Emerald Group Publishing Limited
Copyright © 2000, MCB UP Limited
"New phase" hits robotics for material handling markets, as technological developments soar
Keywords: Robotics, Materials handling
Rates of technical change are mounting in the European robotics for material handling markets, providing manufacturers with opportunities to exploit untapped markets and expand current applications. The industry is evolving in a dynamic fashion while sustaining growth, according to a new study by Frost & Sullivan, the international marketing consulting company.
The market is beginning to profit notably from the usage of robotic products that incorporate machine vision systems, thereby significantly raising both productivity and quality standards in a number of emerging application areas. The reduction in mechanised machinery and fixtures among end-users, via the advances in robotic technology, is also proving a key driver. In contrast, high installation costs and competition from conventional automation are factors that continue to challenge manufacturers.
Frost & Sullivan calculate the compound annual growth rate for the market to hit 3.8 per cent during the forecast period (1999-2006). Projections assess that market revenues will rise from US$424.0 million in 1999 to US$551.4 million by 2006. As growth and technological developments press forward, the market will enter a "new phase". The reality of this will be a sharp increase in the number of new applications available for flexible automation. As the range of applications broaden, end-users will continue to realise the benefits of these technologies.
Germany is by far the most important market with a market share in excess of 41 per cent, followed by Italy with 25 per cent of the market. However, owing to early adoption of robotic technology, investment in these two countries will slow down over the forecast period. As investment slows and other European nations embrace robotic technology at a faster rate, these two leading countries will see erosion in their market share.
The market for parts transfer robots is undoubtedly the largest sector, achieving 62.9 per cent of market share in 1999. The segment's dependency on the automotive industry is expected to decline over the period in question, helping to alleviate fluctuating growth due to erratic cyclical investment. This segment and the remaining markets for machine loading/unloading, packaging and palletising robots will all experience growth over the forecast period.
Increases in the rate of technical change are being facilitated by increases in power, speed and more efficient programming processes. However, the sheer pace of such change is proving problematic in terms of pricing structures. Frost & Sullivan research analyst, Brian Flannery, comments: "In fact the technological advances in robotics are rising at a faster rate than their prices and, in some instances, prices are actually falling as the performance increases."
The market leader in Europe is ABB Flexible Automation, followed by KUKA Roboter and Comau. Larger manufacturers tend to enjoy particular advantages in the negotiation of joint supply deals with machine vision system manufacturers. In terms of these arrangements, less dominant players often find it difficult to compete not only on price but also on reputation. However, as the recent spate of mergers and acquisitions illustrate, competition is intensifying across the industry.
A major issue among end-users is product reliability, owing to its fundamental role in creating an efficient production process. Robots can provide management with predictable levels of output, free from many of the pitfalls that can be associated with other methods of production. As a result, reliability is often a key driver behind the purchase decision.
The European robotics for material handling markets is expected to remain in a period of sustained growth. However, growth rates will be adversely affected by the slowing down of investment from the two major country markets, Germany and Italy. As technological developments rise and end-user expectations grow, the benefits of using such advanced technology will be further recognised. The strengthening of product quality will inevitably be a strong basis on which manufacturers will look to compete. Strategic options for market participants include the pursuit of mergers/acquisitions and continued research and development.
Frost & Sullivan is an international marketing consulting company headquartered in Silicon Valley, California. The Frost & Sullivan Industrial Business Unit monitors the industrial market for trends, measurements and growth rates. This study is utilised to update a series of online research such as Industrial Robotics Simulation and Control Software Markets – No. 7194-10 and US Robotics Markets – No. 5398-10. This is complemented by support for industry participants with custom consulting needs. Free executive summaries of all Frost & Sullivan reports are available to the press.
Report code: 3812-10, Publication date: June 2000, price: 3,950 euros.
Internet home page: http://www.frost.com