By Tiernan Ray for Barron's: Bernstein Research’s Alberto Moel, who follows tech-industrial companies such as Corning(GLW) and AU Optronics (AUO), this afternoon offered up a thinks piece on robotics andfactory automation, arguing that some of the costs of automation beyond the basic cost of the robot are about to get dramatically cheaper, thanks in large part to artificial intelligence akin to what Alphabet (GOOGL) and others are doing.
Moel notes that the basic components of factory robots are only falling by perhaps 6% per year, their cost reduction bounded by things such as casings and servomotors and reduction gears that don’t rapidly fall in cost.
But, writes Moel, the cost to install and adjust these machines on a factory floor is ten times their component cost and that stuff can be reduced more dramatically:
How much this integration costs varies widely. An often-cited rule of thumb is that a $50,000 robot will need $500,000 of integration costs before it is all said and done. Of course, these integration costs can be amortized over many robots, so perhaps a better estimate would be 3-5x the robot cost [...] But I do believe we are at an inflection pointthat will materially increase the capability of automation systems and substantially reduce programming, setup, and fixturing costs which are the largest cost element in most automation efforts. So instead of a measly 6% YoY cost reduction , we get 25-30% YoY declines, and automation Nirvana. Cont'd...
By Charles Orlowek for The Hill: Good news? Boston Consulting Group foresees more large manufacturers boosting production for the American market by adding capacity in the U.S. itself, compared with any other country. It cites “decreasing costs and improved capabilities of advanced manufacturing technologies such as robotics." Under this optimistic scenario, how much value would American workers add? When robotics and other automation gets built for, and installed in American workplaces, where are jobs created?
Increasingly, these jobs are being created and sustained outside the United States, even for domestic factories.
The first industrial robots were developed and manufactured by Americans, and General Motors became the first user, in 1961. Over recent decades, however, the domestic robot industry has declined. A Commerce Department national security assessment from 1991 asserted that American robot manufacturers lost market share throughout the 1980s, with shipments of U.S.-manufactured robots falling by 33 percent between 1984 and 1989, despite robust domestic demand and a weak dollar. Cont'd...
SEAN MCLAIN for WSJ.com: Foxconn became the latest global giant to declare its intention to tap into India’s budding manufacturing potential.
The company is looking for manufacturing sites in India. So far it hasn’t been able to settle on any in particular, Foxconn Chairman Terry Gou told a news conference in New Delhi.
“India is a big, big country. Too many places, too many states, too many cities. The choice is difficult,” he said.
Foxconn is the world’s largest contract electronics manufacturer by revenue. The Taiwanese company—known officially as Hon Hai Precision Industry Co.—is looking to tap India’s massive labor pool and has big ambitions for its Indian investments. It has long-term plans for Asia’s third-largest economy and hopes to do more in India than simply assemble smartphones and laptops. “We want to bring the whole supply chain here,” Mr. Gou said.
Analysts say Foxconn is looking to diversify its global network of factories as the company faces more competition and rising wages in China, where it has most of its manufacturing operations. Cont'd...
GĂĽdel and ATI Industrial Automation Announce New Coupling Technology for 3-axis Press Transfer System
Festo Showcases Innovation Integrated Solutions for Semiconductor and Solar Energy OEMs at Semicon West 2015
By TIMOTHY AEPPEL and MARK MAGNIER for WSJ.com - Having devoured many of the world’s factory jobs, China is now handing them over to robots.
China already ranks as the world’s largest market for robotic machines. Sales last year grew 54% from a year earlier, and the boom shows every sign of increasing. China is projected to have more installed industrial robots than any other country by next year, according to the International Federation of Robotics.
China’s emergence as an automation hub contradicts many assumptions about robots and the global economy.
Economists often view automation as a way for advanced economies to keep industries that might otherwise move offshore, or even to win them back through reshoring, since the focus is on ways to reduce costly labor. That motivation hasn’t gone away. But increasingly, robots are taking over work in developing countries, reducing the potential job creation associated with building new factories in the frontier markets of Asia, Africa or Latin America. Cont'd...
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