The State of Gear Machine Tools 2025

Challenges, opportunities, and emerging trends

As the gear industry steps into 2025, manufacturers are navigating a landscape shaped by geopolitical uncertainties, evolving workforce dynamics, and rapid technological advancements. Alongside Gear Technology’s annual State of the Gear Industry survey, we like to gather insights from leading machine tool manufacturers on the challenges, opportunities, and trends defining the year ahead.

Global Uncertainty Shapes Industry Outlook

Peter Wiedemann, managing director, Liebherr-Verzahntechnik GmbH.

Peter Wiedemann, managing director, Liebherr-Verzahntechnik GmbH.

John Perrotti, chairman and CEO, Gleason Corporation.

Manufacturers cite geopolitical tensions and economic instability as primary concerns. Peter Wiedemann managing director of Liebherr-Verzahntechnik GmbH underscores, “U.S./China tensions. European political instability. European bureaucracy.” Felix Scholz, managing director of Liebherr Gear and Automation Technologies, Inc., adds that uncertainty surrounding industrial tariffs is a lingering challenge. John Perrotti, chairman and CEO of Gleason Corporation, concurs, noting that, “As we enter 2025, geo-political uncertainties still remain.” Shane Hollingsworth, vice president of sales at Kapp Technologies highlights the difficulty of positioning products effectively, stating, “It’s been difficult to predict, and considering the worldwide landscape, it will be interesting to see how the U.S. market converges or diverges from the rest of the world’s major economies.”

Perrotti further elaborates, “While global instability continues, we are focusing on leveraging our strengths in automation and precision manufacturing to ensure long-term competitiveness. The companies that can rapidly adapt to geopolitical shifts will be the ones that thrive.”

Amid these concerns, reshoring efforts and supply chain shifts offer optimism. Wiedemann highlights India’s growing role in global supply chains, stating, “New (potential) suppliers will need to continuously invest in sophisticated technology.” Scholz points to the “positive trend of reshoring activities bringing manufacturing back to the United States.” Jeffrey Smith, president of NIDEC Machine Tools America, also sees growth as the primary objective: “The biggest challenge is the same as always—grow!”

Jeffrey Smith, president, Nidec Machine Tools America.

Shane Hollingsworth, vice president sales, Kapp Technologies.

Claudia Hambleton, office manager, GMTA.

Scott Yoders, vice president sales, Liebherr Gear and Automation Technologies, Inc.

Bridging the Skills Gap

The industry continues to grapple with workforce shortages, but companies are evolving training programs to meet changing demands. Gleason Corporation offers a broad range of training options, from fundamental classes to specialized technology training, while Liebherr emphasizes its ongoing commitment to in-house training for employees and customers alike.

Shane Hollingsworth of Kapp Technologies underscores the challenge of onboarding new employees in such a specialized industry: “The world of gears is quite unique, and most new employees start with no experience. Utilizing not only in-house training but also industry courses such as AGMA’s is key for our future employees.”

Meanwhile, GMTA’s Claudia Hambleton sees apprenticeship-style training as a crucial tool: “We still have a large skills gap, but more companies are working to close it with educational opportunities and real-world skills.” She also notes that “Online and virtual learning is one of the few positive outcomes of the pandemic. The opportunities to learn new information are extensive.”

Smith at NIDEC takes a straightforward approach: “Education at its core still remains the same—people need information and experience to dovetail as fast as possible to get the knowledge to stick.”

Perrotti adds, “We are heavily investing in cross-training and skill development because the modern gear industry requires a workforce that is adaptable and ready for next-generation technologies.”

The Rise of Smart Manufacturing

The adoption of Industry 4.0, IIoT, and Industry 5.0 continues to transform manufacturing. Liebherr-Verzahntechnik GmbH is focused on developing digital tools to enhance productivity, while Gleason Corporation integrates digital twins and smart-loop manufacturing to improve precision and efficiency.

Perrotti explains Gleason’s approach: “Binding design, manufacturing, and metrology together with digital solutions is one of our core strategies.” Meanwhile, Liebherr’s Peter Wiedemann emphasizes the need for data-driven decision-making, stating, “We are constantly designing new digital tools for our customers to support them in keeping productivity up, identifying potential bottlenecks in the production environment through data analysis, and defining the right corrective actions, such as preventative maintenance.”

Regarding the role of AI in manufacturing, Perrotti states, “Artificial intelligence and machine learning will play a critical role in predictive maintenance and production optimization, making factories more efficient and resilient.”

E-Mobility’s Uncertain Trajectory

The e-mobility market remains a wildcard. While China continues to lead innovations, North America’s demand has not met expectations. Felix Scholz notes, “The market demand for e-mobility in North America did not match predictions and will remain an uncertainty for the U.S. automotive market.”

Hambleton from GMTA adds, “We have been greatly impacted by the hesitation in the EV market. Hybrid vehicles seem to be the most viable option right now.” John Perrotti sees a mixed picture, observing that “E-mobility is still growing, but, in most markets other than China, it is growing at a slower rate. Plug-in hybrids have gained momentum in the U.S. market, but incentives are disappearing, which may put downward pressure on the growth rate.”

Sustainability Is More Than a Trend

Manufacturers are taking a proactive approach to sustainability. Scott Yoders, Vice President Sales at Liebherr Gear and Automation Technologies, Inc., highlights their real-time energy monitoring system, allowing customers to track and optimize energy consumption: “This helps our customer base reduce their costs and also makes a significant contribution to sustainability.”

Gleason Corporation similarly integrates energy efficiency and emission management into its long-term strategy. Perrotti adds, “This is a continuous, long-term strategy also in 2025.”

Industry Blind Spots

Beyond well-known issues, some challenges are not getting enough attention. Peter Wiedemann calls for pragmatic U.S.-Europe trade agreements to counteract bureaucratic inefficiencies.

Perrotti points to aerospace, defense, and robotics as growing markets that deserve more focus, adding, “Western economies are still running short in protecting and rebuilding key industries to become less dependent on Asian supply.” Jeffrey Smith also highlights the growing role of AI and automation in manufacturing: “Generalists with a good comprehension of a variety of skills will be needed. In manufacturing, we can see this as cobots and industrial AI come to market.”

Policy Landscape: Waiting for Clarity

Recent U.S. trade, energy, and workforce policy shifts create both challenges and opportunities. While Gleason Corporation and Kapp Technologies are cautiously monitoring domestic energy policies, NIDEC’s Jeffrey Smith emphasizes flexibility in response to changing political landscapes: “Given the switch in parties in power, we are being cautiously optimistic, taking care to prepare for as many outcomes as possible.”

The Road Ahead

Despite challenges, manufacturers remain optimistic about growth, innovation, and new market opportunities. As Shane Hollingsworth aptly puts it, “We want all of our organization to feel we are in the boat and all heading in the same positive direction, even if we hit a few waves along the way.”

The year ahead will test the resilience of the gear industry, but with strategic investments in technology, workforce development, and sustainability, companies are poised to navigate the uncertainties of 2025—and beyond.