Analysis of the U.S. Machine Tool Development Environment and Business Opportunities in Key States
Current Status and Trends in the U.S. Machine Tool Industry
The United States is one of the top five global consumers and importers of machine tools. According to the IMARC Group, a global management consulting firm, the U.S. machine tool market size was approximately $11.8 billion in 2024 and is projected to continue growing at a Compound Annual Growth Rate (CAGR) of 3.73% from 2025 to 2033. This growth is primarily driven by the sustained increase in demand for metal products, coupled with new demands from electric vehicles, autonomous vehicles, and trucks, which are collectively boosting the utilization rate of machine tools in the U.S.
Local U.S. machine tool manufacturers primarily specialize in Computer Numerical Control (CNC), high-precision machining, large-scale machining centers, and integrated automation production lines. Major players include Haas Automation, Hardinge, Gleason Corporation, Hurco Companies, Fives Group USA, and Cincinnati Incorporated. In recent years, these companies have been aligning with major global trends by focusing on the dual transformation toward intelligent manufacturing and green, low-carbon production.
Despite the substantial demand for machine tools in the U.S., the production capacity of domestic manufacturers is limited, necessitating imports to meet a portion of the demand. While the U.S. has historically been the second-largest export market for Taiwan's machinery products, exhibiting a slight decline in the past five years, and is anticipated to face potential impacts from reciprocal tariffs and the appreciation of the New Taiwan Dollar against the U.S. dollar, the U.S. market still offers Taiwanese manufacturers reasonable profits compared to price-sensitive markets like China and the New Southbound Policy countries. Therefore, a deeper analysis of the environment across various states is essential to identify the most strategic markets.
Based on this, this study analyzes the machine tool import data for various U.S. states, selecting California, Illinois, Maryland, and Wisconsin as key states. These states have demonstrated significant machine tool import demand, rapid import growth, and particular potential for Taiwanese suppliers. The analysis covers the machine tool industry's development opportunities, local networks, and available resources in these states. This provides a reference for Taiwanese companies in their market assessment amidst the increasing uncertainties in the future U.S. market.
Business Opportunities for the Machine Tool Industry in Illinois
Business Environment
Illinois is the state with the highest Gross State Product (GSP) in the U.S. Midwest, boasting advantages in infrastructure, labor force, and R&D innovation. Its location at the crossroads of North American trade enables manufacturers to serve customers across the U.S.
According to the state's "Five-Year Economic Growth Plan," advanced manufacturing is one of the key growth sectors, primarily concentrated in the northwest and southeast regions of the state. This sector encompasses mechanical manufacturing, metal fabrication, chemical manufacturing, robotics, and advanced materials, employing 193,232 people with an average annual salary of $108,876.
Machine Tool Industry Profile
According to trade data from the U.S. Census Bureau, the machine tool product categories imported by Illinois from the world and from Taiwan between 2020 and 2024 are summarized in the table below. HS 8466 (Machine tool parts and accessories) consistently has a very high annual value, followed by HS 8458 (Lathes) and HS 8465 (Machine tools for working hard materials), which are also significant sources of demand in the state.
Illinois' import growth rate from Taiwan (23.52%) significantly surpasses its import growth rate from the world (1.9%), indicating strong demand for Taiwan's machine tools. Several product categories have shown double-digit growth over the past four years, in descending order: HS 8458, HS 8457 (Machining centers), and HS 8465.
Table 1: Illinois Machine Tool Import Information and Main Imported Products
Unit: US$ Million
| Global Imports | Taiwan Imports | |
| Product | Import Value (2024) | CAGR |
| 1 | Machine Tool Parts (8466) | 291.05 |
| 2 | Forging/Stamping Machines (8462) | 130.99 |
| 3 | Machining Centers (8457) | 102.28 |
| 4 | Discharge/Laser/Ultrasonic MT (8456) | 91.63 |
| 5 | Grinding Machines (8460) | 91.56 |
| Overall | - | 893.33 |
Source: US Census Bureau, Compiled by This Study
Note: Import Value for 2024; CAGR is for the five-year period (2020-2024)
Industry Cluster
The Chicago Metropolitan Area in Illinois is a dense cluster of machine tool manufacturers and metalworking factories due to its robust network of primary and semi-finished steel suppliers, skilled labor force, innovative enterprises, and its geographical and logistical advantages as a freight hub$^1$. This proximity fosters frequent collaboration and technical exchange.
The metal manufacturing industry in the Chicago metropolitan area has a complete supply chain, starting from raw steel procurement, transforming it into processed metal parts, and then assembling these parts into machinery used in applications such as medical devices, precision fasteners, construction, and transportation.
Notably, the Chicago area is focused on the development of Artificial Intelligence (AI) and the Internet of Things (IoT). Machine tool manufacturers are actively integrating intelligent features, 3D printing technology, and high-precision machining into their products to meet market demand for efficient, automated solutions.
Key Networks and Exhibitions
The Illinois Manufacturing Excellence Center (IMEC) and the Illinois Manufacturers' Association (IMA) are key associations and organizations related to manufacturing development in the state, maintaining a formal strategic partnership. They are introduced below:
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Illinois Manufacturing Excellence Center (IMEC):
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A non-profit organization dedicated to helping small and medium-sized manufacturers find new customers, transform products and processes, and drive digital and automation transformation. Its extensive network enables businesses to access consulting, technical assistance, and talent development.
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The center is funded by the Manufacturing Extension Partnership (MEP) under the U.S. Department of Commerce's National Institute of Standards and Technology (NIST). In 2022, IMEC received funding from the American Rescue Plan Act (ARPA) in McHenry County and Cook County, demonstrating support from both federal and local governments.
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Illinois Manufacturers' Association (IMA):
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The state's oldest and largest manufacturing advocacy organization. Its goal is to promote "Make It In Illinois," for example, by advocating for policies that support manufacturing, assisting companies with site expansion, and collaborating with the Illinois Department of Commerce and Economic Opportunity (DECO) to attract Foreign Direct Investment (FDI).
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Furthermore, there are two major machine tool exhibitions in Illinois that warrant further attention and participation from businesses:
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International Manufacturing Technology Show (IMTS): IMTS, one of the world's top three machine tool shows, is held in Chicago and is North America's largest and most significant mechanical manufacturing exhibition. This makes Chicago an essential platform for technical exchange and business development in the machine tool industry. This exhibition is held biannually$^2$.
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FABTECH (North America's Largest Metal Forming, Fabricating, Welding and Finishing Event): Given the high correlation between metalworking and the machine tool industry, this event provides a platform for machine tool suppliers to purchase related equipment and technologies. The event covers metal forming, fabrication, welding, automation, and robotics. FABTECH has previously circulated among cities such as Las Vegas, Atlanta, Chicago, and Orlando, and will be held in Chicago from September 8 to 11, 2025. Branch exhibitions are also held in Canada (Toronto) and Mexico (Mexico City, Monterrey).
Business Opportunities for the Machine Tool Industry in Wisconsin
Business Environment
Wisconsin (hereafter referred to as "the state") is situated in the western part of the Great Lakes Industrial Rust Belt. Its economy is primarily driven by manufacturing, agriculture, and tourism. In manufacturing, the state boasts mature industrial sectors such as food processing, metal fabrication, paper and printing, and plastics engineering, providing a strong market connection for machine tools used in these industries.
Wisconsin has the highest proportion of manufacturing labor in the U.S. and is often referred to as a global manufacturing center. Manufacturing contributes approximately $70 billion annually to the state's economy, accounting for 19% of its total output. The manufacturing sector employs 481,964 people with an average annual salary of $75,197, primarily concentrated in the eastern regions such as Milwaukee, Green Bay, and Madison.
Machine Tool Industry Profile
The 2024 machine tool import value, four-year CAGR, import value from Taiwan, and key imported products for Wisconsin are detailed in the table below:
Table 2: Wisconsin Machine Tool Import Information and Main Imported Products
Unit: US$ Million
| Global Imports | Taiwan Imports | |
| Product | Import Value (2024) | CAGR |
| 1 | Machine Tool Parts (8466) | 140.82 |
| 2 | Hard Material MT (8465) | 72.88 |
| 3 | Machining Centers (8457) | 64.38 |
| 4 | Forging/Stamping Machines (8462) | 39.27 |
| 5 | Lathes (8458) | 27.98 |
| Overall | - | 401.10 |
Source: US Census Bureau, Compiled by This Study
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The total import value ranks 10th among all U.S. states, showing significant growth demand.
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The import value from Taiwan ranks 4th among all U.S. states, indicating high and rapidly growing import demand.
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Overall import demand largely aligns with imports from Taiwan. In terms of overall growth, demand for HS 8457 and HS 8458 is growing faster. For imports from Taiwan, demand for HS 8457 is the most significant in terms of growth.
Industry Networks and Resources
Wisconsin assists the development of its manufacturing sector through regional industry alliances, collaborating with industry association networks such as the Wisconsin Center for Manufacturing & Productivity (WCMP) and the Northeast Wisconsin Manufacturing Alliance (NEWMA), as well as government agency resources like the Wisconsin Economic Development Corporation (WECD).
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Wisconsin Center for Manufacturing & Productivity (WCMP): The official NIST$^3$ Manufacturing Extension Partnership (MEP) center for Wisconsin, collaborating with the Manufacturing Outreach Center (MOC) at the University of Wisconsin-Stout and the Wisconsin Manufacturing Extension Partnership (WMEP)$^4$. It focuses on supplier development, export growth, operational excellence, sustainability, technology development, and workforce. It also holds annual events like "Manufacturing Matters!" and "Manufacturing Advantage" to help small and medium-sized manufacturers in the state with continuous development and transformation.
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NorthEast Wisconsin Manufacturing Alliance (NEWMA): A regional alliance composed of manufacturers in the state, collaborating with educational institutions, workforce development boards, chambers of commerce, and state government agencies. It connects academic career planning with corporate partnership platforms and enhances the image of manufacturing for young students to promote the sustainable development of manufacturing in the northeastern region.
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Wisconsin Economic Development Corporation (WECD): The primary economic development agency in Wisconsin responsible for promoting industrial growth and business investment. Through industry strategy development, investment expansion, and various other projects and network support, as well as executing business development tax credit programs for international businesses, it provides guidance and development resources for the state's manufacturing sector and channels to assist overseas companies in investing and setting up facilities in Wisconsin.
Wisconsin Manufacturing & Technology Show (WIMTS)
WIMTS is Wisconsin's largest manufacturing event, held biannually. The 2025 exhibition will focus on the integration of machine tools and innovative technologies, covering a wide range of exhibits including foundational manufacturing, robotics, machining centers, welding, tooling, and manufacturing equipment, aiming to boost the competitiveness and technological innovation of Wisconsin's manufacturing businesses.
Business Opportunities for the Machine Tool Industry in California
Business Environment
California is the most populous and largest economy among U.S. states, encompassing Silicon Valley and Hollywood, and boasts the largest manufacturing sector in the U.S. In 2023, California's manufacturing output was $397 billion, creating 1.3 million jobs and accounting for 7% of the state's labor force. Foreign machine tool manufacturers can benefit significantly from diverse sectors, especially major demands from the aerospace industry, digital technology, biotechnology, and electric vehicles.
While California offers vast business opportunities, the cost of doing business is relatively high, particularly in rent, wages, and utilities (the average monthly corporate bill in 2023 was $1,273). Labor laws are also relatively strict. Furthermore, the state government has recently prioritized the green transition and passed ESG disclosure laws, such as SB 261, the "Climate-Related Financial Risk Act." Although this law currently does not apply to small and medium-sized enterprises, the ESG development trend is still worth monitoring.
Machine Tool Industry Ecosystem
The primary manufacturing clusters are San Francisco and Silicon Valley (computers and electronics, biomedicine, high-end technology, etc.) and the Greater Los Angeles Area, including San Diego and Santa Clarita (defense industry, aerospace and transportation, medical devices, shipbuilding, precision manufacturing, etc.). To maintain a stable supply chain, California has become the largest machine tool import region in the U.S. According to the U.S. Census Bureau's trade database, the compound annual growth rate (CAGR) for California's total machine tool imports from 2020 to 2024 was 7.31%. In 2024, global imports exceeded $1.4 billion, with imports from Taiwan exceeding $200 million. Other main source countries for imports include China, Japan, South Korea, and Germany.
Taiwan's main machine tool exports to California include Machine Tool Parts (8466), Machining Centers (8457), Lathes (8458), and Machine Tools for Working Hard Materials (8465). As of May 2025, Taiwanese entrepreneurs have established 425 companies in California, including a distribution point set up by Goodway Machine Corp., one of Taiwan's largest machine tool manufacturers, in Ontario, California.
Table 4: California Machine Tool Import Information and Main Imported Products (2024)
Unit: US$ Million
| Global Imports | Taiwan Imports | |
| Product | Import Value (2024) | CAGR |
| 1 | Machine Tool Parts (8466) | 279.96 |
| 2 | Machining Centers (8457) | 320.12 |
| 3 | Lathes (8458) | 294.76 |
| 4 | Hard Material MT (8465) | 149.60 |
| Overall | - | 1475.05 |
Source: US Census Bureau, Compiled by This Study
Note: Import Value for 2024; CAGR is for the five-year period (2020-2024)
Industry Networks, Exhibitions, and Government Resources
California possesses numerous resources, exhibitions, government agencies, private associations, and non-profit organizations that can assist businesses entering the local market:
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California Governor’s Office of Business and Economic Development (GO-Biz):
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GO-Biz and other Governor's offices promote California's economic growth and business development initiatives. This includes the California Competes Tax Credit, which businesses entering California can apply for, and the Employment Training Panel, which provides funding for employee skills training.
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California Manufacturing Technology Consulting (CMTC):
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This association promotes the growth of small and medium-sized manufacturers in California and strengthens relevant business networks. Its programs include California’s Sourcing & Procurement Platform (CSPP), which facilitates matching between sellers and suppliers in the manufacturing sector. CMTC also offers business consulting services and created the "California’s Manufacturing Network" to assist small manufacturing plants.
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WESTEC (Manufacturing Technology Series WEST):
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This exhibition is held biannually, with the 2025 event taking place in Anaheim. It attracts thousands of attendees from the aerospace, medical device, precision machining, and other manufacturing industries.
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Business Opportunities for the Machine Tool Industry in Maryland
Business Environment
Maryland (MD) is located on the U.S. East Coast, adjacent to Washington, D.C. (D.C.). The state features three international airports, the Port of Baltimore (a crucial deep-water port on the East Coast), and a comprehensive highway and rail system, facilitating convenient freight and import/export operations.
Its proximity to D.C. means many federal government agencies and international organizations are situated in MD, including the Food and Drug Administration (FDA), National Institutes of Health (NIH), NASA, Environmental Protection Agency (EPA), National Security Agency (NSA), and the NIST National Cybersecurity Center of Excellence, as well as the Johns Hopkins Medicine Center. This attracts private companies in related fields, driving the thriving development of MD's biotech and medical technology, IT and cybersecurity, and aerospace and defense industries.
Regarding taxation, according to the TAX FOUNDATION's 2025 State Business Tax Climate Index, MD's overall tax rate ranks 46th, only better than D.C. (48th) among neighboring states. Its corporate income tax is 8.25%, significantly higher than competitors like Virginia, West Virginia, and North Carolina. Furthermore, it is the only U.S. state to levy a digital advertising tax.
MD ranks 27th among the best U.S. states for manufacturing (2023). Its manufacturing costs are 21% lower than the national average. The average weekly wage is $1,184 (Feb 2025), and the median single-family home price is $496,500 (Apr 2025).
Machine Tool Industry Profile
Although MD's machine tool imports account for only 1.23% of the total U.S. machine tool imports, its five-year import CAGR is the second-highest in the U.S. at 25.51%, indicating strong demand for Taiwanese machine tool products, with a five-year import CAGR from Taiwan soaring to 51.54%.
Taiwanese machine tools hold a 13.21% market share in MD's import market and maintain a significant presence in the top three import categories: Forging/Stamping Machines (8462) at 11.38%, Machine Tool Parts (8466) at 22.92%, and Hard Material Machine Tools (8465) at 36.38%.
The development of MD's biotech and medical technology, IT and cybersecurity, and defense and aerospace industries attracts numerous supporting small and medium-sized high-tech machining factories, system integrators, distributors, and equipment suppliers and processing plants related to the defense and aerospace supply chains. These businesses provide related products and services locally.
MD lacks large-scale machine tool OEM manufacturers but has many machinery dealers and repair shops that represent high-end European, American, and Japanese-made machines. Looking at the structure of MD's global machine tool imports, Forging/Stamping Machines (8462) are widely used in the defense, aerospace, and medical device industries, and Hard Material Machine Tools (8465) are core equipment supporting defense and aerospace manufacturing.
While imports from Taiwan hold great potential in MD, the state's high land, labor, and tax costs are unfavorable for initial investment in warehousing or setting up factories. Furthermore, East Coast agents or branches located in other states (such as Pennsylvania or New Jersey) can readily serve MD customers. Consequently, Taiwanese businesses have been relatively scarce in establishing physical presences or making direct investments in the state.
For future market expansion in MD, it is recommended to enter the market through MD distributors, automation integrators, or the network of Taiwanese businesses already established on the East Coast. Alternatively, Taiwanese companies with complementary products and an interest in the East Coast market could co-establish a one-stop exhibition center and hire local professional managers to develop the market.
Table 4: Maryland Machine Tool Import Information and Main Imported Products
Unit: US$ Million
| Global Imports | Taiwan Imports | |
| Product | Import Value (2024) | CAGR |
| 1 | Forging/Stamping Machines (8462) | 32.79 |
| 2 | Machine Tool Parts (8466) | 31.32 |
| 3 | Hard Material MT (8465) | 21.03 |
| 4 | Drilling, Boring, Milling MT (8459) | 18.02 |
| 5 | Discharge/Laser/Ultrasonic MT (8456) | 15.55 |
| Overall | - | 145.46 |
Source: US Census Bureau, Compiled by This Study
Note: Import Value for 2024; CAGR is for the five-year period (2020-2024)
Industry Cluster
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Baltimore Metropolitan Area: One of Maryland's industrial hubs, with numerous precision machining plants and repair service providers. It is also a cluster for machine tool distributors and technical integrators, with representative companies including Northrop Grumman (defense/aerospace) and renowned machine tool distributors like Marlin Steel Wire Products-Phillips Corporation.
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Montgomery County: Adjacent to D.C., the main industries are biotech/medical and precision instrument manufacturing, which rely on high-precision CNC and laser machining tools. Representative companies include MedImmune and GlaxoSmithKline (biotech/medical).
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Howard County: Located between Baltimore and D.C., it is home to many automated machine tool system integrators and technology-driven manufacturing startups.
Key Exhibitions
Major local professional machine tool exhibitions in MD are limited. However, nearby D.C., Pennsylvania, and Virginia all host representative exhibitions that attract relevant MD industry players annually. A more well-known local event is the Maryland Manufacturing Innovation Conference (MMIC), held every spring in Baltimore (the largest city) or Annapolis (the state capital). The conference focuses on manufacturing digitization, industrial automation, and smart factories.
Conclusion
The common thread among Illinois, Wisconsin, California, and Maryland is their status as regional transportation hubs, featuring significant ports and rail facilities that facilitate convenient machine tool import and distribution to other states. All four states also boast highly developed manufacturing sectors. Coupled with the recent policy trends of "Made in America" and advanced manufacturing, California consistently ranks in the top three for machine tool imports, while demand for machine tools in Illinois, Wisconsin, California, and Maryland is rapidly increasing.
In terms of machine tool product demand, Machine Tool Parts (HS 8466) is the most significant machine tool-related commodity exported from Taiwan to Illinois, Wisconsin, California, and Maryland. Demand for Hard Material Machine Tools (HS 8465) is also relatively high, especially in aerospace and defense-focused Maryland, where the growth rate for Taiwanese products reached 136%. Illinois and Wisconsin also saw growth of about 40% in this category. Machining Centers (HS 8457) show widespread demand (except in Maryland), with Taiwanese products seeing 116% growth in Wisconsin.
Except for California, Illinois and Wisconsin show the same ranking for imported products from both the world and Taiwan, but the import growth rate for Taiwanese products is consistently higher than for global products. Maryland shows rapid growth in imports of Hard Material Machine Tools, with a particular preference for Taiwanese products (accounting for 36% of MD's imports in this category). The growth rate of other Taiwanese machine tool products in Maryland is also higher than the global average.
Moving forward, manufacturers should consider Illinois, Wisconsin, and Maryland for market expansion, with particular attention to the demand for Machining Centers in Wisconsin and Hard Material Machine Tools in Maryland.
For expansion, Taiwanese companies can gain visibility by participating in important local and regional exhibitions, seeking distributors, and establishing cooperative links with local machine tool or Taiwanese business networks to reduce barriers to entry. This should be combined with the dual transformation trend of digital and green manufacturing to unlock new opportunities in the U.S. market.
