China’s Robotics Industry Amidst Coronavirus Pandemic

China's robotic technology

The coronavirus pandemic is a black swan event that affects the world in many ways. The robotics technology in China is not an exception. The pandemic affects it significantly. As the situation unfolds, it is clear that it presents both challenges and opportunities for the industry.

China’s Robotics Technology in Brief

The industry is divided into three segments: service robotics, industrial robotics, and special service robotics.

  • Service robotics

These are robots used for non-manufacturing purposes. For example, for household, medical, public service, agriculture, and logistic purposes.

  • Industrial robotics.

These refer to robotic equipment used in manufacturing settings. This segment consists of robotic arms, collaborative robots, and autonomous mobile robots which are used to automate assembly lines in factories.

  • Special service robotics

These are robots used for special conditions such as hazard rescue robots and drones.

Before the coronavirus pandemic, the robotics industry in China experienced slow growth. This slow growth is caused by a slowdown in the industrial robotic segment, more than half of which is the local market

The slowdown is projected to be replaced by growth as the pandemic is seen as an accelerator of change. It brings about both challenges and opportunities.

Challenges and Opportunities Amidst the Pandemic

Challenges and Opportunities Amidst the Pandemic

  • Challenges

The coronavirus pandemic impacts the global economy negatively. In the industry of robotics, this is evident from the sharp fall of start-up funding in early 2020. There is a decent recovery after the fall, but the industry as a whole is still affected negatively.

Both earlier- and later-stage start-ups are struggling but for different reasons. Earlier-stage start-ups struggle with finding funding as they have less-proven track records and business models while later-stage start-ups struggle with higher fixed costs and a discounted valuation.

Industrial robotics experienced strained finances in factories. While this impacts the industry negatively, in the long term, it might cause labor shortages as market acceptance will open and demands will increase.

  • Opportunities

The pandemic brings harsh times for everyone. However, start-ups that have a flexible business plan and excellent execution can brave through these times, turning the global pandemic from a blocking stone to a stepping stone.

The pandemic disrupts the industry of robotics in many ways, but not all are negative. For example, there is a significant increase in service robotics demand in medical applications and logistics.

This demand is projected to persist in the long-term as the pandemic resolves. In the long term, both penetration rate and widening applications are projected to grow as well.

The pandemic also leads to improving the efficiency of robotic automation as well as reducing human-touch. Both of these will see a wider application in various industries. Among them are the healthcare, hospitality, and manufacturing industries.

While in the beginning the pandemic negatively impacts the industry, it acts as an accelerator of change. It accelerates the adoption of new technologies as people are getting used to new behavior in utilizing robotics solutions.

The global pandemic disrupts the robotics technology in China. For example, on one hand, the pandemic causes contraction. On the other hand, there is an increasing demand for service robotics to minimize contact. The situation that the pandemic creates brings not only challenges but also opportunities for the industry.

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