Country:

• Brazil
• Argentina
• Columbia

Our Methodology

We have offered a well-founded review of South America’s regional Manufacturing market along with ongoing trends and upcoming projections to highlight proximate investment opportunities in this report. Moreover, an extensive analysis of any future prospects, challenges, competitors, or navigating aspects is also provided. A methodical detailed regional examination is presented.

Primary Research  

Our multi-pronged research approach includes interviews with industry leaders and a global survey of advanced manufacturing professionals to gain qualitative insights. We utilize our proprietary databases encompassing key performance indicators worldwide in order to collate relevant data points. A multivariate forecasting framework considering historical performance, current dynamics and qualitative factors are utilized to develop market sizing and growth projections through 2029.

We supplement our primary research with a careful examination of secondary materials such as– case studies, news stories and references from other sources. Organizations can benefit from the strategic advice and conclusions offered because they will be better equipped to respond to the dynamic nature of this industry and seize emerging possibilities.

We employ a comprehensive and iterative research methodology focused on minimizing deviation to provide the most accurate market estimates. Our research utilizes a combination of bottom-up and top-down approaches across segments and utilizes databases, primary research insights and industry experts for analysis.

Raw data is obtained from multiple sources and thoroughly filtered to ensure only authenticated and validated sources are considered. We collect data from raw material suppliers, industry associations, technology providers, and buyers to gain a holistic perspective.

Quantitative Analysis

Our market estimates are derived through statistical models, beginning with collection of historical data and analysis of macro- and micro-economic factors influencing the market. Gathered information on market dynamics, technology and pricing trends are utilised to build the models.

Econometric and technological models are applied to project short- and long-term market potential respectively. A bottom-up approach is preferred to minimize errors. Key parameters considered include market drivers and restraints, material pricing trends, regulatory scenarios, and capacity additions.

Weights are assigned to these parameters based on impact analysis and market forecasting is performed via statistical tools and techniques. We believe this methodology results in an accurate and realistic market picture.