Technology has long played an important role in work and has become the major driver for success and failure in a growing number of industries. A study of more than one million patents issued over the past 100 years shows that technological advancements have a positive impact on the economy. The study confirms that the pace of innovation is a disruptive force between competitors. Companies that lagged behind their industry’s innovative pace saw their annual growth over the next five years slow by as much as 2.5 percentage points. But the study also found that periods of rapid technological innovation lead to a measurable increase in overall productivity and economic growth.
One of the major technological innovations in the past 30 years is the use of robots. The first uses of modern robots were in factories as industrial workers. They were simple fixed machines capable of manufacturing tasks which allowed production with less need for human assistance. Industrial robots have been built since the 1970s, and digitally controlled robots since the 2000s. At present, the robotics market is growing rapidly, an estimated 18 percent CAGR in 2017.
One of the most promising new segments of the robotics markets is that of the collaborative robot (cobot). A cobot is a robot fitted with advanced sensors, intended to physically interact with humans in a shared workspace. In contrast with other robots, designed to operate autonomously or with limited guidance, cobots are designed to assist humans in the performance of their tasks – i.e., to work jointly on a project. Because cobots are almost plug and play, and very low cost, they are also affordable for small- and medium enterprises and the segment is quickly growing. Cobotics (collaborative robotics) is emerging as a new path to productivity growth, with robots complementing the workforce rather than replacing it. Besides low costs and high flexibility, there are many reasons for the emergence of cobots: they are fit to handle ergonomically challenging tasks, to work alongside humans in small-spaced assembly lines, they are affordable and easily trainable, and they can be used to offload repetitive and boring jobs.
Cobots were at first mainly looked at for manufacturing complex parts in the automotive and aerospace industries, combining the precision and speed of robots with human employees’ intelligence to think and adapt. Current uses for cobots also include machine tending, material handling, counting, inspecting, and packaging, and more uses are continually being discovered. Cobots are collaborative by design and are, or soon will be, fit for a vast number of uses. Offices, homes, labs, warehouses, farms, distribution centers, hospitals and healthcare facilities are all starting to use cobots to help them do their jobs better.
Because prices for sensors and computing power continue to fall, prices for cobots continue to decrease as well. Therefore, many experts describe cobots as being the evolution of industrial automation, or even the catalyst for the 4th industrial revolution. Expectations for the cobot market are high. Researchers from institutes like IFR, Loop Ventures, Barclays Research, Boston Consulting Group, and others, all expect the cobot market to grow rapidly and become a multi-decade above-average growth market.
1. Cobot Industry
1.1 Industry Definition and Report Scope
The robotics market is currently segmented into two main categories: Service robots and industrial robots. An industrial robot is a robot system used for manufacturing. The International Organization for Standardization (ISO) has developed a specific definition of a general manipulating industrial robot operated in a manufacturing environment: “an automatically controlled, reprogrammable, multipurpose manipulator programmable in three or more axes, which may be either fixed in place or mobile for use in industrial automation” (ISO-8373). Typical applications of robots include welding, painting, assembly, pick and place for printed circuit boards, packaging and labelling, palletizing, product inspection, and testing; all accomplished with high endurance, speed, and precision. Most types of industrial robots fall into the category of ‘robotic arms’.
A cobot is different in a number of ways. It is intended to physically interact with humans in a shared workspace, in contrast with other robots, which are designed to operate autonomously or with limited guidance, which is what most industrial robots did until the 2010s. Whereas ‘traditional’ industrial robots are often physically shielded from interaction with humans, cobots will in general be less ‘fenced off’, or not at all. And, unlike traditional industrial robots, which require specialized programming skills, cobots are simple to program and can also learn independently, and are relatively easy to move and to utilize at other points on the production chain.
This report examines the current and expected market environment for the cobot industry, proceeds with a market overview and a qualitative analysis of the market. It looks at the most important growth drivers, possible impediments and emerging opportunities and market trends. It analyses the market with the help of Porter’s Five Forces, highlights M&A trends and funding activities (IPOs and VC). Thereafter, it continues with an in-depth look at the different market segments from an end-user perspective, as well as from a regional perspective, and it looks at segmentation per cobot application. Finally, it explores the manufacturing landscape and takes a closer look at a number of major cobot manufacturers.
1.2 Executive Summary
The market for cobots is emerging as a fast-growing segment of the rapidly growing industrial robotics market. Demand for cobots is expected to rise at a CAGR of more than 50 percent over the next decade. Although there are some reasons to assume that the acceptance and implementation of cobots will slow growth somewhat, it is clear that the cobot market is rapidly expanding and the number of use cases will continue to rise. The steadily falling prices of components such as sensors make cobots accessible for SMEs.
All markets are expected to see growth rates above 50 percent CAGR, but in a regional sense, expectations are especially high for China, because it still lags in the use of robots, when compared to countries like South Korea, Japan, the US, and Germany. The size of the Chinese market, and the relative inaccessibility for non-Chinese companies, will give domestic manufacturers an advantage. However, most innovation is still taking place outside China. Markets in Asia Pacific, North America, and Europe are forecasted to have the highest growth, with South America and Africa lagging behind.
For industrial cobots, the automotive market will remain the most important, but other manufacturing industries such as furniture & equipment, metal & machinery, food & beverage, and pharmaceutical, are expected to significantly drive the cobot market over the next decade.
Use cases for cobots are being discovered in a wide range of industries. In some, they replace traditional industrial robots used for packaging, assembly, inspecting and dispensing materials, but for many industries, cobots will be the first experience with the use of robots. A number of recent developments in areas like material handling, assembly and dispensing, have made a much wider use of cobots possible.
The industry witnessed a first wave of acquisitions in the period 2015-2017, when traditional manufacturers of industrial robots have jumped on the bandwagon. In the near future, we see further consolidation, because the many startups will not grow quickly enough to remain competitive and profitable. Another trend is the appearance of ‘outsiders’, like Teradyne (TER) and Hanwha Techwin (OTC:HNWHF), in the cobot market.
2. Market Environment
2.1 Prospects for the World Economy in 2017- 2018
According to the World Bank, global growth is firming, contributing to an improvement in confidence. The recovery in industrial activity has coincided with a pickup in global trade, after two years of marked weakness (Fig 1). In emerging markets and developing economies (EMDEs), obstacles to growth among commodity exporters are gradually diminishing, while activity in commodity importers remains generally robust. As a result, and despite substantial policy uncertainty, global growth is projected to accelerate to 2.7 percent in 2017, up from a post-crisis low of 2.4 percent in 2016, before strengthening further to 2.9 percent in 2018-19.
Activity in advanced economies has gathered momentum in 2017, supported by an upturn in the US, as previously anticipated. In the eurozone and Japan, growth forecasts have been upgraded, reflecting strengthening domestic demand and exports. The recovery in global trade coincides with strengthening investment, which is more import-intensive than other components of aggregate demand.
However, the world economy continues to face a number of downside risks. Structural headwinds, including slower trade liberalization and value chain integration, as well as elevated policy uncertainty, the possibility of financial market turbulence, and over the longer run, weaker potential growth, continue to weigh on the outlook for trade. These risks highlight the urgency for policymakers in emerging markets and developing economies to rebuild macroeconomic policy space and implement policies that support investment and trade.
The analysis of the World Bank reveals several opportunities for further growth of the cobot market. Increasing demographic pressures will limit labor supply, especially for physically demanding jobs, and a growing trend of insourcing manufacturing will receive another boost, because of the low costs of cobots. This opportunity for developed nations to ‘bring manufacturing home’ will further accelerate the adoption of cobots in these countries the coming years.
2.2 Outlook of the World Economy to 2030
Global GDP is expected to increase by 2030, but the gap between the richest and poorest economies will stay almost the same. The comparison between 1970 and 2016 shows that global growth has almost doubled, with average world GDP, per capita, growing from around USD5,000 to over USD10,000. The projected growth for 2030 sees world per-capita GDP rising to around USD14,000.
The US continues to grow, consistently well above the global average, maintaining its status as one of the world’s largest economies. The data predicts China will continue growing, but by 2030 it will still be below the world average. India’s growth has been much slower than China’s, meanwhile, but is forecast to increase over the next 14 years. The shift in global economic power away from established advanced economies, especially those in Europe, towards emerging economies in Asia and elsewhere, will continue. Today’s advanced economies will continue to have higher average incomes, but emerging economies should make good progress towards closing this gap, with the poorer ones continuing to lag behind. Africa, for example, sees steady but considerably slower growth than the rest of the world, with much lower levels of per-capita GDP across the continent. Countries that lack the knowledge and infrastructure to support modern manufacturing, will face nearly insurmountable challenges in convincing foreign manufacturers to keep investing in their country, when production costs at home are lower.
A PwC-report projects annual global economic growth to average around 3.5 percent over the next four years to 2020, slowing down to 2.7 percent for 2021-2030. Looking forward, the global economy faces a number of challenges to prosperous economic growth. Structural developments, such as aging populations and climate change, require forward-thinking policy which equips the workforce to continue to make societal contributions later on in life and promotes sustainable development. Cobots will play an important role in keeping people in the workforce until a higher age, especially in countries with aging populations, and they will also become more important in industries like leisure, health- and daycare. They will be used in the energy sector, for assembling and maintaining solar panels and windmills in extreme environments. Autonomous vehicles will help people to stay active longer and will drastically alter the world’s transportation systems. Cobots will contribute to making sustainable development a reality.
Falling global trade growth, rising inequality and increasing global uncertainties are intensifying the need to create diversified economies which create opportunities for everyone in a broad variety of industries. Cobots will put extra pressure on developing nations to adapt, because they will lose one of their economic advantages, cheap manufacturing costs, as developed nations will implement cobots in manufacturing in their home markets, in order to avoid rising inequality and unemployment in their own countries.
3. Market Overview and Qualitative Analysis
3.1 Market Structure
The cobot market is characterized by a fast-growing number of both suppliers as customers, creating a rapidly moving and competitive market. The market is global, with the main markets in, and manufacturers from, East Asia, North America, and Europe. The barriers for entry and exit are relatively low in the cobot market, when compared with the industrial robot sector. This is because cobots are generally smaller and cheaper than industrial robots, and more ‘off-the-shelf’ components can be used in production. Because it is a fast-growing market in many different segments, there is a large influx of specialized startups that build upon the foundations created by established companies in the cobot industry. However, successful startups are often acquired by the leading cobot manufacturers, who in turn have been acquired by larger, traditional robot firms, who have entered the market in full force in the past two years, after a few years of hesitation. Other market participants are emerging, such as Internet providers and online retailers (Amazon, Alibaba) who buy or develop robots and combine them with new business models, e.g. in logistics or customer service.
3.2 Market Overview
Over the past 10 years advancements in robot technologies have been enormous. The industrial market has been the primary adopter of robot technology and accounted for the majority of all funding on robotics. The industrial robot market is defined as robots used in manufacturing or assembly applications within automotive, electronic or other machining industries. Largely due to the size and power of most industrial robots in use today, these systems are typically installed in caged environments with minimal human contact for safety reasons. Spending on robots among industrial companies has increased considerably and will continue to climb over the next decade.
According to the International Federation of Robotics (IFR), sales in service robots for professional use will increase 12 percent by the end of 2017 to a record of USD5.2bn. The sales forecast for 2018-2020 expects an average growth rate of 20 to 25 percent and a cumulative volume of around USD27bn for the professional service segment.
Robots for medical, logistics, and field services are the most significant contributors. Research from the Boston Consulting Group (BCG) shows that the portion of tasks performed by robots will grow from the current 10 percent to near 25 percent by 2025, for all manufacturing industries worldwide. For some industries, more than 40 percent of manufacturing tasks will be carried out by robots. This development will power dramatic gains in labor productivity in many industries around the world and lead to shifts in competitiveness among manufacturing economies as fast adopters reap significant gains. Growth is expected to accelerate even further with the robot market growing to USD73bn by 2025, representing a 14.9 percent CAGR. These forecasts only factor in hardware sales and do not account for software or other supporting services. When factoring in these additional costs, the market value could easily be about three times larger.
Cobots took most manufacturers by surprise and end users were even slower to catch on to the massive potential that cobots presented to their businesses. The world’s first cobot was installed in December 2008 at Linatex, a Danish supplier of plastics and rubber for industrial applications. Since then, cobot sales have been rising dramatically. According to Barclays, 2,500 units were sold in 2014, 4,300 in 2015 and 10,100 units sold in 2016. Cobots are the fastest-growing segment in the automation universe. The cobot market is expected to grow from around 5,000 units to 150,000 units in 2020 – for a total USD3.1bn global market. The estimated growth rate is more than 50 percent CAGR for the period 2017-2022.
According to some estimates the actual sales number in 2015 was 3,675 units, and 8,950 in 2016. In 2016, cobots only represented three percent of industrial robots sold. In 2017, it is estimated that sales of robots working collaboratively will represent five percent of global robot sales. This would point to a sales volume of approximately 18,000 units. Loup Ventures estimates that the number for 2017 will be 22,745 units and forecasts more than 130,000 cobots will be sold in 2020.
3.3 Major Growth Drivers
The primary driver behind the rapid growth in robots are innovations in digital technology and connectivity. Manufacturing is being transformed as digitalization and connectivity transform machines and factories worldwide. This meshing of the digital world with machines as the Internet meets production is called the Fourth Industrial Revolution, or Industry 4.0. It revolves around the concept of combining automation and data in manufacturing to create “smart factories” by bringing together computing, the Internet of things, AI, and cobotics – humans and machines working together. Industry 4.0 will revolutionize manufacturing, with factories operating almost autonomously and generating huge efficiencies.
There are four trends in particular which have emerged over the past 20 years: PC technology has become part of robotics, just like sensor technology - and in particular, motion-sensing capabilities and image-processing capabilities- and enormous strides have been made in terms of performance, precision and technical reliability. Just as important is that prices for these technologies have plummeted.
Prices of hardware and enabling software are estimated to drop by more than 20 percent over the next decade. At the same time, the performance of robots will improve by around five percent each year. As robots become more affordable and easier to program, a greater number of small manufacturers will deploy them and integrate them more deeply into industrial supply chains. Advances in vision sensors, gripping systems, and IT, meanwhile, are making robots smarter, more highly networked, and immensely more useful for a wider range of applications.
The developments in technology not only drives the price of components down, it also makes rapid improvements on issues like recognizing emotional states. Today, the emerging category of AI—artificial emotional intelligence, or emotion AI—is focused on developing algorithms that can identify not only basic human emotions such as happiness, sadness, and anger but also more complex cognitive states such as fatigue, attention, interest, confusion, distraction, and more. When this technology is deployed in cobots it will greatly improve their efficiency and acceptance by the general public, further accelerating their deployment into new use cases.
The Danish Technological Institute has been developing and testing a variety of cobot solutions, and has considerable experience with the implementation of new robot technologies. The DTI sees five reasons behind the growth of cobots and why companies – both large and small – should be exploring their adoption:
3.4 Market Restraints and Challenges
The major challenges for the cobot market in the automotive industry are safety concerns, technological difficulty of improving payload capacity & speed of cobots, and low penetration and acceptance rates of industrial cobots.
There are more than 1.4mn ‘traditional’ active robots in use and as few as 27 fatal accidents in the past 30 years. This is a very good safety record, and it remains to be seen if cobots can equal that performance. While cobots were rapidly gaining acceptance, there were no standards regulating their use until January 2016, when an international technical specification (ISO-TS-15066) was released. This document listed all body parts’ pain limits and translated this data into robot settings. The new standard is still a technical specification, which means that the numbers are only guidelines. It is expected to be formally adopted in the next couple of years. Safety guidelines such as ISO-TS-15066 should help US, European, and Asian robotics regulatory development without interfering with cobot adoption and will help pave the way for safely incorporating this rapidly rising technology into the workforce. Despite the current lack of regulations, cobots have many safety features already built in. Their moving joints are typically covered with spongy, shock-absorbing cushions, sensors located across the cobot arms and base react to humans nearby, and many are programmed to stop moving completely when they are touched, and they are programmed to avoid wide swings and sudden moves outside of their work radius. So far, no serious accidents with cobots have been reported.
Another restraint is that the use of cobots can make things more challenging at first in the planning and deployment process. Progress still needs to be made to simplify the planning processes by supporting the planning of cobot applications with IT tools, and automating it in some cases. Another topic for improvement is the setup or programming of cobot systems through dialog systems, which integrate graphic programming, tactile guidance and speech. And although cobots are relatively simple to implement, a thorough risk assessment is required to define need for safety measures, and customers can be surprised by the need for expensive fencing. Safety precautions can result in very low operating speeds or multiple stops if a human is detected in a work cell. Other required safety precautions can significantly increase integration costs.
Cobots are still fairly limited in some respects, and this fact has been impeding the overall rate of adoption. Since they are designed to work hand-in-hand with a human counterpart, cobots are limited to working at near-human speed in order to maintain a safe work environment. Also, current cobots still have a limited reach, payload, speed and accuracy, and collaborative work cells mean operators are still required, and need to be trained. Moreover, there are also certain materials that cobots struggle to handle, making them unsuitable for certain tasks. Soft materials such as cloth do not provide sufficient tactile feedback, and cannot be handled adeptly by machines. (Although, there are companies working on improving robotic grippers such as Soft Robotics and Shadow Robot Company). Further technological innovation to enhance mobility and cognition—especially in the area of unsupervised learning—will be required to allow manufacturers to incorporate cobots into more complex and unstructured manufacturing environments.
If we look at Gartner’s emerging technology hype cycle, we can see several components or overlapping technologies near the ‘peak of inflated expectations’ and closing in on the ‘Trough of disillusionment’. When comparing the research from Barclays (NYSE:BCS) with that of Loup, we can already see some diminished sales projections. Security risks associated with connected devices and the IoT, like software-bugs and hacking, might lead to slower implementation, at higher costs than was foreseen in earlier research.
3.5 Emerging Opportunities and Market Trends
While the cobot market is relatively small today, with an estimated sales value of USD680mn in 2017, this sub-category of the industrial market will see extraordinary growth over the next 10 years. Part of the reason is cost, which is expected to decline three to five percent annually through 2022. The cobot market is estimated to grow from 2,500 units in 2014 to 368,000 units in 2022 – for a total USD7.1bn global market. Loup Ventures sees cobot shipments increasing from 8,950 units in 2016 to around 239,000 by 2022, representing a market value of some USD5.8bn. In their 2017 Worldwide Robotics Predictions report, IDC forecasted that by 2018, 30 percent of all new robotic deployments will be cobots.
The market is expected to soar even further beyond 2022. Expectations are that the industrial robot market will nearly triple in less than 10 years and that cobots will account for a third of that market. The value of the cobot market is estimated to be between USD9bn and USD12bn in 2025. According to some estimates, the cobot market will be worth USD9.5bn by the end of 2024 and will grow at a CAGR of 30 percent from now until then.
At the moment, the cobot market is dominated by a small number of manufacturers, with a ‘ring’ of start-ups, who often specialize in different segments of the market, surrounding them. The continuous developments and strong demand will most likely lead to additional investments in the cobot market and the rapid growth of use cases for cobots will attract new entrants to the market. These companies are heavily driven by technology and will conquer new markets. The new market participants will be both small companies, exclusively aimed at the cobot market, and large companies that use the cobot technology in their existing business-processes and combine them into new business models, e.g. in logistics or customer service. Online retailers with big warehouses, such as Alibaba (BABA) and Amazon (AMZN), are examples that come to mind.
Product differentiation will not necessarily be achieved with advancements in ‘core-hardware’, but could also prosper with complementary services like specialized software and/or physical add-ons. Technological advances and competition among suppliers continues to push prices of components and software down, making cobots more accessible for SMEs in different segments of the market.
The growth of the cobot market has important repercussions for the industrial IoT (IIoT), because cobots are typically equipped with far more sensors and produce more data to be processed and analyzed than their assembly- line counterparts. Their mass deployment in factories will create a new focus among factory owners on edge computing to support them all. Getting the most from them will demand a new focus on AI and machine learning techniques. The stream of data these sensors and connected devices will generate will be a rich source of business intelligence. Data analytics yields new findings, which in turn can be fed back into machines and systems to make them more efficient, powerful and reliable. The findings can also be translated into new services and business models as well as opportunities for companies that make sensors and IT for data centers. Samsung Electronics (OTC:SSNLF), SEMCO, and SK Hynix (OTC:HXSCL) are three Korean companies who should benefit from the explosive growth in cobot use.
The rise of the flexible cobots can also have major effects on plant layouts. Production lines were traditionally straight lines with conveyors, but cobot technology permits more flexibility for customers to split lines, or even eliminate between-machine conveyors.
An interesting feedback loop takes place in the components sector. The global machine vision market is expected to reach USD19.22bn by 2025. The global machine vision technology market was valued at USD9.1bn in 2016 and is projected to grow at a CAGR of 8.5 percent from 2017 to 2025. The ability of machine vision systems to process a large amount of information in a fraction of seconds is a major factor driving the market growth. It is paving the way for manufacturers to achieve new milestones in manufacturing products with negligible defects. Moreover, the increasing adoption of cobots across industrial sectors is leading to the application of vision-guided cobot systems, and will fuel demand for machine vision systems and other components.
3.6 Porter’s Five Forces Analysis
We utilized Porter's ‘five forces’-framework to analyze the strategic landscape of the cobot marketplace:
Threat of new entrants (moderate-high): When compared with the industrial robotics market, the threat of new entrants in the cobots market is higher, as can be witnessed by the growing number of startups. Approximately one-third of all cobot manufacturers can be considered a startup, often in areas that are new to cobots, such as healthcare and agriculture. Start-up costs can be relatively low, and certain types of cobots can be built with off- the-shelf materials, as is happening in China frequently. New market segments are opening up and attracting startups with differentiated products and services as well. Established manufacturers have an advantage in terms of innovation, that can be protected with patents. However, later entrants can often avoid research costs and deliver the same cobot (at least the hardware) for a lower price. Existing producers are in a better position to exploit economies of scale in a price-competitive market. The existing sales network they have is another advantage. The rapid growth of the cobot market will attract newcomers who will find a large’ first-time’ customer base. This will benefit newcomers because these customers will not have existing relationships with current manufacturers. In some countries, most importantly China, regulations hinder the entrance into the market by non-Chinese companies.
Power of buyers (high): Demand from end-customers is high and there are many buyers. Many cobot startups are aiming at a particular segment of the market, driving differentiation and upping the importance of the individual buyer in the sub-segment. In contrast to the industrial robot industry, orders are smaller and there is more price sensitivity. However, once a choice for a certain type of cobot is made, switching costs will be relatively high.
Power of suppliers (low-medium): Most suppliers are not dependent on the cobot industry. Processing power and sensors are used in many different industries, that often dwarf the entire robot market. However, due to many factors, many components are becoming cheaper and more generic, and competition among suppliers is fierce. This diminishes the power of suppliers.
Threat of substitution (low-medium): In the cobot market, the main substitutes are human labor and/or industrial robots. However, in most cases the mix of human labor and cobots delivers higher productivity at lower costs. There might be a threat from low levels of acceptance of cobots by society, although this is unlikely.
Competitive rivalry (low-medium): In the cobot industry the number of competitors is growing rapidly, but it is unclear how many of them will acquire enough capital to ramp up production and to invest in R&D. Economies of scale will be in the advantage of larger manufacturers with a well-established salesforce. Many smaller companies will struggle to become and remain profitable in a competitive market. This opens the door to acquisitions of small and promising companies by larger players. The market is showing signs of high differentiation, with many new customers to be discovered. This offers manufacturers ways to distinguish themselves and lowers the competitive rivalry.
3.7 Key M&A Trends and Strategic Partnerships
In the past few years, a number of promising cobot startups have been acquired by larger companies, a trend that will continue going forward. Promising startups often lack the capital to scale out, and many established robot suppliers are scrambling to enter the cobot market. After a few years of hesitation, all major robot companies have now embraced the cobot market.
In 2015, Danish startup, Universal Robots, was acquired by US-based Teradyne. Teradyne is a newcomer in the cobot market and had been evaluating new, high-growth technology platforms, fielding increasing requests from customers to automate the manual processes around its testing offerings, and was also seeking to diversify business by entering new markets. Speed to market was a driving force behind Teradyne’s decision to acquire, rather than develop its own cobot solution. Teradyne has secured internal cobot expertise and diversified its business, and it can now quickly capitalize on pent-up demand.
Teradyne has no intention of moving up the chain to compete with the big four — ABB (ABB), KUKA (OTCPK:KUKAY), FANUC, and Yaskawa (OTCPK:YASKY) — in the heavy industrial robot market. It is clear, however, that more and more of these companies are gradually penetrating the cobot market with their own commercial offerings.
Early in 2015 ABB acquired Gomtec, a start-up producing a one-armed cobot named Roberta. Adept Technology, a multinational corporation with headquarters in California, was acquired by Japan’s Omron (OTCPK:OMRNY) in October 2015. The company focuses on industrial automation and robots, including software and vision guidance. Adept has offices throughout the US as well as in Germany, France, and Singapore.
KUKA Robot Group, headquartered in Germany, is one of the global Big Four producers of industrial robots, and was acquired by the Chinese robot company Midea in early 2017. Despite the German government’s initial reservations, the deal was eventually approved by the European Commission. Not long after that, Beijing-based Jianguang Asset Management bought the Standard Products unit from NXP Semiconductor (NXP)for USD2.75bn. Standard Products was renamed Nexperia and is based in the Netherlands. China plans to upgrade its economy by encouraging the domestic production of cobots. To that end, the country’s latest five-year plan simplifies regulations around the acquisition of foreign companies, and more acquisitions are to be expected.
3.8 IPO and VCI in the Global Industrial Robot Market
2016 was a busy year for funding of cobot-related startups. 128 companies got funded, some of them multiple rounds. Total funding was USD1.95bn, 50 percent more than 2015. 2017 is having significant funding activity as well.
Velodyne, a producer of LIDAR systems, raised USD150mn in funding from Ford and Baidu, in August 2015. The company produces sensors for autonomous vehicle systems, industrial applications and 3D vision for UAVs and cobots. Financers were Ford and Baidu.
In 2017, Danish investors funded On Robot, a manufacturer of grasping devices, and OptoForce, a producer of Torque sensors. The companies will use the funds to continue developing technologies around cobots.
In April 2015, Rethink Robotics completed its Series D financing round, bringing total funding to USD113.5mn. In March 2017, the company raised USD18mn in new funding as part of its Series E financing round. The new round includes funding from leading asset manager and private equity investment firm, Adveq, as well as contributions from all previous investors, including Bezos Expeditions, CRV, Highland Capital Partners, Sigma Partners, DFJ, Two Sigma Ventures, GE Ventures, and Goldman Sachs (NYSE:GS).
Life Robotics is a Japanese cobot company. The company has taken in a total of USD13.4mn in funding in 2016, from backers that include Koden Holdings, Japan’s leading industrial economics manufacturer, Mitsubishi UFJ Capital, and Omron Ventures, the automation/robot giant.
Starship Technologies builds autonomous cobots designed to deliver goods locally, and announced in January 2017 that it had secured USD17.2mn in seed funding. The funding round was led by Daimler AG, along with Shasta Ventures, Matrix Partners, ZX Ventures, Morpheus Ventures, Grishin Robotics, Playfair Capital and a number of other investors. Daimler is currently running field tests in which a fleet of Starship delivery robots are deployed from vans for last mile deliveries.
In October 2017, Veo Robotics, an American startup creating intelligent, human-aware systems for industrial robotics, raised USD12mn in Series A funding. Lux Capital and GV, formerly Google Ventures, led the round, while previous investor Next47 also contributed to the funding. Veo earlier raised a USD1mn seed round from Next47.
4. Global Market Segmentation by End-user
4.1 Market Overview by End-user
The future cobot market can be divided in five distinct categories:
Industrial: Cobots used in manufacturing applications in verticals such as automotive, electronics, metals and machinery, and plastics and rubber.
Commercial: Cobots used in all commercial applications outside of manufacturing including warehousing, healthcare, agriculture, construction, security and public safety.
Domestic: Cobots used to perform household chores; for example, vacuuming, mopping and mowing.
Military: Ground and marine cobots used in intelligence surveillance and reconnaissance (ISR) applications, bomb disposable and cargo transportation.
Social and Entertainment: Cobots used as toys or personal companions.
The automotive industry leads the end user industry segment of the global cobot market and captured the largest market share in 2016. As the cobot market matures, fast growth in all of these categories is to be expected. Especially for the ‘social and entertainment’ consumer-market expectations are also high. For industrial cobots, the automotive market will remain the most important, but other manufacturing industries like furniture & equipment, metal & machinery, food & beverage, and pharmaceutical, are expected to significantly drive the cobot market over the next decade.
In many of these industries, manufacturers are facing increasing demand for custom, individualized products, for the low cost per unit found in mass production. This development is evident in the automotive industry, with car manufacturers offering a vast amount of ‘niche’ products, but also in the electronics industry, and increasingly in merchandise like clothing, shoes, furniture and other products. This has led to ‘mass customization’, the use of computer-aided manufacturing, where cobots play a major role.
4.2 Industrial Cobot Market in Vehicle Manufacturing
The history of robots is tied to the automotive industry. From the 1970s, the whole automotive industry was characterized by the comprehensive use of large robot systems in their production lines. Today, customers increasingly demand their cars to be customized and batch sizes in production are becoming smaller. For car manufacturers and all their suppliers, this means they have to be prepared for quick changes in their production layout. And many manufacturers in the car industry have great interest in cobots because they can automate the final assembly, the part that is most labor-intensive.
In November 2016, Audi (OTCPK:VLKAY) presented a new production concept which embraces a modular and mobile approach of assembly in order to face the high complexity of new product varieties and continuous integration of new processes into production. Besides automatic guided vehicles (AGVs), flexible lightweight cobots also play an important role in their vision of the future factory.
India-based Bajaj Auto, third largest motorcycle manufacturer worldwide, decided to integrate more than 100 cobots into their production, because two-wheeler assembly lines are highly labor-intensive, spatially challenged, and they have physically taxing movements that require high-end precision.
Nissan Motor (OTCPK:NSANY) is facing an aging workforce and a loss of vital skills. One issue causing problems for the Yokohama plant were overrun cycle times. By installing two lines of UR10 cobot arms, Nissan solved two problems: the company’s cycle time overrun problem is a thing of the past while the amount of heavy lifting has been significantly reduced for the staff.
Not only manufacturers, but also their suppliers increasingly count on cobots. Just as an example, one of the world’s largest OEM parts suppliers, Continental Automotive (OTCPK:CTTAY), has installed six cobots automating the handling of PCB boards in the production of car instrument panels with three additional UR10 projects underway.
4.3 Industrial Cobot Market in Component Manufacturing
Industrial robots have become key elements in the manufacturing industry. Once a slow-growing component of the manufacturing production chain, robot production has surged in recent years, spurred by demand from the manufacturing sector. The low barrier to adoption, cost-wise, means that small to medium-sized players – 70 percent of global manufacturing - are poised to benefit from this new technology. With this new ability to scale automation, smaller manufacturers can now compete with rival factories in developing countries with substantially lower production costs.
In component manufacturing, cobots are used in several innovative ways. Voodoo Manufacturing in Brooklyn, N.Y., runs a growing 3D printing farm scaling up to handle large production runs to compete with injection molding. The startup needed to automate the manual loading and unloading of plates in their printers and selected a cobot arm because of its quick integration with peripheral systems. The cobot is helping Voodoo take 3D printing from a technology mostly used for producing prototypes and high-value components to become an alternative to the mass production of plastic parts done through injection molding, a more cost-intensive production process. The cost of implementing a cobot was approximately five times less expensive than a traditional industrial robot.
4.4 Industrial Cobot Market in Other Automotive Sectors
Continental, a multinational automotive manufacturer based in Germany was able to reduce its changeovers by 50 percent after acquiring cobots to automate how PCB boards were manufactured and handled. The changeover times fell from 40 minutes when performed manually down to 20 minutes with the cobots. The improved productivity, minimum maintenance, and simple integration are what attracted the automotive manufacturer to cobots.
5. Segmentation of Global Market by Application
5.1 Market Overview by Application
Use cases for cobots are being discovered in a wide range of industries. In some, they replace traditional industrial robots used for packaging, assembly, inspecting and dispensing materials, in other industries they are the first ‘robot-entrant’.
5.2 Material Handling
Cobots are playing a growing role in material handling. Just as cobots are beginning to offer more flexibility than their stationary counterparts in manufacturing, so too are autonomous mobile robots (AMRs) providing more flexibility than more traditional AGVs. Material handling/warehousing/logistics is an interesting growth segment, because as mobile cobots continue to mature and grow they will become more and more intelligent and will become more effective in these mobile applications. Many of the advances in cobots are focused on the needs of consumer goods manufacturers, warehouses and distribution centers. Broad segments such as manufacturing, healthcare and hospitality all face challenges in moving materials through their facilities and many manufacturers who need to move medium to smaller loads also want to automate their material handling.
Fastbrick Robotics has developed the Hadrian X, a cobot capable of laying 1,000 bricks in one hour. It would take two human bricklayers a day to match that work rate. Hadrian X is a truck-mounted cobot with a 98-foot retractable arm that can do everything human brick-layers can do, but faster and for much longer periods of time. The machine is large, but gains easy access to any construction site since it can simply be driven up and parked where it is needed. The cobot can cut, grind, mill, and route bricks prior to laying, and the base of the cobot remains stationary while its arm works to stack the bricks into place.
Atria Scandinavia is one of Northern Europe’s leading manufacturers of vegetarian and gourmet products for convenience markets and retail chains in need of round-the-clock service. At one of Atria’s plants, in Sweden, it implemented cobots to increase production efficiency while keeping staffing costs down. Atria plans to scrap a traditional, shielded industrial robot and a bulky packaging machine and automate all of its packaging lines with cobots. Line changeover downtime was cut from six hours to just 20 minutes and carton waste was reduced by 25 percent. Another advantage is the ability the cobots give Atria to develop new applications.
The adoption of cobots having above 10 kg payload capacities contributes to the increased use of cobots in assembly, especially in the automotive sector, where handling and assembling heavy parts are commonplace. The increased capacity enhances the number of tasks that they can perform, especially in the final assembly of cars. For example, workers use cobots to help fit shock absorbers to Fiesta cars in Germany. It ensures a perfect fit, avoids workers having to access hard‐to‐reach places without having to manipulate a heavy shock absorber and installation tool.
A Rethink Robotics’ Baxter cobot works at custom molding company, the Rudon Group. It does the noisy and boring task of feeding scrap into recycling machines. The company has been able to improve productivity with these systems.
At AMA Plastics, five cobots have largely replaced human assembly workers, pushing experienced human workers into more demanding roles.
Yooshus offer an example of mass customization in the production of footwear. They are the first flip-flops that are custom-made for each foot, and a cobot makes them happen. Customers at a Yooshu kiosk pick their material color, strap style, artwork or text for the sole, and then step up to have their feet laser-scanned in three dimensions. the data points are communicated to a cobot, which cuts out the customized flip-flops right in front of the customer, for an exact fit.
GE Lightning uses a cobot in the production of LED street light fixtures. The cobot functions as a tool for the workers in the factory. It fetches supplies or tools for workers, places the pieces of a light fixture together for the worker to perform final assembly, or does machine tending.
Franke, a Swiss kitchen manufacturer, succeeded in increasing productivity with the help of cobots. The company produces more than 10,000 kitchen rinses per year and was exposed to immense cost pressures in production due to the high competitive density in the market. Management was looking for a solution in which a cobot participated in a production process together with an employee. The cobot glues mounting blocks to the sides of kitchen sinks, using only the required amount of glue for each join. The maneuverability of the cobot - all six axes can be rotated 360 degrees by a radius of 85 centimeters - is a great advantage.
UK-based Moley Robotics created an autonomous kitchen machine that uses two cobot arms with robot hands to reproduce the movements of a human chef. A 3D-recording of the cooking process maps every individual motion, allowing the cobot gourmet to prepare any meal that was recorded.
Mofongo’s Distillery and restaurant in the Netherlands has a cobot mounted on a seven-meter tall Festo linear actuator behind the bar. A human bartender places three shot glasses in the cobot’s gripper and enters which liquors to be dispensed through the cobot’s touch screen. Then the cobot swoops straight up to fulfil its mission, quickly identifying the chosen three bottles from 56 different options displayed on the wall. Once each shot glass has been filled, the cobot slides back down to deliver the distilled goods.
Creating Revolutions makes a customer service paging system for the hospitality industry. The hockey puck sized Communication Disc connects guests with their waiter through their smart phone. Assembling the disc is a complex task requiring great accuracy and repeatability. The addition of the cobot led to a project reject rate that has gone from double digits to below one percent, significantly reduced overhead and an increase in production.
5.6 Other Applications
Cobots are not limited to the factory floor. They are already being used to milk Swedish cows, to keep supermarket shelves stocked, and they are used in critical life or death situations. The KUKA LBR Med operating theatre cobot helps surgeons, sawing bones, performing endoscopies, and more.
Cobots are also entering daily life. There is a growing body of research exploring how cobots may help elderly people live more independently. This may become necessary as population demographics change. Healthcare service cobots offer much-needed support for physicians, nurses, and other caregivers in healthcare systems. Cobots are assisting in laparoscopic surgery in Spain, providing rehabilitation support and helping lift bed-ridden patients in Denmark, and even delivering sports massages in Singapore.
At the Rio Olympics, a camera-wielding cobot, filmed swimming and athletic competitions for French television company, FTV. The camera mounted on the cobot caught all the action, even in spaces that were too tight for a traditional crane. In a more refined camera application, cobots equipped with light projectors and video cameras guided visitors at the Metropolitan Museum of Art in New York City.
GNE Farm Equipment is using cobots to reduce the costs of milking cows, which is helping the company address a decade-long shortage of qualified milkers. The cobot automates the labor-intensive process of manually disinfecting cows’ udders before and after being milked.
In a DARPA demonstration, a small cobot shared the cockpit of turboprop plane with a human pilot. The cobot arm is part of the Aircrew Labor In-Cockpit Automation System (ALIAS), which also includes a tablet-based user interface with speech recognition and other components such as cameras. When installed on a plane, the cobot acts as the co-pilot in charge of flying the aircraft. It is part of a government-industry collaboration to help address the shortage of second human pilots.
6. Segmentation of Global Market by Region
6.1 Geographic Market Overview by Region 2017-2022
North America, Europe and Asia-Pacific (APAC) region are the most important markets for cobots. Important national markets are the US, China, Japan, Germany, South Korea, and Mexico.
The European cobot market is the largest, followed by the North-American and APAC markets. The APAC region leads the global industrial cobot market in the automotive industry in terms of sales volume as well as annual revenue, followed by Europe and North America, and has the strongest growth of the three regions. The North America region is expected to see strong continued cobot growth, and Europe can also expect rapid further growth, according to the IFR. Strongest growth potential however, exists in the APAC market, with China and the Southeast Asian countries expected to be the main driving engines for growth. The APAC market is expected to significantly expand over the estimated period because of the increasing variety of manufacturing practices carried out across the continent. China should remain the main driver of cobot growth, expanding its dominance with almost 40 percent of the global cobot supply being installed there by 2019. The other regions (Africa, South America) will increasingly fall behind.
6.2 North American Market 2017-2022
In 2016, the North American robot market broke records for orders and shipments, according to the Robotic Industries Association (RIA). A little more than 34,600 robots valued at approximately USD1.9bn were ordered in North America, representing growth of 10 percent in units over 2015, according to the RIA. Many of those robots were recruited by automotive OEMs, with shipments into the automotive market growing 25 percent relative to 2015. In the food and consumer goods industries, orders increased by 32 percent last year, adds the RIA. Cobots probably did not account for a large piece of that pie, but their market share will soar in the coming years.
6.3 European Market 2017-2022
Europe is a region with high cobot density, especially in Germany and the Nordic countries. Europe dominated the global cobot market and it captured the largest market share in 2016. The European cobot market is primarily driven by proactive government support such as the Industrial Revolution 4.0, which promoted factory automation solutions throughout Europe. Also, high investment for cobot R&D is also propelling the market growth.
The adoption of cobots in healthcare expected in the medium- to long-term, with demographic pressure providing some extra urgency. In the short term, and specifically looking at the industrial market, key industry trends include the growth in the adoption of cobots that have above 10 kg payload capability. This is important for the automotive sector, where a lot of heavy handling, pick and drop, and assembling tasks involving heavy parts are being carried out. Because Europe is an important industrial hub, particularly in the automobile sector, it will be an important market for these ‘heavy lifting’ cobots.
6.4 Asia-Pacific Market 2017-2022
The APAC market is now growing faster than both the European and the North American market. Cobots in the APAC region are expected to surpass that of Europe by 2018, holding a large market share through at least 2022. This is not only caused by China, but also by countries that already have a high number of industrial robots in use, such as South Korea, Singapore, and Japan. India is also a rapidly developing market. In the 2017-2022 timeframe, the APAC market should continue to grow rapidly, due to the increasing number of uses for cobots in rapidly diversifying manufacturing industries across the region.
Japan is a frontrunner when it comes to use of cobots. Demographic pressures add an extra sense of urgency. Cobots will do specially well in the healthcare and consumer-markets. The number of industrial robots in Japan is high, and the quick growth of both that sector, and that of industrial cobots, should continue in the next years.
China is embracing robots with full intensity. The Chinese robot market is growing three times faster than that of the rest of the world and growing at a CAGR of more than 50 percent. It is home to the world’s fastest-growing cobot market and a vast manufacturing sector where companies are under pressure to automate, partly due to rising wages in the country. In 2016, China installed 90,000 new robots. That is one-third of the world total and 30 percent more than the year before. An increasing number of them are cobots. China overtook Japan in 2013 in unit sales domestically. Still, cobot density in China is low when compared with countries like South Korea, Japan, or Germany.
Beijing plans to focus on automating key sectors of the economy including car manufacturing, electronics, home appliances, logistics, and food production. At the same time, the government wants to increase the share of indigenous-branded cobots in China to more than 50 percent of total sales volume by 2020 from 31 percent last year.
Demand for cobots in China is clear enough. Less certain is whether Chinese cobot companies have the tech savvy to compete globally. Lured by tax breaks and cheap land, some 800 Chinese robot companies have set up shop, some of them also offering cobots. Trouble is, some startups buy key components from Siemens or Fanuc, put them in a robot shell with an arm, and then slap on a Chinese brand name. Because of this, half of China’s robot makers will likely shut their operations in the next couple of years.
However, with China’s huge demand, its financial heft, and Beijing’s desire to develop, a handful of globally competitive Chinese cobot makers are likely to emerge. One of the most promising is Midea, which acquired German cobot-manufacturer KUKA in 2017.
The biggest cobot market in China may be logistics. While Amazon took the lead with its purchase of cobot maker Kiva in 2012, JD.com and Alibaba are rushing to automate their businesses, which are still reliant on tens of thousands human workers. Both are experimenting with delivery cobots and automating their warehouses. The goal is near humanless warehouses and package-delivery by drones or driverless vehicles.
6.4.4 South Korea
South Korea is one of the leading adopters of robots. In 2017, South Korea claimed the highest robot concentration globally with 531 multipurpose industrial robots per 10,000 employees in the manufacturing industry. A few years ago, South Korea saw an opportunity to become the leader in the new emerging cobot market. Things have moved forward since then, and the latest industry expo, RobotWorld 2017, showcased a great number of outstanding industrial cobots.
With new developments and market entries, the competition among companies producing cobots in South Korea is growing. RobotWorld clearly demonstrated South Korea’s drive to become a world leader in the field of next- generation, lightweight, industrial cobots. The country aims to take this sector by storm with a number of innovative solutions that will likely shake up the market. The implementation of industrial robots in general, and cobots in particular, is expected to continue to grow in South Korea in the next five years.
6.5 Latin American Market 2017-2022
With the exception of Brazil, Mexico and Chile, countries in Central and South America have not invested much in the digital infrastructure and education necessary to benefit from the growth of the robot and cobot industry. As cobots in highly developed nations become cheaper than human laborers in poorer, less-developed nations, these countries, that formerly attracted “runaway factories” from developed countries, may witness relocation of production facilities back to their ‘own’ countries, having a negative impact on labor markets. Although growth in the use of cobots is forecasted, expectations are that the growth will be lower than in advanced countries, widening the gap over the next ten years.
6.6 Rest of World Market 2017-2022
The cobot market for the rest of the world is expected to follow the leading nations at an increasing distance.
7. Manufacturing Landscape
In service robots alone, there are more than 600 companies worldwide that are developing products and solutions for a vast variety of commercial or private applications. An estimated 200 or more of those companies are considered startups, meaning they are no more than five years old. These companies are heavily driven by technology and are conquering new markets such as in the healthcare industry or agriculture, and many of them offer cobots. The advance of cobots has partially erased the boundary between service robots and industrial robots.
7.1 Overview of Global Manufacturers
The cobot market is currently led by KUKA, Universal Robots, Rethink Robotics, and Fanuc, but they are under increasing pressure from both their main competitors, which are based in Japan, South Korea, and China, as well as from new entrants in the market. A number of traditional industrial robot companies, as well as some non-robot companies, have introduced their own in-house developed line of cobots in 2017, or acquired one of the leading cobot manufacturers, as Midea did with KUKA and Omron with Adept Technology.
FANUC, from Japan, is a group of companies that provide automation products and services such as robots and computer numerical control systems. FANUC is one of the largest makers of industrial robots in the world. It had its beginnings as part of Fujitsu developing early numerical control (NC) and servo systems.
FANUC makes CNCs, servo motors, lasers, and a full line of industrial robots. The company is the biggest of the Big Four robot providers. In the first six months of 2017, the robot division reported that sales in the Americas and Europe and sales to the general industries in China continued to remain favorable. Particularly, demand in China was very robust. Orders also increased in Japan. As a result, net sales in the robot division increased sharply YoY, from JPY46.1bn in the second quarter of 2016, to JPY55.1bn in the same quarter in 2017.
The company entered the cobot market in 2015 when it released the CR-35iA, a 6-axis cobot that looks to be targeted at the same market and applications as Rethink's Baxter. FANUC’s CR-35iA is their first cobot and it can carry the heaviest load of all the cobots so far announced: 35 kg, and has full safety compliance using soft rubber skin and multiple sensors including either a vision sensor or a 3D area sensor.
The CR-35iA is too big for work in a narrow space such as on an electronics assembly line but it’s ability to carry heavy loads opens it up to other tasks better suited for a cobot than a human such as inserting a spare tire into a new car’s compartment. FANUC later introduced two smaller cobots, the CR-4iA and the CR-7iA, smaller cobots designed to work with smaller workloads.
Switzerland-based ABB, one of the Big Four global industrial robot manufacturers, operates in more than 100 countries with about 132,000 employees, and has made steady progress in transforming into a leaner, more customer-focused, digital technology leader. ABB started moving its business focus from selling pure hardware to providing digital services and software a number of years ago. In the past, ABB sold individual robots, today its robots can be networked, and send data to a central monitoring system, making it possible to share the learning with all connected robots through networked software. The newly shaped Robotics and Motion division, based on ABB’s Discrete Automation and Motion portfolio, is focused on the fast-growing robot segment, and on industrial motors and drives where ABB is #1 globally.
ABB’s robot business, currently #2, has the aim of becoming the market leader.
In 2016, ABB launched its smart sensor, which can be attached to the hundreds of millions of electric motors now in use globally. The company's YuMi cobot is targeted primarily at automating tasks within the consumer electronics industry. The company recently announced a collaboration with IBM (IBM) to leverage IBM's Watson IoT computing capabilities, specifically its Cognitive Visual Inspection tools to ABB's products. By using Watson's image recognition capabilities companies will be able to use ABB cobots for product inspection tasks, detecting flaws and defects that a human eye would miss or be unable to see. Computer vision can also enable YuMi to gather visual data to better understand tasks and take action to reduce inefficiencies and redundancies. ABB’s YuMi won the Invention and Entrepreneurship in Robotics and Automation Award at Automatica, the leading tradeshow for robots and automation.
Early in 2015 ABB acquired Germany’s Gomtec, a start-up producing a one-armed cobot named Roberta. Gomtec was headed by Bernd Gombert, a mechatronics engineer with 100+ patents and who was the head of a DLR project that became KUKA’s LBR iiwa cobot (see below).
Because ABB has an extensive sales-, distributor-, and integrator-network in place, as well as a large marketing force, they are expected to quickly penetrate the small parts assembly market with their lineup of plug and play one- and two-armed low-cost cobots.
Korean cobots assemble!
Doosan enters cobotics business via subsidiary Doosan Robotics
Doosan Corporation’s Doosan Robotics built a cobot factory in Suwon and has begun mass production of a line of cobots which it unveiled at Robotworld in September 2017.
Cobotics is one of the fastest-growing robotics segments
Most robots are currently shipped to factories, where they are used to make other machines, like automobiles, computers and appliances. As consumers continue to buy more gadgets, the industrial robot market continues to grow and will approach 200 percent within a decade. The driver of the bulk of that growth will come from a new generation of manufacturing robots that is more collaborative, smaller, and more perceptive than traditional industrial robots. Cobots will account for almost 40 percent of all industrial robots sold by 2025.
Doosan to benefit from sales of and synergies with Doosan Robotics
We view Doosan Corporation’s foray into the cobot business as an opportunity for the company to capture a significant part of this growing business. The line of cobots unveiled are equipped with technologies such as pressure sensors that put them on par with cobots that are nearly double the price from market leading companies like Kuka. Solid technology coupled with a wide distribution network thorough related companies give the company a competitive edge over the myriad cobot players now entering the fray. Because of the aforementioned reasons, we believe Doosan is Korea’s cobotics leader and expect the company to see significant growth going forward.
2017 marked the start of several Korean companies entering the cobotics business. Hanwha Techwin and Doosan Robotics have also entered the cobot arena, which is currently dominated by a handful of foreign players.
The aggressive launchings of domestic cobots by several Korean players is a clear indicator of the tremendous potential that the cobotics business presents. Hanwha Techwin unveiled its first cobot, the HCR-5 in March 2017. Doosan Corporation Doosan Robotics built cobot factory in Suwon and has begun mass production of a line of cobots which it unveiled at Robotworld in September 2017.
The massive market for cobots has drawn many other Korean robotics companies into the fray, including SBB Tech, a robot component company, builds cobots are based on the company’s modular robot actuator. Another newcomer in the space is Neuromeka, which has also a cobot called Indy, based on a smart connected robot.
We believe Doosan’s fast follower strategy for its cobot business is sound. The company’s current cobot product line is well-positioned in terms of technology and pricing and thus capable of posing a serious challenge to the existing order in the global cobotics market. Currently, the leader in terms of market share is Denmark-based Universal Robotics, which was acquired by Teradyne in 2016. Trailing Universal is Kuka, which was acquired by China’s Midea, is a traditional robotics manufacturer who is now aggressively pushing into the cobotics market. Doosan’s line offers comparable performance and technologies to the Kuka line, which includes pressure sensitivity, but at about half the price, according to sources at the company.
The aggressive pricing coupled with the cobots’ impressive technical capabilities should enable the company to capitalize on the rapidly growing robotization trend taking place at not only major companies, but SMEs as well. We are closely monitoring developments at the company and overall cobotics market but at present we believe Doosan is well- positioned to become a global cobotics leader.
Cobots extend the reach of Techwin’s robot portfolio
Hanwha Techwin enters the collaborative robotics market
Hanwha Techwin’s line of collaborative robots are designed to be backward compatible with Teradyne’s Universal Robots’ UR series. The company appears to be focusing on being the cobotics leader in the Asian market with an eye on entering Europe and then other areas.
Building on existing robotics expertise
Techwin is already a contender in many other areas of robotics, which includes unmanned surveillance robots and autonomous vehicles.
Timely entry into the collaborative robotics market
Techwin’s focus with the HCR-5 cobot appears to be on the domestic market for now. We believe this is because the company desires to better able to refine its technology and business before it expands to other markets outside of Korea. The HCR-5 only requires one control box and one teach pendant to control two robots. This reduces the operating cost to about 30 percent less than with traditional industrial robots.
Techwin’s HCR-5 cobot, which it unveiled in 2017 has a lightweight structure and a greater reach, it seems like the HCR-5 will be able to compete the UR5 from Teradyne’s Universal Robots. As both the HCR-5 and UR5 share identical tool plate, it appears like all the tooling that can be used on a UR5 can also be used by the HCR-5. We see this as a good decision by Techwin as it enables the HCR-5 to immediately capitalize on the world’s largest cobot tool plate base. This will enable Techwin to not only sell at competitive prices to new customers but positions the HCR-5 as a viable replacement and line expansion cobot as well.
Techwin has already secured a contract to provide a logistics automation facility for Nexen Tire company’s planned factory in the Czech Republic. According to Techwin, the HCR-5 represents the first step in the company’s “full- fledged operation in robotics”. The HCR-5 weighs 20kg, so it can be easily moved without a forklift or any other special transporting equipment. In addition, the HCR-5 is has an operator-friendly interface, according to the company. A touchscreen teach console and a direct teaching function allow operators to teach the robot tasks by moving the robot body with their hands. The HCR-5 also has a collision detection function that protects the operator by automatically stopping when an imminent impact is detected.
The company is preparing itself to capture a portion of the global cobot market which is currently valued at USD300mn million, as of 2018, but it is expected to grow to USD30bn by 2022.
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