Where Demand Persists

Despite the headwinds, certain markets continue pulling investment. Aerospace and defense remain robust. Energy markets—particularly oil and gas—show strength. And a newer category has captured attention.

Adam Gimpert, president of Helios Gear Products, identifies consumer robotics as “the biggest game-changer on the horizon.” This isn’t speculation about distant possibilities; it’s emerging demand requiring smaller, highly automated gear solutions at scale. Gleason similarly cites robotics among the markets showing relative strength.

Regionally, Asia continues to dominate. Klingelnberg reports that the biggest pull for bevel gear equipment, cylindrical gear grinding machines, and high-end metrology “continues to originate in Asia”—China, India, Japan, and Korea leading. This pattern has held for five years and shows no sign of shifting.

On the process side, hobbing remains “the bread and butter of the industry,” as Nidec puts it, because nothing matches its speed and cost per part. But finishing and inspection are gaining ground. Quality demands keep climbing, and shops increasingly recognize they can’t just cut gears fast—they have to prove they’re perfect.

The Electrification Question
The EV narrative has splintered along regional lines. In China, electrification for passenger cars and light commercial vehicles has reached what Klingelnberg describes as “maturity”—still growing, but at a sustainable pace rather than the frenetic expansion of recent years.

North America tells a different story. Nidec reports that “the full-EV rush has largely disappeared,” with hybrids taking the lead as the practical choice for anyone outside major cities. GMTA sees “a reversal narrative.” Helios notes that EV programs continue but timelines have stretched.

Perhaps more consequential than the policy shifts: the capacity question. Hollingsworth notes that electrification drove “many new projects post-COVID,” but warns that “the volumes are not materializing as expected.” Plants built for an EV surge that hasn’t arrived may stall further capacity investment—or see resources reallocated entirely.

Europe occupies a middle ground—electrification proceeding, but on “slow burn,” as Klingelnberg characterizes it.

For gear manufacturers, the message is clear: flexibility matters more than ever. The companies that bet everything on EV gearing may find themselves exposed; those maintaining capability across propulsion types are better positioned for however the market evolves. Micro-mobility presents its own opportunity—Klingelnberg expects that market to double by 2030, driven primarily by Europe and Asia.