Elevated backlogs have provided production stability, but new orders and revenue will continue to be threatened by the economic uncertainties
![Strenghts](/en_global/economic-research/sector-reports/machinery-and-equipment/_jcr_content/root/parsys/wrapper/wrapper/multi_column_grid_co_1260989431/grid-0-par/wrapper/wrapper/image_copy_copy_copy.img.82.3360.png/1721908732072/sensitive-risk1.png)
SENSITIVE risk for enterprises
Strengths & Weaknesses
![Strenghts](/en_global/economic-research/sector-reports/machinery-and-equipment/_jcr_content/root/parsys/wrapper/wrapper/multi_column_grid_co/grid-0-par/wrapper_copy_copy_co/wrapper/image.img.82.3360.png/1720687529774/plus.png)
- High barriers to entry since a lot of investments in technology and capex need to be made in order to keep up with innovation and expansion.
- Strong long-term growth potential in robotics and process automation. The adoption of Artificial Intelligence (AI) is expected to further expand demand for smart and cutting-edge machinery.
- Companies with exposure to AI and automation will continue to have pricing power, given the limited offering amid surging demand.
- Revenue diversification: Very heterogeneous clients and end-markets, serving companies and people in all regions and all kind of industries.
![Weaknesses](/en_global/economic-research/sector-reports/machinery-and-equipment/_jcr_content/root/parsys/wrapper/wrapper/multi_column_grid_co/grid-1-par/wrapper_copy_copy/wrapper/image.img.82.3360.png/1720687542983/minus.png)
- Cyclical sector, with companies are hit hard during recession periods due to falling demand and lower prices.
- Complex and fragmented supply chain, which makes the sector highly vulnerable to supply disruptions or bottlenecks.
- Capital-intensive sector, with large investments and R&D expenditures necessary to expand business and offer new products that adapt to new client needs in each end-market.
- Susceptible to commodity access and prices since metals such as aluminium, copper, steel and nickel are heavily used for machinery building.