Industrial automation continues to progress, and nowhere is that happening at a faster clip now than in China.
Robots are making rapid headway in many plants around the world. Currently South Korea leads in adoption with some 531 robots per 10,000 workers in 2015, followed by Germany at 301, and the U.S. at 176. At 49 per 10,000, China lags, but is determined to catch up and surpass other nations. For the first time, in 2013 more robots were sold in China than anywhere else in the world. Last year, 90,000 robots were installed in China, fully one-third of the world’s total – all in an accelerating effort to counter higher labor costs.
The same fervor that made China a leader in solar panels and high speed rail is now embraced by its planners in the adoption of robots in factories. And everyone should be concerned.
China has an aging workforce and increasing labor costs, and industrial automation there is crucial. But as John Roemisch, a VP at robot manufacturer Fanuc America Corp. says, “There’s nothing keeping them from coming after our market.” As the CEO of IRobot adds, “China has a great history of being an effective fast follower… The question will be, can they innovate?” To that end, China has three enormous advantages: scale, growth momentum and money, according to a May 7th article in Bloomberg BusinessWeek.
Through a sweeping proposal released in China dubbed “Made in China 2025,” Beijing will focus on automating key sectors of the economy that include car manufacturing, electronics, appliances, logistics and food production. At the same time, they plan to increase their own production of robots to over 50% of total Chinese sales by 2020.
A Chinese start-up named E-Deodar has developed proprietary technology that allows it to create $15,000 factory robots, a cost about one-third cheaper than foreign ones. It has mastered technology for servomotors, drivers and control panels to gain a proprietary competitive advantage, and is said to act much like a Silicon Valley startup. Says it’s General Manager Max Chu, “People ask me, how long can you make robots?” he says. “I say it’s simple, we will make robots until there’s no more people in factories.”
The U.S. is not sitting idle. We’ve all seen the Roomba vacuums that promise to make domestic life a bit easier. China and others nations are now collaborating on building them for the global market. But while building vacuum cleaners is one thing — the industrial goal is here is much bigger. Amazon, for instance, hopes to build logistics systems that create near-humanless warehouses with packages delivered by drones or driverless vehicles. JD.com is rushing to automate its business in the quest to replace tens of thousands of warehouse workers and deliverymen. It’s currently testing drones to deliver packages in rural regions and experimenting with robots to deliver on college campuses, according to Bloomberg.
As its Chief Technology Officer said recently, it’s all about “who can learn… who can get better faster. We are all just starting out.”
But while this might be the most disconcerting part of all for today’s low-skill worker, an interesting — and completely opposite — counterpoint has been voiced by Wall Street Journal editor Greg Ip. We’ll provide Ip’s counterpoint in our next and concluding post on the ascendance of robots. Stay tuned…