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Golden Era to Come
China's robot industry leader anticipates flourishing next five years
By Wang Jun | NO. 45 NOVEMBER 9, 2017

Journalists look at the industrial robots during a visit to the Xianghe industrial park in Langfang, north China's Hebei Province on October 22 (XINHUA)

China now has become the world's largest application market of industrial robots, accounting for one third of global market share, according to a report on China's robot industry released by the Chinese Institute of Electronics earlier this year. While foreign robot makers speed up the pace in grabbing a slice of the fast-growing Chinese market, leading Chinese robot manufacturers also seek overseas expansion.

Xu Fang, technology director of Shenyang-based Siasun Robot and Automation Co. Ltd. and also an expert advisor of the report, told China Securities Journal that China's robot industry may face golden development opportunities in the next five years, and the company will further strengthen independent research and development (R&D), produce more intelligent products and expand global industrial chains to prepare for future progress.

Complete product line

A leader in China's robot industry, Siasun, established in April 2000, has a complete product line that includes industrial robots and service robots as well as system integration products and solutions. The company has formed an industrial chain incorporating exclusive technologies, core parts and components, leading products and industrial system solutions, according to Zhao Liguo, board secretary of Siasun.

In Xu's opinion, the complete product line was built by overcoming numerous technical difficulties and demonstrates domestic robot makers' capabilities in independent R&D. Through overcoming these difficulties, the company has continuously diversified its product line, and its industrial chain has become increasingly complete, he said.

Siasun is now the only maker of clean vacuum robots in the Chinese market, said Du Zhenjun, head of the company's department of innovation and key projects.

According to Xu, Chinese semiconductor makers had faced bottlenecks to produce their own chips for vacuum robots. Manufacturers in developed countries only sold complete set of equipment, perhaps costing $900,000, instead of single robots to China, costing maybe $150,000. Besides, it took at least nine months to import such equipment from the United States because of the strict customs examination procedures. With years of hard work, Siasun has developed clean robots with independent intellectual property rights, hence making the market prices of such robots more reasonable.

R&D is the key to gain market dominance. In the first half of this year, Siasun spent 74.24 million yuan ($11.18 million) on R&D, a year-on-year increase of 260.34 percent. Zhao said Siasun is among the few manufacturers in China that can compete with foreign companies in the high-end robot market.

"Half of our clients are long-term ones, and with our newly developed products, we can attract 50 percent more new clients every year," said Xu.

According to its semiannual report, in the first half of 2017, the company realized 1 billion yuan ($150.6 million) of revenue and 180 million yuan ($27.11 million) of net profit, growing by 15.47 percent and 6.67 percent, respectively, year on year. Less than 10 years after its initial public offering, Siasun has seen its revenue and net profit grow five-fold.

Intelligent manufacturing

Manufacturing, especially high-end manufacturing, represents the core competitiveness of a country or region. Intelligent workshops, which integrate robots, the Internet, information technology and intelligent equipment, represent the direction of the manufacturing of robots.

Siasun's factory is itself an intelligent facility, with all production procedures completed by robots, a setup that may be described as "robots producing robots."

Xu said such intelligent workshops, are one of the platforms Siasun produce for intelligent manufacturing. With its self-building intelligent workshop Siasun can produce 5,000 robots every year, and the full capacity stands at 10,000 robots annually.

Siasun also tailor-makes intelligent workshops for other companies to enable their industrial upgrading and transformation. Users of intelligent workshops produced by Siasun include China National Nuclear Corp. and ZTE Corp., according to the China Securities Journal report.

Xu said intelligent equipment platforms, especially intelligent industrial robots, are another product line of Siasun. Different from traditional industrial robots, intelligent industrial robots are equipped with various sensors and have judgment, memory, reasoning and decision-making abilities, hence they are better able to adapt to external changes and perform more complicated operations.

Competition is now fierce in China's industrial robot market. Besides foreign companies, powerful domestic companies downstream in the robot industry chain are trying to capture a share of the market. For example, home appliances maker Midea Group took a controlling stake in German robot maker Kuka in May 2016 and Tunghsu Azure Renewable Energy Co. Ltd. acquired Shanghai ANX Automation Technology Co. Ltd. in June.

Therefore, supplying high-end intelligent products and developing the market in manufacturing has become a target for Siasun. According to Xu, through R&D of new-type intelligent industrial robots, the company has diversified its product lines.

Greater market share

Siasun products have been sold in more than 20 countries and regions in Europe, the Americas and Asia, and the company is planning to set up R&D centers or marketing networks in Singapore, Japan, Europe and North America to enhance the market reach of its products.

Xu said the overseas expansion is a new attempt by Siasun to actively participate in international competition. To gain new clients in foreign markets, a company must have its own advantages. For example, Siasun has been exporting mobile robots for 10 years. "After visits to North America, we found that our intelligent logistics equipment is competitive in the local market, and in the sector of intelligent logistics, all the most advanced technologies are in China," said Xu. Siasun has cooperated with Michelin to jointly develop intelligent logistics system for the tire industry.

In 2016, Siasun exported products worth 150 million yuan ($22.59 million), soaring by 346.76 percent year on year and accounting for 7.37 percent of the company's total revenue. To improve its competitiveness in international markets, Siasun now plans to acquire high quality companies overseas, said Zhao.

Copyedited by Chris Surtees

Comment to wangjun@bjreview.com

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