Heavy (valuation) lifting: Warehouse packaging automation market to hit $7.5B by 2029

The global end-of-line and warehouse packaging automation market is projected to grow from $5.1 billion in 2024 to $7.5 billion by 2029, representing a compound annual growth rate of 7.9%, according to new research from Interact Analysis, a global market research firm. This $2.4 billion expansion is being driven primarily by warehouse applications rather than traditional manufacturing, as companies combat rising labor costs and respond to e-commerce demands for more efficient packaging solutions.

What you should know: Warehouse packaging automation is outpacing manufacturing growth, despite manufacturing currently holding the majority market share.

• End-of-line manufacturing packaging automation accounted for 61% of sector revenues in 2024, but this is expected to drop to 60% by 2029 as warehouse applications grow faster.
• Manufacturing applications like case packers (machines that put products into boxes), case sealers (machines that close boxes) and case erectors (machines that assemble flat boxes into shape) generated over $2.1 billion in combined revenues in 2024.
• The Americas region and warehouse packaging automation are anticipated to be significant drivers of overall market growth.

Why warehouse automation is surging: Manual processes in warehousing create greater opportunities for machine vendors compared to the more mature manufacturing sector.

• “Packaging automation is more mature within manufacturing environments. New machinery deployments are usually seen in newly-built facilities or where an increase in throughput is needed,” said Vanessa Lopez, research analyst for Interact Analysis.
• “However, in the warehousing sector, many packaging processes are still carried out manually, so there is greater opportunity for machine vendors here.”
• E-commerce demands and legislation that penalize retailers for material wastage are significant driving forces behind warehouse automation adoption.

Regional differences driving growth: Companies across different regions are investing in automation for varying reasons.

• Americas and Europe are increasing warehouse packaging automation investment primarily to combat rising labor costs.
• Both regions also see growth in end-of-line packaging systems for manufacturing due to high wage bills and regulatory pressures.
• APAC region growth stems mainly from general manufacturing industry expansion rather than rising labor costs.

The Amazon effect: The e-commerce giant is accelerating adoption of specific packaging technologies across the industry.

• “Amazon has supercharged the expectation for automatic right-fit boxers across our forecast period,” Lopez explained.
• The company has announced deployment of right-fit boxers (machines that automatically select the optimal box size for each shipment) across all its European facilities.
• Right-fit boxers, bagging machines, and robotic palletizing are seeing rapidly growing investment, though their market size remains relatively small compared to more established offerings.