A changing world

Sandvik has defined key external factors and drivers that impact our company. We will seize the opportunities they bring to generate profitable growth while managing risks and minimizing environmental impact.

Digitalization and automation

The manufacturing and mining industries are experiencing a shift to digitalization and automation. Access to big data, sophisticated analytical tools, robotics and artificial intelligence are creating new business opportunities and improved business intelligence. New ways for people to interact with machines and the ability to transfer digital instructions into physical products or equipment enable real-time decisions in the machining process. Such developments contribute to reduced costs, increased productivity and improved management of fluctuations in demand. It also places greater demands on our coworkers’ expertise. Sandvik offers digitalized solutions and services to optimize its customers’ operations pertaining to costs, productivity and environmental impact.

Historically, design, machining and analysis have been three clearly defined phases in the manufacturing of components. Digitalization and technology, such as AI and metrology, are leading to the integration of the three phases to form a seamless, automated end-to-end value chain.

In the mining industry, digitalization and automation are used across the value chain, from mine planning through mining and crushing operations to the extraction of minerals. Data collection, for example in mining equipment, enables advanced analysis to optimize processes and predict maintenance needs. We are the market leader in automated solutions for underground mining equipment.

Economic and political developments

Macro factors such as regionalization, political situation and cyclicality impact Sandvik. 2024 was characterized by financial and political uncertainty, with elections in more than 70 countries, and geopolitical tension.

Regionalization and protectionism affect trade regulations, such as customs duties or new legal requirements. Our global and local presence and our decentralized way of working allow us to be flexible and adapt to changing conditions. All of our business areas have action plans in place to manage changes in market conditions.

A growing middle class and rapid urbanization increase the demand for metals and minerals, the need for infrastructure investments, and the demand for consumer and industrial goods.

New technologies

A number of emerging technologies are affecting our industries. The rise of artificial intelligence is rapidly transforming the business landscape, with generative AI emerging as a powerful productivity driver that can perform increasingly complex tasks. Sandvik is investing in AI and machine-learning models across all its operations where applications include, for example, optimized component manufacturing, monitoring of tools or mining equipment, or the ability to identify a need for maintenance to avoid equipment breakdowns before they happen.

The expanding demand for battery-electric vehicles offers vast business opportunities for Sandvik within its mining operations but also headwinds in other parts of its business, for example in component manufacturing for the automotive sector.

Multi-axis technology, enabling the machining of a material from several different angles, improves efficiency and allows for products with, for example, more complex design.

Sustainability

The Paris Climate Agreement places demands on companies and society for change and new thinking. One consequence is the rapid electrification of society, increasing demand for electrification minerals and the need for fossil fuel-free energy sources. Sandvik is world-leading in electric mining equipment, and supplies tools and tooling systems for the energy industry, including renewable energy.

Sandvik has set a clear goal of reducing its greenhouse gas impact across the entire value chain. Our largest impact is through our products and solutions, and we continuously strive to increase productivity and minimize the environmental impact. We aim to increase circularity by using more secondary material in production. We repurchase customers’ used cemented carbide inserts, drill bits and rock tools and use them to manufacture new tools.

Today’s customers and stakeholders require ethical conduct from businesses and Sandvik is committed to the highest business standards.