Robots already have a significant impact on logistics and supply chains, and that will only get more and more as technology advances. China’s increasing labor costs have pushed manufacturers to invest and use robotics more in their daily operations.
Human labor is no longer cheap in China as it used to be – especially compared to the other rival manufacturing countries in Asia, such as Vietnam, Thailand and Indonesia. All these countries’ human labor cost is less than half of what it costs in China’s urban centers.
Since China’s worker population started to shrink, manufacturers were forced to turn to automation. The United Nations estimates the number of the country’s workers peaked in 2010 at more than 900 million and will fall below 800 million by 2050.
In 2013, China became the world’s largest market for industrial robots
In 2013, China became the world’s largest market for industrial robots, surpassing all of Western Europe, according to the International Federation of Robotics. In 2015, Chinese manufacturers bought around 67,000 robots, and demand is projected to more than double to 150,000 robots annually by 2018.
According to the International Federation of Robotics, more than 67,000 industrial robots were sold in China in 2015. China, by far the biggest market for industrial robots, is also the fastest growing market worldwide. This rapid development is unique in the history of robotics. There has never been such dynamic rise in such a short period of time in any other market. A wide range of industries have been increasingly investing in automation. Between 2010 and 2014, total supply of industrial robots increased by about 40% per year on average.
Replacing humans with machines is not an easy transition. Robots and automated technologies have existed for a long time. They have mostly been used to increase productivity. With the help of developing technologies, artificial intelligence is becoming more real and usable. Nowadays, robots are able to perform decision-making tasks and these tasks will only grow in the future.
There are lots of advantages to using robots
Here are some functional advantages of robotics:
- Reduced operating costs
- Improved product quality
- Reduced labor turnover
- Improved production output
- Improved safety and health
- Reduced space utilization
Since September 2014, 505 factories across Dongguan, in the Guangdong province, have invested around $430M in robots, aiming to replace thousands of workers. Apple and Samsung supplier Foxconn had already replaced its 60,000 workers with robots.
Robots will definitely help to keep costs at a minimum for China’s mass production – and reboot it. That will also help China to stay competitive with other cheap labor countries in near future.