Original | Text by BFT Robot
China’s robotics market and automation landscape have never been more exciting than this year. Last year, more than half of the world's industrial robots were sold in China. In the first half of 2023, China's robot demand trend continues to rise. According to estimates, the number of industrial robots sold during this period is approximately 145,000 units, an increase of 17.1% compared to the previous year.
The Chinese market is leading the basic trend of industrial automation. Technologies and applications that first appeared in electronic product manufacturing are expanding to areas such as electric vehicles, batteries and photovoltaics, and continue to play an important role. As China leads in these fields, local companies benefit from competitive advantages brought about by economies of scale and learning effects, which enable Chinese companies to better adapt to market demands, improve production efficiency, and drive the entire industry forward.
Growth momentum needs
Although the peak of new electric vehicle production capacity has passed, projects in this field are still the main force in robot sales. Electronic product manufacturing, the most important sales area before 2022, is being affected by suppressed domestic consumer demand and the transfer of large-scale production capacity to Southeast Asia. Market observers expect solar panel production capacity to more than double from 380 gigawatts in early 2022 to 750-800 gigawatts by the end of this year. Energy storage facilities near wind or solar parks are becoming another sales market for cells.
In recent years, domestic manufacturers have increasingly ventured into areas that were previously accessible only to foreign robot manufacturers. For example, Eston, the country's leading multi-axis industrial robot manufacturer, sold more than 17,000 robots in China last year, less than FANUC and KUKA, but more than ABB and Yaskawa. In the SCAR field, Inovance has significantly captured the market share of Epson and Yamaha. Important reasons for the success of China's rising stars are the delivery delays of international market leaders and the ability to quickly adapt to new market trends and develop scalable solutions for growth areas.
The Chinese government’s strong emphasis on broad-based STEM education is bearing fruit. Compared with Europe, developers and system integrators in China have more professional talents. Coupled with the emergence of local supply chains in recent years, the product cycles of machine vision, industrial robots and collaborative robots have been shortened and costs have been significantly reduced.
Leading foreign companies are also increasingly relying on local supply chains. At the end of May this year, the second phase of the expansion project of KUKA’s new factory in Shunde opened. The factory is the largest robot production base in South China. The expansion project of Fanuc's Shanghai factory was completed in July. It is the company's most important production base outside Japan.
The impact of China’s economic weakness
Due to cutthroat price competition, the trend of Chinese manufacturers struggling to go abroad continues. Collaborative robot manufacturers JAKA, Dobot and Aubo all plan to go public. JAKA hopes to raise 750 million yuan this way, a large portion of which will be invested in international expansion. To hedge against growing geopolitical risks, Chinese parts manufacturers are establishing production bases in Southeast Asia, Europe and North America. For example, Leaderdrive, a leading domestic manufacturer of servo and robot gears, has invested in building production capacity in Mexico.
Citation: Stiller Database
However, even the robotics industry cannot escape the current weakness of China's economy. According to surveys, in the first half of this year, a total of 95 financing transactions occurred in the robotics industry, with a total amount of 8.655 billion yuan. Most of this was invested in drones, machine vision and medical robots, followed by investments in key components and multi-axis robots. The total amount was down 33% from the same period last year, consistent with a general decline in venture capital deals. Venture capital deal value across all industries in Asia fell 42% in the first half of 2023. Thus, in the field of robotics, China lags behind the United States ($1.48 billion) but is higher than the amount of corresponding financing activity in the EU ($650 million).
Considering the prospects for robot sales, there will be huge challenges ahead: According to Fanuc reports, China's inventory levels reached unprecedented levels at the end of July. The company did not release detailed figures for its robotics division, but the group's total orders in China fell 42% compared with last year. According to company president and CEO Kenji Yamaguchi, the company does not expect order volumes to return to normal until 2024, and possibly later. The numbers for other heavyweights in the industry are similar in China: Yaskawa Electric Group's orders in China fell 27% in the second quarter, and ABB's orders in the robotics field fell 37%. Leaderdrive's sales fell 44% in the first six months of the year.
Judging from August's economic data, this may not be the lowest point yet. The adjustment process can be difficult, and for many less efficient companies, it can be an existential challenge.
A bright future still exists
A strong robotics industry is an important part of the Chinese government's modernization efforts, and leading companies will continue to receive corresponding support. In August this year, the Beijing Municipal Government invested 10 billion yuan to establish related funds. In the medium term, more efficient artificial intelligence will significantly expand the scope of applications. To this end, Huawei established a robotics subsidiary in June with a registered capital of 870 million yuan.
In the foreseeable future, China will remain the largest market for robotics and automation products. Currently, China has a strong supply chain for most key robotics components.
Article | Thirteen
Typography | Spring Flowers
Review | Cat
If you have any questions about the content of this article, please contact us and we will respond promptly. For more information, please pay attention to BFT intelligent robot system~