The problem
Manufacturing robots have failed to revolutionize manufacturing. Not withstanding repeated predictions that robotic manufacturing would be disruptively transformative, there are few true robotic factories. The use of robots in mass manufacturing has been plagued by serious limitations in effectiveness.
“Cheap labour” continues to be a perceived advantage in manufacturing, accounting for factories scattered around the world in low-wage countries. Complex global supply chains are still necessary to deliver competitively priced consumer goods.
Importance and scale
Even though manufacturing has declined as a relative proportion of total economic output, it remains both strategically important and still massive in absolute terms. While the service economy represents the majority of economic output, most of its services require sophisticated physical infrastructure and manufactured equipment, devices and machinery. The affordability of these manufactured goods is a powerful determinant of service sector profitability. For example, while online gaming is a strongly growing sector, the infrastructure and equipment to support it can be very expensive. We should not forget that the massive “virtual” economy is highly dependent on cost-effective server farms/data centres.
The industrial manufacturing robotics market was characterized as a $38.1 billion global market in 2016. Market research provider MarketsandMarkets forecasts this industry could grow to about $71.7 billion by 2023. The industries covered include automotive, electronics, plastics, chemicals, food and beverages, pharmaceuticals, cosmetics, and precision engineering such as optics.
Globally, in 2017, there were about 125,000 new robots added to the automotive industry; 116,000 in the electronics industry; 44,000 in the metal manufacturing industry; 21,000 in rubber and plastics; and 10,000 industrial robots were added in the food manufacturing sector. Note – there were around 65,000 additional industrial robots added in 2017 that have not been classified under specific industries.
In Canada, automotive manufacturing robots account for nearly 50% of industrial robots sold in the country. Electronics manufacturing robots account for just over 25%, followed by metal and machinery manufacturing robots (11.7%), rubber and plastics robots (8.7%), food and beverage robots (4.4%), and pharmaceutical/cosmetics robots (1.4%).
A thing to remember about businesses who may become customers of the robotics industry is there are a variety of factors that affect the decision to adopt robots over humans. These factors could include: the size of the business, how competitive the industry is, and the cost of investing in robotics versus the cost of human labour. For example, according to IBISWorld, US automotive manufacturing is “one of the most capital-intensive manufacturing industries,” and manufacturers invest about $0.48 on capital equipment for every $1 they spend on labour.
In terms of the scale of robotics in manufacturing, we can look at the density of robots compared to human workers. In this case, in 2014, South Korea led the world with about 450 robots per 10,000 workers. Japan and Germany trail behind with about 325 and 300 robots per 10,000 workers, respectively. The remaining countries ranked in the top 13 include Sweden, Denmark, Belgium, the US, Spain, and Canada (13th) with over 100 robots per 10,000 workers.
Additional project details
More information about this project will be shared during the kickoff meeting. Students will receive all the details they need at that time.