Increases in the performance and price of robotics will slash manufacturing costs by up to a third in the world’s top exporting countries over the next ten years, a study by management consultancy the Boston Consultancy Group has found.
A “confluence” of rapidly dropping costs and faster and more flexible robots will cause the sector to “takeoff” in the short term and provide a “productivity surge” in places such as South Korea, China, the US, Japan and Germany.
However, countries that lag in robotics investment, such as France, Italy, Belgium and Brazil are likely to see their competitiveness deteriorate during the same period, the study found.
Micheal Zinser, colead of Boston Consulting Group’s (BCG) manufacturing practice, said: “For many manufacturers, the biggest reason for not replacing workers with robots has been pure economics and technical limitations. But the price and performance of automation is improving rapidly. Within five to ten years, the business case for robots in most industries will be compelling, even for many small and mid-sized manufacturers.”
Advances in vision sensors, gripping systems, and IT are driving improvements in price and performance, making robots smarter, highly networked, easier to program and more useful in a variety of applications, said the report. For example, the cost of a robotic spot welder has fallen 27% between 2005 and 2014, from $182,000 to $133,000 and is predicted to fall a further 22% by 2025.
In addition, industrial robots still only perform on average 10% of manufacturing tasks in a factory, despite being in use for decades. By 2025 the amount of “automatable” tasks will have risen to an average of 25% for all sectors worldwide, the report predicts.
Companies in China, the US, Japan, Germany and South Korea account for almost 80% of all robot purchases and this is likely to remain the case during the next ten years, the study suggested. Labour costs in South Korea, which is an “aggressive adopter” of robotics could reduce by up to 33% in 2025 compared to 20% in countries such as the UK, US, Taiwan and Germany.
Countries that are slow to adopt robotics in industry but have low labour costs, such as Mexico and India, are unlikely to lose competitive ground, the report says. However high-cost economies with inflexible labour laws, such as Belgium, France, Italy and Brazil, will lag in automation uptake and suffer from lower productivity as a result.
Harold Sirkin, a senior partner at BCG and co-author of the report, titled “The shifting economics of global manufacturing”, said: “Regardless of whether its time to invest in next-generation robots, manufacturers everywhere should start preparing. They need to understand how costs and automation technologies are changing in their industries and what their competitors are up to. They need to start training their workforce. The coming robotics revolution could significantly reshape the global manufacturing landscape.”
