David Fuller's view -
Robot executives paid close attention when Chia Day, a softly spoken senior vicepresident
at Foxconn, visited the Automatica trade show in Munich last week.
Mr Day has been given the task of fulfilling the Taiwanese contract manufacturer’s
dramatic vision of building a 1m-strong robot army to transform the productivity of
its labour-intensive electronics factories, which serve clients including Apple.
He is therefore an important potential customer for robot makers Fanuc and Yaskawa of Japan,
Switzerland’s ABB and Germany’s Kuka, which aim to tap markets beyond the automotive sector – for decades the foundation of the industry.
“Today there are 6m people working in the 3c [computer, communication and consumer electronic]
industry; that’s a market that has a relatively low degree of automation today. We see huge potential, comparable maybe to automotive 40 years ago,” says Till Reuter, chief executive of Kuka.
The four big industrial robots makers are easy to tell apart on the trade show floor: Kuka’s machines are orange, ABB’s graphite white, Fanuc’s yellow and Yaskawa’s are blue and white.
For years these four companies have dominated the market, controlling more than 60 per cent of industrial robot sales. But now their competitive environment is in flux.
New Chinese entrants such as Siasun and Estun are driving down the cost of robots, obliging some incumbents to lower prices too.
Google and Amazon’s recent robot company acquisitions signalled that Silicon Valley is preparing to barge into the market, and newcomers Universal Robots and Rethink Robotics have won plaudits for their lightweight, collaborative robots.
“We see Google, Universal and Rethink as a clear confirmation of the robotic trend, and they will help us open more markets,” Mr Reuter told analysts in March.
Robotics suppliers are now in an era of explosive long-term growth. Inevitably, this will lead to a steady increase in competition but demand, including upgrades, will almost certainly exceed supply for a very long time. Moreover, what can replace increasingly useful robots, other than even smarter robots?
See also: In Need of Disruptive Future, Dr Jacques Bughin for McKinsey Global Institute.
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