Plans in China to build 100,000 industrial robots p.a. by 2020
China wants to go from being a "low-cost labour source to a high-tech labour source", thanks to its Made in China 2025 initiative and the Robotics Industry Development Plan. By 2020 the country wants to manufacture 100,000 industrial robots annually and it is already the world's largest market for them. By 2019, 40% of total worldwide robot sales are forecast to be in China, up from 27% in 2015. The country is increasing investment into the sector, as well as offering subsidies, low-interest loans and rent-free land to Chinese robotics companies.
Industrial robots 'dance' at a booth at the China International Industry Fair at National Exhibition and Convention Center in Shanghai. VCG | VCG | Getty Images

About four years ago Jeff Burnstein attended his first China International Robotics Show, the annual Shanghai-based expo now in its seventh year. At the time, Burnstein, president of the Robotic Industries Association, a Michigan-based trade group, wasn't impressed. He said he walked around the show and thought many of the robots on display looked like copies of what American companies were already doing. In today's China a different picture is taking shape, courtesy of a blueprint known as the Made in China 2025 plan. Announced in 2015, the initiative is China's massive government-backed push to be a world leader in a number of high-tech industries, such as medical devices, aerospace equipment and robotics — the key piece of the country's desire to automate sectors of its economy: automotive manufacturing, food production, electronics and more.

But to do that, China needs more robots. In addition to the Made in China 2025 plan, the government has also released the Robotics Industry Development Plan, a five-year plan to rapidly expand the country's industrial robotics sector. By 2020, China wants to be able to manufacture at least 100,000 industrial robots annually. The country is racing full steam ahead to a robot-powered future in a push to not only remake its own economy but also to transform into the world's robot capital — overtaking Japan, Germany and the United States in the process. "The Chinese are the fastest-growing and largest user of robotics in the world by now," said Burnstein. "The 2025 plan will only accelerate it." According to the International Federation of Robots, China is already home to the biggest share of robots, a global market worth about $30 billion. It is currently ranked the No.1 sales market for industrial robots, with the United States coming in at No. 4. (South Korea and Japan are two and three, respectively.)

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While the United States is arguably the worldwide leader in automation in vehicle manufacturing, China is quickly making gains to outstrip the U.S. and other global competitors. Over the first half of this decade, China installed 90,000 industrial robots, or one third of the world's total, compared to 80,000 industrial robots installed between 2010 and 2015 elsewhere in Asia, Europe and the United States combined.

A heated race

"To reduce the threshold of innovative entrepreneurship, the government provides appropriate financial subsidies for rent, broadband access and public software for new businesses," said John Rhee, general manager of the Los Angeles office for UBTECH, a Chinese robotics company headquartered in Shenzhen City that makes humanoid robots for the home.

Fast-forwarding market domination

UBTECH is one such company currently benefiting from the Made in China 2025 plan. In April the company signed a "strategic cooperation agreement," Rhee said, with the municipal government of Kunming City in the southwestern province of Yunnan, which will aid the company in robot building and developing artificial intelligence capabilities in Yunnan province for the purpose of making Kunming and other municipalities A.I.-enabled "smart" cities. But how quickly China can get itself up to speed in the globally competitive robotics field is still a question, as is the overall effectiveness of the Made in 2025 plan on growing China's robotics industry. "China can manufacture simple robots but nothing complicated, like the six-axis ones by Japan, Germany and the U.S.," said Zi Yang, a China analyst at the Washington, D.C.-based Jamestown Foundation. "It's hard to close the gap due to several reasons, mainly because of China's lack of innovativeness due to its weak intellectual property laws and government-led projects that focus on quantity over quality." Indeed, that push for quantity is one of the aggressive goals China has set for itself in its Made in 2025 plan. By the end of next decade, the country wants to be producing 400,000 industrial robots annually. That's a tall order, considering just a little more than 250,000 industrial robots were sold the world over in 2015 alone, according to the IFR. Some Chinese companies are actively buying the expertise in robotics that has been developed elsewhere. One such company, Midea, closed a $4 billion deal earlier this year to acquire Germany-based Kuka AG, a leading, global robotics supplier for plant and automotive robots with a research and development center in Austin, Texas.

China's Midea recently acquired Germany-based Kuka AG, a global robotics supplier for plant and automotive robots with a research and development center in Austin, Texas. Source: Kuka Industries