Vietnam Industrial Automation Market By Component (Hardware, Software, Services), By Enterprise Size (Large Enterprises, Small & Medium Enterprises), By Industry (Process Industries, Discrete Industries), By Region, Competition, Forecast and Opportunities, 2020-2030F

Market Overview

The Vietnam Industrial Automation Market was valued at USD 2.52 billion in 2024 and is expected to reach USD 4.21 billion by 2030 with a CAGR of 8.78% during the forecast period.

The Vietnam Industrial Automation Market is growing rapidly, driven by industrialization, government digital initiatives, and rising foreign direct investment in manufacturing. Vietnam’s emergence as a manufacturing hub in electronics, automotive, textiles, and food processing has increased demand for automation technologies, including PLCs, HMIs, industrial robots, and control systems. Free trade agreements and the China-plus-one strategy have encouraged multinational manufacturers to expand in Vietnam, further boosting automation adoption.

Hardware leads the market, with high demand for sensors, robotics, motion control, and industrial networking. Software solutions like MES, SCADA, and DCS are gaining traction for process transparency and centralized control. Services such as integration, maintenance, and post-sales support are increasingly important, particularly for SMEs adopting automation gradually. Government programs promoting Industry 4.0, smart factories, and IoT have further accelerated growth.

Global players such as Siemens, ABB, Schneider Electric, Mitsubishi Electric, and Rockwell Automation dominate the market, while local integrators like FPT Software and Autotech Machinery adapt technologies to local needs. With ongoing digitalization and smart manufacturing initiatives, Vietnam’s industrial automation market is set for continued expansion, offering opportunities for both global and local players.

Key Market Drivers

Rising Foreign Direct Investment (FDI) and Global Manufacturing Shift

Vietnam is rapidly becoming a key global manufacturing hub, largely due to geopolitical shifts and its trade openness. In 2023, the country attracted over USD36 billion in FDI, marking nearly a 30% increase from the previous year. The electronics and high-tech sectors alone accounted for more than 65% of new investment inflows. Industrial production expanded by 10.3% in Q2 2025, supported by new manufacturing setups. Export value jumped by 18% to approximately USD117 billion in Q2 2025, while imports climbed by 18.8% in the same period. The trade surplus stood at USD4.4 billion during the same quarter. These figures reflect the influx of high-tech factories from companies seeking China+1 diversification. New entrants often adopt automation technologies like robotics, PLCs, and smart control systems from the outset, accelerating automation penetration in Vietnam’s industrial zones.

Government-Led Digital Transformation and Industry 4.0 Initiatives

Vietnam's government has laid out a clear roadmap to implement Industry 4.0, boosting automation adoption across key sectors. A national strategy targets widespread deployment of AI, IoT, and robotics by 2030. Digital infrastructure expansion is a priority, with high-tech zones being upgraded to support 1 Gbps internet speeds by 2025. Mobile broadband is expected to cover 99% of the population by 2030. Saigon Hi-Tech Park has expanded from 326 to over 900 hectares to accommodate more automation-focused factories. Smart factory pilot programs trained over 100 local experts and supported more than 50 SMEs in adopting automated solutions. Tax incentives, training programs, and infrastructure support together create a highly favorable environment for automation technology integration in manufacturing.

Acceleration of Industrial IoT (IIoT) and Smart Factory Adoption

IIoT deployment is rapidly increasing across Vietnamese industries, enabling real-time monitoring, predictive maintenance, and data-driven optimization. By 2025, over 75% of large manufacturers had implemented some form of automation or sensor-based monitoring. The broader IoT market in Vietnam has expanded to cover more than 50% of manufacturing-related use cases. About 67% of industrial firms report plans to automate new tasks within the next two years. In electronics manufacturing, Vietnam's largest export sector, automated systems are used in more than 80% of high-volume lines. Industrial robotics installations increased by 15% year-on-year, especially in automotive and electronics. The growth of smart systems continues to reshape how factories operate, making IIoT adoption a core market driver.

Increasing Labor Costs and Demand for Efficiency

With Vietnam's middle class expanding, labor costs have steadily risen, pushing manufacturers to pursue automation as a cost-control measure. From 2019 to 2021, the economy maintained growth above 6.7% annually, driven partly by improvements in manufacturing efficiency. In recent years, around 27% of manufacturing firms reported workforce reductions directly related to automation adoption. Another 35% maintained existing headcount while increasing output—indicating productivity gains through automation. Smart manufacturing technologies have enabled GDP growth even during labor shortages. Additionally, factory operators report up to 30% savings in operational costs after integrating automation tools. In logistics and warehousing, labor-saving automation systems now handle up to 40% of repetitive tasks, allowing reallocation of workers to higher-value roles.

E-Commerce Growth Driving Logistics and Warehouse Automation

Vietnam’s booming e-commerce market is fueling demand for logistics and warehouse automation technologies. E-commerce transaction growth has averaged 30% annually between 2021 and 2025. Online retail value exceeded USD13 billion in 2021 and is expected to more than double in a few years. Over 400,000 domestic sellers now operate on platforms like Shopee and Tiki, offering over 15 million products. Average order fulfillment times have dropped by 25% due to automation adoption in warehousing. Automated Guided Vehicles (AGVs), smart conveyors, and robotic sorting systems are being adopted at distribution centers, especially in Ho Chi Minh City and Hanoi. Over 35% of logistics firms have implemented at least one form of warehouse automation to keep up with order volumes. Automation is no longer just a tool for manufacturing it's critical to modern commerce in Vietnam.

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Key Market Challenges

Limited Technical Expertise & Workforce Readiness

Despite strong enthusiasm, a core challenge lies in the scarcity of skilled automation professionals. Many Vietnamese manufacturers lack staff with hands-on experience in PLC programming, IIoT system deployment, and predictive-maintenance analytics. Reports indicate that only around 30% of SMEs have staff trained in digital manufacturing methodologies, and less than 20% can independently configure robotics systems.

While large exporters often bring in foreign experts, local talent pipelines are often insufficient less than 10 universities currently offer specialized robotic engineering courses, and apprenticeship programs cover fewer than 500 students annually. This training gap slows down projects, often doubling commissioning timelines from a planned 6 months to over a year. As a result, many firms depend on international system integrators or short-term consultants, adding extra 15-20% cost premiums.

And every time a factory upgrades software or adds machines, retraining downtime can stretch to 3-4 weeks. Overcoming these human-capital limitations is essential. Without a sizable pool of competent automation engineers and technicians, widespread adoption remains constrained to a few export-oriented enterprises, leaving local manufacturing and more dispersed SMEs struggling to embrace full automation.

High Upfront Investment & ROI Uncertainty

Automation typically involves heavy initial outlays robots, control hardware, sensors, software, and integration services can amount to hundreds of thousands of dollars per production line. For SMEs, this is often prohibitive. Even for mid-sized players, recoupment periods frequently extend between 3 and 5 years, with ROI often uncertain.

Case studies in electronics and food processing show that only about 40% of automation projects hit projected ROI within two years; the remaining 60% face delays due to calibration hiccups, custom tooling needs, or under-utilization of installed systems. Some projects also run 20–30% over budget due to integration complexities. This scenario leads many firms to delay or abandon automation plans until market pressure becomes overwhelming.

Banks and financiers are reluctant to lend for automation, citing a lack of track record and collateral. As a result, most early adopters seek government subsidies or vendor financing, which typically supports less than 25% of project value, leaving a significant gap. Without mechanisms to de-risk investment, such as leasing models, pay-per-use financing, or performance guarantees, large-scale automation remains financially out of reach for many potential users.

Fragmented Ecosystem & Lack of Local Integrators

Vietnam’s ecosystem of automation vendors, systems integrators, and software providers remains fragmented. There are a few well-known integrators in major zones but for most localities, finding a trusted partner is difficult. In fact, over 60% of automation inquiries fail to secure comprehensive end-to-end support, forcing manufacturers to contract multiple vendors: a robot supplier, a PLC specialist, and a software integrator. This fragmentation raises coordination burden suppliers often blame each other when glitches occur and leads to integration delays of 20–25%.

Moreover, many integrators lack standardized processes such as exhaustive testing protocols or digital twin simulation; local adoption of such practices remains under 15%. Post-installation support is patchy: only 45% of integrators provide 24/7 remote diagnostic services, and less than 30% guarantee uptime SLAs. This pushes manufacturers toward global brands like Siemens or ABB, but these come with premium costs and commitment issues during after-sales. Establishing a mature, reliable, and certified local ecosystem would streamline deployment, reduce costs, and build long-term trust across the supply chain.

Interoperability & Legacy System Integration

Many Vietnamese factories operate with legacy equipment, older PLCs, analog controls, and non-networked sensors built over decades. Integrating these into modern digital systems presents both technical and financial hurdles. Surveys show that over 70% of existing lines would need retrofitting with IoT-enabled gateway modules to connect with MES or SCADA platforms. Simply installing a gateway can cost USD5,000 to 10,000 per line, and retrofitting takes 1–3 days—even for a single production line. In many cases, manufacturers lack complete documentation of original control schemes, leading to months-long reverse-engineering efforts.

Furthermore, compatibility between different vendors’ communication protocols (e.g., Modbus, Profibus, Ethernet/IP) requires protocol translation middleware or full hardware replacement. Some lines need dual-run operation to prevent production stoppage during switchover, causing duplicate maintenance costs for weeks or months. Without standardization on open platforms and tools, interoperability gaps reduce automation ROI and hinder scalability. This is a major deterrent for factories that wish to gradually migrate toward full automation, rather than opt for greenfield setups.

Cybersecurity & Data Privacy Concerns

As factories go digital, vulnerabilities multiply. Connectivity brings risks from unauthorized access to ransomware attacks. In a recent audit of 50 medium-sized enterprises adopting IIoT, over 60% lacked basic segmentation between enterprise and industrial networks. More strikingly, more than 40% left remote-access ports open, and only 25% had up-to-date firmware on their routers or firewalls. Incidents confirmed malware infiltration into HMIs and plant historian systems in at least 10 cases last year, causing up to two days of downtime each.

Hesitation to embrace cloud-based analytics or remote diagnostics stems from fears around data breaches and intellectual property leakage, especially in contract manufacturing. Even vendors and integrators often neglect to build in proper authentication or network isolation during project deployment: only 30% of projects implement regular security audits or penetration testing. As a result, many automation rollouts are restricted to isolated networks, missing out on centralized monitoring benefits. A unified approach to industrial cybersecurity, defined standards, certification, vendor accountability, and insurance-backed deployment remains crucial to bridge trust gaps and accelerate adoption.

Key Market Trends

Growth of Cloud-Based and Edge Computing Solutions

Cloud-based automation platforms and edge computing are transforming how Vietnamese manufacturers manage operations and data. Instead of relying solely on on-premise infrastructure, companies are increasingly adopting hybrid and cloud-native models. For instance, Kärcher launched a fully cloud-native factory near Ho Chi Minh City in February 2024, completing the setup in just 11 months and saving six-figure sums by eliminating on-site hardware costs. 

Critical real-time control functions are performed at the edge (near the machines), while long-term data analytics, reporting, and enterprise integration happen via the cloud. This dual approach helps reduce latency for immediate tasks while enabling deeper business insights from aggregated data. For example, real-time edge devices now handle tasks like AI-powered defect detection, facial recognition for security, predictive maintenance, and production line optimization. 

Meanwhile, cloud platforms are used for performance benchmarking, energy management, and integrating systems across multiple facilities; Kärcher's Vietnam plant runs all its processes, from its ERP system to autonomous transport vehicle management, on AWS cloud infrastructure hosted in Singapore with no noticeable latency. This trend is gaining momentum, particularly in regions with strong internet connectivity, such as Hanoi and Ho Chi Minh City. 

Cloud-native SCADA and manufacturing dashboards are also enabling remote operations and diagnostics, especially valuable for multi-site operators in sectors like chemical manufacturing. Vietnamese manufacturers are finding these architectures scalable and cost-efficient, especially for supporting new product lines, as demonstrated by the Kärcher facility, which now serves as a global template for the company due to its flexibility and reduced operational costs. As local data centers and 5G networks improve, the use of cloud- and edge-enabled automation is likely to become standard across the industrial sector.

Integration of Energy Efficiency into Automation Strategies

Sustainability and energy efficiency are becoming integral parts of Vietnam's industrial automation roadmap. Rising electricity costs and environmental regulations, supported by initiatives like the Vietnam Scaling Up Energy Efficiency Project (VSUEE) an $11.3 million project running from March 2022 to January 2026—are compelling manufacturers to optimize their energy consumption through automation. 

Energy monitoring systems are now being embedded into plant control platforms, enabling real-time tracking of electricity, water, and gas usage, such as in the DEEP C industrial zones covering over 3,300 hectares in Hai Phong and Quang Ninh, where data is used to optimize the power grid. Variable frequency drives (VFDs) are being adopted to control motor speed and reduce energy draw during low-load operations, alongside smart lighting and HVAC systems connected to centralized automation infrastructure. 

Moreover, industrial automation is being used to minimize waste in production lines; for example, in the steel sector, where one ton of steel can generate 10,000 m³ of exhaust gas, the Hoa Phat Hai Duong complex installed 10 continuous emission monitoring systems to track and reduce emissions from its production of 850,000 tons of steel per year. 

Green manufacturing certifications and the EU-Vietnam Free Trade Agreement (EVFTA) are encouraging investment in low-carbon automation systems, as companies exporting to Europe or North America face pressure to demonstrate carbon transparency. 

In some industrial zones, energy audits are mandatory for enterprises consuming over 1,000 tons of oil equivalent (TOE) annually to receive infrastructure upgrades, leading to greater demand for automation that reduces both energy intensity and emissions. This trend reflects a broader movement toward sustainable automation across Vietnam’s industrial base.

Rising Adoption of Modular and Scalable Automation Systems

Vietnamese manufacturers are increasingly opting for modular automation systems that allow gradual scaling based on production needs and budget constraints. This trend is especially relevant to small and mid-sized enterprises that cannot afford large-scale automation investments upfront. Instead of fully automating entire plants, companies are beginning with specific pain points like bottlenecks in packaging or quality control and deploying modular units like vision systems, pick-and-place robots, or smart conveyors.

These systems often feature plug-and-play architecture and are compatible with various brands and protocols, offering flexibility and faster integration. Modularity also allows for easier upgrades; a factory can begin with basic PLCs and gradually integrate MES and IIoT systems as it matures. As contract manufacturing becomes more dynamic, manufacturers need to adapt lines for new clients and product SKUs quickly. Modular automation offers the agility required in such fast-changing environments.

Additionally, software-defined control systems are enabling remote reprogramming, making it easier to shift modules between lines. Over time, this trend is expected to reduce entry barriers and democratize automation access for a wider range of Vietnamese industries.

Segmental Insights

Component Insights

The hardware segment dominated the Vietnam Industrial Automation market in 2024 due to its foundational role in enabling automated operations across key industries such as electronics, automotive, and food processing. The country's manufacturing boom, fueled by foreign direct investment and the China-plus-one strategy, has led to significant demand for automation-ready infrastructure, with hardware forming the core of that transformation.

Vietnamese factories prioritize investments in programmable logic controllers (PLCs), sensors, actuators, industrial robots, and human-machine interfaces (HMIs) to establish base-level automation. These physical components are essential for upgrading legacy machinery and constructing new production lines, especially in export-focused sectors. As companies expand or relocate operations into Vietnam, they require turnkey automation hardware to meet international productivity and quality standards.

Additionally, many Vietnamese small and medium enterprises (SMEs) are in the early stages of digital transformation. For such firms, hardware is often the most visible and immediate automation solution, offering clear returns on productivity and labor efficiency. Unlike software systems, which require process redesign and workforce training, hardware can be installed incrementally with fewer disruptions.

Furthermore, the rise of industrial robots, collaborative robots (cobots), and smart sensor networks is driving demand for advanced hardware. Cobots, in particular, are being adopted by SMEs due to their lower cost, smaller footprint, and ability to work safely alongside human operators. Growth in warehouse automation, driven by the e-commerce boom, also adds to hardware demand for conveyors, scanners, and automated guided vehicles (AGVs).

While software and services are expanding, their growth often follows hardware deployment. In many factories, software adoption (like SCADA or MES) begins only after physical control systems are fully operational. Therefore, in 2024, hardware remains the primary enabler of automation in Vietnam—both as a standalone investment and as the first step in a broader digital strategy.

Enterprise Size Insights

Large Enterprises segment dominated the Vietnam Industrial Automation market in 2024 due to their greater financial capacity, access to advanced technology, and strategic focus on productivity and global competitiveness. These enterprises, particularly in electronics, automotive, and heavy manufacturing, prioritized large-scale automation to enhance efficiency, reduce labor dependency, and meet international quality standards.

Their ability to invest in end-to-end automation—including robotics, IIoT, and advanced control systems placed them ahead of SMEs, which often faced budget and skill limitations. Additionally, multinational manufacturers operating in Vietnam accelerated adoption to align with global smart factory initiatives.

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Region Insights

Largest Region

Southern Vietnam dominated the Vietnam Industrial Automation market in 2024 due to its strong industrial base, high concentration of export-oriented manufacturing, and advanced infrastructure. Cities such as Ho Chi Minh City, Binh Duong, Dong Nai, and Long An have long been home to major industrial zones, attracting significant foreign direct investment (FDI), especially from Japan, South Korea, the U.S., and Europe. These investments are typically directed toward high-tech and labor-intensive sectors like electronics, automotive, textiles, and consumer goods industries that rely heavily on automation to maintain efficiency and product quality.

The region benefits from a dense network of industrial parks, logistics hubs, and ports, including the Cat Lai Port and Cai Mep-Thi Vai deep-sea port complex, which facilitates the fast movement of goods and raw materials. These logistical advantages make automation essential for managing high volumes of production and exports. Additionally, large enterprises more prevalent in Southern Vietnam are more likely to adopt advanced automation systems such as PLCs, SCADA, DCS, and robotics.

Southern Vietnam also has a stronger concentration of technical talent, automation vendors, and system integrators, enabling smoother implementation and maintenance of industrial automation systems. Major training institutions and partnerships with foreign automation suppliers have supported the development of a skilled workforce capable of operating and maintaining modern automation infrastructure.

Moreover, the region’s well-established supply chain ecosystem allows manufacturers to deploy modular, scalable automation solutions, reducing installation times and costs. High-speed internet coverage and growing smart infrastructure further support the adoption of cloud-based and IIoT-enabled systems.

As Vietnam transitions toward Industry 4.0, Southern Vietnam’s maturity in industrialization, infrastructure, and international connectivity has positioned it as the central hub for industrial automation in 2024, outpacing the northern and central regions in both adoption and innovation.

Emerging Region

Northern Vietnam is the emerging region in the Vietnam Industrial Automation market in the coming period due to the rapid expansion of high-tech manufacturing, particularly in provinces like Bac Ninh, Hai Phong, and Hanoi. The region has attracted major foreign investments from electronics giants in semiconductor and smartphone production. With new industrial parks, improved transport infrastructure, and strong government support for Industry 4.0, automation demand is rising sharply. Additionally, the presence of skilled labor and proximity to China enhances supply chain efficiency, making Northern Vietnam a growing hotspot for automation deployment in advanced, export-driven industries.

Recent Developments

• In 2025, Secutech Vietnam 2025 was announced, with a major focus on smart factory solutions, including industrial robots and automation technologies.
• In August 2025, Automation World Vietnam 2025, a major exhibition, is scheduled to take place in Binh Duong, featuring 300 booths from 20 countries. The event will showcase the latest in smart factory solutions, robotics, and industrial automation.
• In April 2025, Rockwell Automation announced it would host its ROKLive event in Hanoi. The conference is set to bring together industry leaders to discuss digital transformation and the future of industrial automation.
• In April 2025, SUEZ entered a joint venture with state-owned Sonadezi, which oversees 11 major industrial parks in Vietnam. The partnership will deliver integrated environmental solutions to the largest industrial park in Southern Vietnam. Marking SUEZ’s first industrial park project in the country and 22nd in Asia, this move underscores the company’s regional commitment to sustainable growth through advanced industrial water and waste management aligned with circular economy principles.
• In June 2025, Vietnam achieved partner-country status within BRICS, joining Malaysia, Indonesia, and Thailand in expanding ties with emerging economies. This milestone reinforces Vietnam’s strategy to diversify global partnerships and deepen multilateral cooperation. The alignment enhances the country’s geopolitical relevance and offers investors broader access to high-growth markets through South-South engagement, signaling Vietnam’s continued evolution as a globally integrated, economically progressive player.
• In July 2025, Vietnam and Germany signed a joint declaration to advance a strategic energy partnership focused on offshore wind, energy efficiency, and industrial decarbonization. The agreement targets carbon neutrality and modernized power infrastructure while strengthening bilateral trade. It complements Vietnam’s broader energy strategy, including regional agreements with Malaysia and Singapore to export offshore wind power, positioning the country as a future hub for renewable energy transmission in Southeast Asia.
• In May 2025, Vietnam expanded bilateral ties with Germany and Austria through new agreements in agriculture, tech innovation, and workforce development. These partnerships include initiatives in AI, semiconductors, biotechnology, and vocational training, supporting Vietnam’s long-term goal to transition into a high-income, knowledge-based economy. The move reflects the government’s proactive approach to international collaboration, attracting high-tech investments and reinforcing its role in the global innovation ecosystem.

Key Market Players

• Siemens     
• ABB
• Schneider Electric
• Rockwell Automation
• Honeywell
• Emerson
• Mitsubishi Electric
• Yokogawa
• Omron
• Fanuc

Report Scope:

In this report, the Vietnam Industrial Automation Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Vietnam Industrial Automation Market, By Component:

o   Hardware

o   Software

o   Services

• Vietnam Industrial Automation Market, By Enterprise Size:

o   Large Enterprises

o   Small & Medium Enterprises

• Vietnam Industrial Automation Market, By Industry:

o   Process Industries

o   Discrete Industries

• Vietnam Industrial Automation Market, By Region:

o   Northern Vietnam

o   Central Vietnam

o   Southern Vietnam

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Vietnam Industrial Automation Market.

Available Customizations:

Vietnam Industrial Automation Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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