China. Robot industry gets down to nuts and bolts

Domestically produced robots are shown at an international expo in Guangzhou, capital city of Guangdong province. China aims to have a relatively well-developed industrial robot industry by 2020,with three to five internationally competitive companies and eight to 10 supporting industrial clusters. LU HANXIN/XINHUA

Guangzhou-based GSK CNC Equipment Co, one of the leading domestic computer numerical control providers, estimates its industrial robot sales will double to over 800 sets this year and 3,000 sets next year.

The company expects that domestic demand for the robots will surge by as much as 20 percent annually in the coming years, said Jiang Miren, deputy director of the general manager’s office.

The domestic market has been under-performing in the past few years, with industrial robots used in only a few sectors, such as automobile and high-end electronic industries, he said.

But manufacturers are increasingly shifting to robots as they seek to improve efficiency and a new generation of laborers demand higher incomes and better working environments.

As the population ages, “the problem of the demographic dividend has yet to fully present itself,” Jiang said.

Zhang Lingyan, with research firm CCID Consulting, forecast in a report in February that “the use of industrial robots in China will grow by 16 percent year-on-year to 32,000 sets this year, with a broader spectrum of industries following the trend.”

The industrial robot sector will embrace opportunities in the coming three years from government support, the need for industrial transformation and the weakening demographic dividend, Zhang said.

The government aims to have a relatively well-developed industrial robot industry by 2020, with three to five internationally competitive companies and eight to 10 supporting industrial clusters, according to a guideline on promoting the sector issued by the Ministry of Industry and Information Technology last December.

Earlier this month, the government of Guangzhou, capital of Guangdong province, joined a number of cities in approving an ambitious plan for developing the industry. It aims to have annual output of over 100 billion yuan ($16.13 billion) from the intelligent equipment industry and annual capacity of 100,000 sets of industrial robots and intelligent equipment by 2020.

More than 80 percent of manufacturers in Guangzhou will be using industrial robots and intelligent equipment by 2020, with the demand for robots increasing by more than 30 percent annually in the manufacturing-heavy Pearl River Delta area in Guangdong, according to the Guangzhou Commission of Economy and Trade.

Currently, more than 90 percent of robots and their core parts must be imported.

As a manufacturing center, Guangzhou is embracing the increasing demand for robots with rising labor costs and a shortage of workers, according to He Zaihua, a researcher with market research firm CI Consulting.

The industrial robot industry of Guangzhou consists mainly of robot body manufacturing, relying on imports for controlling systems, motors and decelerators, He said, adding that the city work to develop the latter three areas to raise the overall quality of the industry.

The city government plans to build two or three robot industrial parks and have one or two key companies with their own brands and proprietary intellectual property rights generating annual output of 10 billion yuan each.

It pledged to work to promote the application of industrial robots in various sectors and to enhance policy support in terms of capital, land use and human resources.

Jiang of GSK CNC Equipment Co believes the sector could benefit from the government’s plan for a larger market, availability of more land and some financial support.

Besides better policies for drawing technology and talent and fund-raising, across-the-board platform serving companies in the industry, like the alliance for industrial robot manufacturing and application set up in Guangzhou in September last year, is also necessary, he said.

Robots made by domestic firms will gain a competitive edge in pricing, which will be half or even one-third of their foreign counterparts, He said.

He sees bright prospects for localizing industrial robots, which will be driven by technological and product upgrading.

Challenges to domestic companies will include the reliability, practicality and market recognition of their products, said Jiang, adding that they must differentiate their market positioning.

Jiang’s company has been allocating 8 to 10 percent of its revenue to research and development, with about 300 staffers engaged in robot development.

As enthusiasm continues to build, Jiang suggested that a cool head must be maintained over the industry to prevent speculative investment and future oversupply, with which he agreed.

The guideline from the Ministry of Industry and Information Technology pledges to guide local authorities in rationally identifying the mode and scale of the robot industry’s development and to promote differentiating development among localities.

 

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