Ball Bearing Manufacturing

Business for Sale Industry Economics




Projected CAGR

2005 - 2020


2020 - 2026






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The Ball Bearing Manufacturing sector produces ball bearing components that are used to secure, retain, and steer rotating components and to minimize rotational friction between two or more spinning components. Operators produce a variety of bearing types, including ball, tapered, and spherical. The sector has faced several challenges in recent years due to the volatility of steel prices, a raw material used in industrial goods.

Additionally, in 2020, COVID-19 (coronavirus) crossed into the United States from its birthplace in Wuhan, China. The coronavirus has contributed to worldwide economic instability, resulting in a decline in commodity prices, particularly steel. As a result, dropping steel prices and uneven levels of domestic demand have resulted in a decline in industry income during the next five years through 2020.

As a result of the volatility, industry revenue is predicted to fall at an annualized pace of 6.6 percent to $5.3 billion during the five years to 2020. On the other hand, revenue for the sector is predicted to drop by 20.7 percent in 2020 alone. Profitability, defined as profits before interest and taxes, is estimated to account for around 6.5 percent of revenue.

Domestic demand weakness has been a significant factor in the industry’s performance. The US manufacturing sector dropped in the middle of the five-year period as exports declined and weaker commodity prices resulted in fewer sales of heavy equipment. Falling steel costs, a critical component of bearings, initially dampened income as operators reduced prices in response to competition.

The majority of this competition has come from imports, which account for little more than 49.3 percent of domestic demand on average. Additionally, industry operators have had to struggle with declining exports, the sector’s biggest single market. Over the last five years, and appreciating currency and a competitive global environment have eroded the competitiveness of US exports.

Revenue in the business is expected to grow at an annualized rate of 3.8 percent to $6.4 billion during the five years to 2025. The US economy’s general upswing will almost certainly continue to drive increased industrial output, boosting demand for different types of industrial bearings. Additionally, import competitiveness is expected to ease somewhat as the currency depreciates and trade tensions restrain import growth. Dollar depreciation is also projected to boost sector exports after years of decline.


Ball Bearing Manufacturing provides roller bearings and ball bearings to machine and vehicle makers, industrial equipment firms, the military, and off-highway vehicle makers. The sector has faced significant overseas competition and periods of low local demand throughout the five years through 2020.

Additionally, an appreciating US currency has diminished the attractiveness of exports to overseas buyers, while lowering steel prices as a result of COVID-19 (coronavirus) have reduced buying costs and impacted commerce to and from afflicted regions. Thus, during the next five years to 2020, industry income is predicted to shrink by 6.6 percent annually to $5.3 billion, including a 20.7 percent reduction in 2020 alone.

Industry income is derived primarily from the industrial, transportation, and export sectors. Demand for industrial items is generated by industrial equipment makers in a variety of areas. For instance, mining equipment makers need gear drives with specially sized ball and roller bearings for drilling applications, whereas wind turbine makers demand the ball and roller bearings for their devices’ moving components.

Additionally, bearings are employed in a wide variety of machine tools and other factory equipment. The level of activity in these sectors has grown in the last five years, as seen by an increasing industrial production index, which combines manufacturing, mining, and utility output. However, as a result of the coronavirus, the US manufacturing sector weakened as export orders declined and commodities prices fell. As a result, industry demand decreased, resulting in a decline in industry revenue in 2015 and 2016. Additionally, revenue for the sector is expected to drop by 20.7 percent in 2020.

Another critical market for industrial goods is the automobile and transportation sector. Two-wheelers, passenger automobiles, light- and heavy-duty vehicles, railcars, airplanes, and spacecraft all need a variety of various ball and roller bearings for their moving components. Ball and roller bearings are purchased in substantial quantities by makers of airplanes, helicopters, and aircraft engines, and cars and automobiles.

These producers need spherical plain bearings, rod-end and journal bearings, and ball bearings with narrow sections. Demand from vehicle manufacturers increased for most of the five-year period, as increased consumer spending resulted in more automobile sales. The automobile industry, on the other hand, has gotten saturated in recent years, and increasing interest rates have increased the cost of vehicle finance. As a result, manufacturing has reached a stalemate, dampening bearing demand.

Additionally, industry participants have faced a weakening export market. Exports to the industry are predicted to decline at an average pace of 5.5 percent to $2.1 billion during the five years through 2020. This is partly because of the dollar’s gain, which has increased the price of US products for international buyers.

When combined with stiff competition from overseas makers of bearings, the strengthening dollar has resulted in a loss of worldwide market share for US producers. Finally, dropping steel prices (a critical component of bearing manufacture) lowered industry pricing and income in the first half of the five-year timeframe. Exports continued to drop in 2020 as a result of the coronavirus.

In addition to sometimes lackluster demand, the business has faced stiff overseas competition. Imports’ share of domestic demand has averaged slightly more than 49.0 percent during the last five years. Japan and China account for about 50% of total imports. Japan is a worldwide manufacturer of automotive and associated components, including bearings, and industry operator NSK Ltd. is the world’s third-biggest manufacturer of all bearings.

Japanese firms compete not just on pricing, but also product quality and technological excellence. China, on the other hand, can compete on price in more uniform product areas. Imports are predicted to fall at an average pace of 5.1 percent to $3.2 billion during the five years through 2020, including a 22.9 percent fall in 2020 due to the coronavirus.

While lowering steel prices initially impacted bearing prices and hence industry income, some operators were able to convert lower procurement costs into increased profit margins. However, the combination of rising steel costs and competition from overseas suppliers has eroded the industry’s average profit margin. Nonetheless, industry profit (defined as profits before interest and taxes) is predicted to slightly improve to 6.5 percent of sales in 2020, up from 6.4 percent in 2015.

To recoup profit and benefit from growing activity in downstream industrial sectors, operators have pursued mergers and acquisitions. For instance, Timken Company, a market leader, bought Carlisle Belts and Standard Machines during the last five years. Consolidation helps operators to achieve economies of scale, lowering per-unit manufacturing costs while maintaining profit margins.

As a consequence, Research anticipates that the number of organizations would decline by 1.6 percent annually to 105 in the five years to 2020. Additionally, employment is anticipated to fall by 4.4 percent annually to 18,008 employees, with a 14.3 percent loss in 2020 alone.


The Ball Bearing Manufacturing industry’s performance will continue to be influenced by demand from the automotive and transportation, aerospace and military, energy, and general industrial manufacturing sectors. Additionally, global markets will continue to serve as a major source of income. However, in both local and international markets, competition from Asian manufacturers will certainly result in operators withdrawing from the market. Industry revenue is expected to bounce back from the crash due to the appearance of the new coronavirus, which will grow at an average pace of 3.8% over the next five years to $6.4 billion.

Because the primary use of roller and ball bearings is in downstream markets, the overall market activity will affect industry performance. Industrial output is expected to increase at a pace of 1.2% per year during the next five years. With increased disposable income and improved company confidence, industrial capacity and output are anticipated to increase.

It is projected that the production of energy and minerals will rise while the development of renewable energy and other alternatives will develop and this will lead to rising demand. While rising interest rates and market saturation will cool the U.S. car industry, on the other hand, it is already starting to.” New automobile sales are predicted to climb at an annualized pace of 8.1% during the next five years. Due to this, the manufacturing of related bearings may stagnate, thereby reducing demand. Steel prices are expected to increase, driving up industry income and bearing costs.

For the last decade, domestic companies have had to contend with increased import competition from Japan, China, and Germany. Increasing import penetration will put more pressure on industry operators to lower their prices and cut expenses. This is necessary to keep operational profit intact while still controlling expenses. Small- and medium-sized enterprises are particularly vulnerable to greater import penetration since they have a hard time expanding due to their lack of economies of scale.

Due to the competitive pressures, they will not be able to pass through cost increases to downstream markets, and these increased metal prices will add to the profitability difficulties caused by metal price volatility. This is likely, given further import penetration is anticipated in the future. With an average growth rate of 2.6 percent, imports are predicted to expand to $3.6 billion in five years from now.

Because the value of the dollar is decreasing, imports will be more costly and exports will be cheaper worldwide. Furthermore, recent tariffs placed on Chinese bearing imports by the Trump administration may lead to greater trade obstacles.

In fact, even the recently agreed-upon United States-Mexico-Canada Agreement (a pending replacement of the North American Free Trade Agreement) is putting car manufacturers under greater strain, because it makes them source more of their vehicle parts from the North American region, which could impact the quantities of imported vehicles from Europe, Japan, and China. Although Canadian and Mexican imports will not be impacted, U.S. imports from everywhere in the world would be. Exports are anticipated to grow at a yearly pace of 4.2% to $2.5 billion during the next five years.

The profitability of large corporations will always be greater than that of smaller organizations. As a consequence, the industry is expected to increase at a compound annual growth rate (CAGR) of 1.1% over the projection period. Successful incumbents will continue to grow their operations and therefore expect a boost in industry employment over the long term.

However, due to the enormous investment that corporations are making in automating the workforce, new jobs will be restricted. Research forecasts an average annual growth rate of 2.3% to around 20,130 workers. Additionally, workers in the industry are expected to earn an average of $56,537 during the next decade. Nevertheless, increasing steel costs and more competition will almost certainly lead to declining industry profitability.

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Ball bearings and roller bearings are manufactured in this business for usage in transportation and industrial equipment production. Transportation, military, space, and energy are all significant markets. Plain (nonball and non roller) bearings are not manufactured by operators.

Ball Bearing Manufacturing is nearing the end of its life cycle. Research forecasts that the industry’s value-added (IVA), which quantifies its contribution to the economy, would fall by an annualized 1.2 percent over the next decade, through 2025.

This is less than the 1.9 percent annualized increase anticipated for the US gross domestic product for the same time, and the disparity is due to the disproportionate losses experienced due to low metal prices. Long-term, the sector is predicted to develop in lockstep with the economy.

Other advancements indicate the maturation of the sector. Major businesses have participated in a flurry of mergers and acquisitions in the five years to 2020, including the Timken Company’s (Timken) purchases of Lovejoy Inc. and Carlstar Belt LLC. Timken has increased its worldwide reach with the acquisition of ABC Bearings Ltd. in the third quarter of 2018.

Manufacturers are recognizing the need to combine operations in order to remain competitive since per-unit production costs reduce as manufacturing processes scale up. With steel prices becoming more volatile, companies have been obliged to compete for market dominance in order to sustain profitability independent of external conditions. Additionally, though the sector is always innovating to improve old items, the sector’s basic outputs and primary markets remain stable.

Participants in the industry are concentrating their efforts on operational reorganization and quality control. Operators will continue to prioritize restructuring or selling unproductive sectors and growing volume in lucrative sectors. Industry businesses have shrunk by 0.3 percent during the next decade, to 2025.

With few and few between product development breakthroughs, this gap in revolutionary innovation is characteristic of a mature business, in that it is no longer struggling for survival but is instead focused on upgrading current items.

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