The lack of efficient workforce and high labor costs have led to the adoption of industrial robotics in most of the sectors. Use of robotics in any company accelerates productivity and, hence, the profitability of that company. Every company now expects robots as its helping hand.
With industrialization pacing in such a speed, the demand for robotics has gone sky high. The extraordinary surge in the robotics market is, therefore, quite understandable.
According to Allied Market Research, the market for industrial robots, which was valued at USD 31.78 billion in 2018, is now expected to attain a compound annual growth rate (CAGR) of 25% during 2019–2024. According to the World Robotics Report by the International Federation of Robotics (IFR), 381,000 industrial robots were shipped globally in 2017; this number is expected to increase to 630,000 units by 2021. By 2019, more than 1.4 million new industrial robots are forecasted to be installed in factories around the world.
The increase in demand for industrial robots can be linked to the ongoing trend toward automation, surge in labor cost worldwide and innovative technical improvements in industrial robots. New and improved robots can offer easy, cost-effective and error-free solutions to serious technical issues in several industries. Moreover, with the decline in sensor prices and the emergence of new technologies, now customers can expect their return of investment (ROI) in a month. Hence, even small- and medium-sized industries are now implementing automation for enhanced productivity. This increasing demand for industrial robotics systems is the driving factor for the market for industrial robots.
Various industries such as automotive, electronics, chemical, rubber, plastics, machinery, metals, food and beverages, precision and optics and others have implemented industrial robots. Although the automotive industry is the largest user of industrial robots, growth in this segment is expected to fall, due to a projected slowdown in the automotive industry during the forecast period. The spiraling food and beverage industry is expected to take its place in the near future.
The major markets for industrial robotics that hold significant potential for future ventures have been discussed below.
With the strongest demand for its innovative robotics designs and a market share of 36% of the total supply, China is leading the robotics market. According to IFR, China sold an approximate of 138,000 industrial robots (59% of the total) in 2016–2017—a sales volume higher than the total sales volume of Europe and the Americas combined (112,400 units). The total sale is projected to increase by 20% on average (400,000 units) between 2016 and 2019. Establishment of 800 robotics companies was reported in China at the beginning of 2017; toward the end of 2017, however, this number had increased to 6,500. Two of the major Chinese robotics players are SIASUN and DJI Innovations.
However, due to the intervening growth of foreign robot suppliers in China, the market share of the Chinese robot suppliers has decreased from 31% in 2016 to 25% in 2017. Also, the robot density in China is only 68 robots per 10,000 employees. To counter these issues, Government initiatives like ‘Made In China 2025’ and ‘Robotics Industry Development Plan (2016–2020)’ have prioritized the robotics industry and aimed for high-end development in this field.
Japan’s robot production capacity has reached 153,000 units in 2016. This has made Japan world’s number one industrial robot manufacturer. Today, Japan encompasses 52% of the global robotics supply, exporting robots and their parts to important destinations like North America, China, the Republic of Korea and Europe. The years 2016–2017 saw a 45% increase in Japan’s export rate. It is now the second biggest market for robotics. On the other hand, Japan imports very minimal number of robots—only about 1% of the global installations—hence encouraging its home production.
Driven by major sectors like the electrical/electronics industry, Korea ranks as the third largest market for industrial robotics. It is also, by far, the highest robot density country in the world; it has about 630 robots per 10,000 employees, which is more than 8 times the global average amount. About 41,400 robots were sold in 2016—a rise of 8% compared to 2015. However, 2017 saw a fall in the export of robots by 4% due to 18% reduction in robot installations in the electronics industry.
The USA has been witnessing an exponential growth in robotics installation for 7 years in a row now, the new peak being 33,192 installations in 2017. With 189 robots per 10,000 employees, the USA ranks as the 7th robot density country in the world. The robotics market is projected to grow by at least 15% by 2020; the sale of robots in this country is thus showing no sign of slowing down.
Germany—the fifth largest robotics market in the world and the first in Europe—exported 60% of its robotics equipment in 2017. With a record sale of 21,404 robots in 2017, the sale increased to 7% of the previous year’s sale (20,074 units). According to the German Mechanical Engineer Association, VDMA, the expected market potential would reach $18.5 billion in 2018.
These top countries predominating the robotics market are at fierce competition with each other. Here is a graphical overview depicting the geographical distribution of the robotics market in the global front.
While Asian nations like Japan, Korea and China have already established their firm hold in the robotics market, India has quite a long way to go. Although India is still a low robot density country, rapid economic developments and technological advancement paint a greener picture for the growing robotics market in India. India has witnessed considerable growth both in terms of producing robots and adopting robotics. So the race is still on.
The industrial robotics market ecosystem is ruled by the following robot manufacturers: Mitsubishi Electric Corporation (Japan), FANUC Corporation (Japan), Kawasaki Heavy Industries Ltd. (Japan), Yaskawa Electric Corporation (Japan), Seiko Epson Corporation (Japan), Nachi-Fujikoshi Corporation (Japan), Denso Corporation (Japan), Daihen Corporation (Japan), ABB Ltd. (Switzerland), KUKA AG (Germany), Stäubli International AG (Switzerland), Comau SpA (Italy), Omron Adept Technologies, Inc. (US), Universal Robots A/S (Denmark), CMA Robotics SPA (Italy) and so on. This proves that Japan is indeed the predominant manufacturer of robots in the world, with its 52% contribution to the global supply.
Industrial robots have been on the rise, and so is their market. The cut-throat competition among the leading robotics manufacturers is definitely going to increase the market potential of the industry to manifold. According to a recent survey, the market potential for Industrial Robotics may worth an approximate of USD 79.58 billion by 2022, growing at a CAGR of 11.92%—which is not shocking at all.