Thursday, November 17, 2011

Huge employer in China makes big step toward robots

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The New Economy, November 17, 2011

Foxconn, a big contractor for Apple and others, breaks ground for robot facilities. It plans to replace 500,000 workers with 1 million robots.

Workers are seen inside a Foxconn factory in the township of Longhua in China's southern Guangdong Province in this 2010 photo. After a spate of employee deaths and complaints about working conditions, electronics manufacturer Foxconn has broken ground on new robot facilities. Within five years, it says it plans to replace 500,000 workers with 1 million robots. Photo: (Bobby Yip/Reuters/File) 
By Frank Tobe, contributor

When the world’s largest maker and assembler of electronic components and products announced plans in August to replace Chinese workers with robots, some robot executives called it a ploy to keep their workers in line. The company didn’t want to build robots, they said, it wanted to control its workers, who had complained of tough working conditions and had a spate of suicides.

But earlier this month, officials from Hon Hai Precision Industry and its subsidiary, Foxconn, took the next step, signaling a potential sea change in the electronics industry. They broke ground for new robotics R&D and manufacturing facilities in a new industrial park in Taichung, central Taiwan. Foxconn, which made its name by using cheap mainland Chinese labor to supply the likes of Apple, HP, Sony, Dell and Nokia, says it will replace 500,000 workers with robots in the next three to five years.

The plan is so sweeping that its implementation would have huge implications for China and the robotics industry worldwide. It signals that Chinese labor may no longer have the low-cost advantage it once enjoyed and that the robotics industry is ripe for change.

Start with China. Most of Foxconn’s 1.2 million employees work there. So an automation plan that would replace nearly half the company’s workforce suggests that the cost of those workers is rising. In a press release, the company said mass producing assembly-line type robots was part of its plan to cope with labor shortages and rising wages.

Foxconn has special reasons for speeding up factory automation. During the past 15 months, at least 14 Foxconn workers have died in apparent suicides, most of them in the Chinese city of Shenzhen, where harsh working conditions were said to exist. The company received so much negative publicity and scrutiny from labor groups and clients, Apple in particular, that it began a two-pronged effort to reduce labor costs.

Foxconn has been relocating factories closer to its source of employees, inland China and central Brazil, and is moving ahead with its robot development. The company expects its new robot R&D and manufacturing facilities to create 2,000 jobs in Taiwan. The new robots which will be deployed in China, will allow Foxconn to move displaced workers up the skill ladder to better paying and more interesting jobs. How many workers are kept on is anybody's guess. But with sufficient growth, Foxconn has an incentive to redeploy most of them, which would avoid having to hire, train, and house additional workers as production needs increase.

Foxconn’s move also represents a wakeup call to ABB, KUKA, and Fanuc – the world’s largest robot manufacturers currently. Its plan to develop robots on its own implies that the current lines of industrial robots are not flexible and easily trainable enough for the likes of Foxconn.

Foxconn’s move into the robotics business reflects how things are changing in the industry. The days when industrial robots had a small library of moves but precisely and reliably repeated those moves 24/7 are no longer. New tech is more personalized and manufacturing is following with small quantities of thousands of variants of base products. Robots have to keep up with those changes. At present they have not.

Foxconn’s plans are hugely ambitious, nevertheless. According to the latest statistics from the International Federation of Robotics (IFR), there were 52,290 industrial robots in China of which approximately 10,000 were in Foxconn factories. Thus, the company is aiming to go from 10,000 to 1 million robots in three to five years.

That would nearly equal the number of industrial robots currently deployed worldwide –1,035,016, according to the IFR.

Some analysts remain skeptical that Foxconn really intends to build robots. It will concentrate on automation machinery instead, they say. But two sources – both claiming not to be able to provide details because of nondisclosure agreements – say the opposite: Foxconn is planning on entering the robot manufacturing business with a variety of flexible, easily trainable, and low-cost assembly-line robots.

China is the fastest-growing market for the use of industrial robotics, IFR says. It forecasts that industrial robotics applications in China will increase by 64 percent next year.

Swedish power and automation technology company ABB Group recently built a robot manufacturing facility in China, supplementing numerous sales and integration offices.

The stock of Foxconn’s parent company, Hon Hai, has fallen about 22 percent so far this year, but margins are improving as plant relocations are completed. One Barclay’s financial analyst says the next 12 months look much better. Factory relocation costs have still taken a toll on Hon Hai's bottom line profitability, though analysts say the expansion could pay off in the long-run, thanks to the lower wages that Hon Hai will be able to pay in these less affluent regions.

– Frank Tobe is editor and publisher of The Robot Report, a website that tracks the global business of robotics, and the Everything-Robotic blog

Friday, November 11, 2011

Lots of robots coming onboard in 2013, 2014 and 2015


Pure science is an integral part of robotics and often leads to solutions for strategic needs for an audience of willing buyers. Here are a few examples of that process from companies with products scheduled to hit the marketplace in the next four years.

Harvest Automation
  • Servicing ornamental horticulture market ($35 billion industry)
  • Focused on nurseries and greenhouses and their continual need to move potted plants
  • Each robot to produce 10,000 hours of production and do the work of one laborer
  • Will be in field beta testing in 2012; full rollout of commercial product in 2013
  • This year's field testing quite successful
  • More than 10 prospective nursery clients signed on to be test sites and contributed to the development process
  • Fully venture funded until 2015 projected profitability
Foxconn - throwing all the other numbers out of whack
  • Building $223 million R & D and manufacturing facility to produce assembly-line robots
  • Plans to go from 10M present number of robots to 300M by end of 2013 to 1MM by end of 2015
  • Mammoth rollout in Western terms; but not for Asian factories
  • Hiring 2,000 Taiwanese engineers and scientists to make it happen
  • Foxconn has had problems managing all their employees (1.2 MM)
  • Replacing 1 million dull, dirty and dangerous tasks in their own factories with robots will eliminate 500M positions; Foxconn says they are planning to move up those 500M rather than lay them off; also saves necessity to hire 500M more workers
  • Robots will likely be low-level polishers, painters, welders and transporters with intricate assemblies still done by human hands
Sea Robotics
  • Office of Naval Research sponsored research to develop robotic underwater device to clean ship hulls
  • Science is to mimic the behavior of sea creatures
  • $1 billion in excess fuel and cleaning attributable to biofouling - barnacles and biofilm adhering to ships hulls
  • Hull Bug, Sea Robotics new robot, is a fully autonomous submersible that figures out how to efficiently traverse a complicated three dimensional environment consisting of the contours of a ship
  • Sensors determine clean or not clean thus robot can determine the surfaces it has yet to sweep
  • Other sensors inspect for barnacles and they are removed differently
  • Cool and descriptive video and an in-depth report on the details of the project
  • Currently being tested with deployment in 2015 across the US Navy's fleet
These three examples are just the tip of an iceberg of near-term robot deployments. Other announcements include hoped-for companies like Heartland Robotics and the commercialization of DARPA science projects such as the ARM Project which is slated to complete in 2014, to niche robot markets like the one to maintain and inspect high voltage transmission lines from the Electric Power Research Institute due to be deployed in 2014.

Heartland Robotics' project is a big hope for American-based robotics businesses if and when it produces a factory assistant robot - a co-robot - for small and medium-sized enterprises.  Similar to Harvest Automation - Heartland has enlisted manufacturer partners to help them help each other. No field trials yet nor planned dates given.

DARPA's ARM Project is developing software and hardware that enables a robot to autonomously manipulate, grasp, and perform complicated tasks, with humans providing only high-level supervision. The ARM robot will be able to adapt to unstructured, dynamic environments. Imagine a two-armed security robot unzipping or unsnapping personal luggage and then rifling through searching for illegal objects and then closing it back up again.

All of this activity is online and heading for a bright robotic future and I haven't even mentioned the healthcare field where robotic assistants of all types are flourishing and in line at the FDA and European CE agencies awaiting approvals... but that's another story next month.