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by Maria Trombly, Contributing Editor Posted on Monday, October 30, 2006 3:01:14 PM   | Abstract: | Though its purchasing power may be on the wane, the automotive industry is still the primary buyer of robotics products. With China's automotive sector showing strong growth, ABB's robotics group moved its headquarters to where the action is. |
In yet another sign that China is now at the forefront of manufacturing, ABB Robotics has moved its world headquarters from Detroit to Shanghai, China. ABB Robotics is part of Switzerland-based ABB Group, and is a world leader in automation technology. Decades ago, the company was the first to market a microcomputer-controlled, all-electric industrial robot. According to Anders Jonsson, ABB executive vice president and head of its robotics division, the booming Chinese automotive industry was one of the reasons for ABB's move to Shanghai. "The automotive industry still remains the largest consumer of robots today," he said at an April press conference in Shanghai. The move also will place ABB closer to the growing Chinese market than its competitors in Japan. One of ABB Robotics' biggest rivals, Yaskawa, is based in Japan. For a variety of reasons, including politics, Yaskawa is not likely to move its headquarters to China, giving ABB both a symbolic and practical advantage in this fast-growing market. Fertile Ground The automotive sector is currently ABB Robotics' largest consumer and many of ABB's clients -- including Toyota, GM, Honda, and Volkswagen -- have set up shop in China. Chinese auto makers like Geely have also begun using ABB robots on their production lines, ABB says. "We are forming more and more partnerships with Chinese companies as they realize that the key to keep winning in the future is solid competitive strength," Jonsson said at the April press conference. The robotics division is one of ABB's five core businesses, and contributed $1.7 billion to the group's total revenue of $22.4 billion in 2005. The company reports that is has already sold more than 3,000 robots in China, and claims to have the largest market share among international robot suppliers there. And sales are increasing at 20% annually, the company says -- compared to single-digit growth in other geographies. ABB isn't alone in following its customer base to China. Automation companies like Rockwell, Siemens, and Schneider have also entered the Chinese market. But ABB's history in China probably dates back further than most. The company traces its connection to a steam boiler sold to the country in 1907. More recently, ABB set up an office in Hong Kong in 1974, followed by a permanent location in Beijing in 1979. Today, ABB has more than 8,500 employees in China, out of about 104,000 worldwide, and sales and service offices in 30 Chinese cities. In particular, ABB Robotics has over 300 employees, all located in Shanghai, as well as a factory and a network of suppliers. In 2005, China passed Germany to become ABB Group's second-largest market, trailing only the United States. The company plans to more than double its sales in China, to $4 billion by 2008 -- which would make China its largest market in the world. ABB Group says it plans to hire more than 5,000 additional employees in China over the next two years and to invest more than $100 million in new product lines and factories. "Most auto markets globally are mature and the growth has leveled off," says ABB spokeswoman Grace Nan. "Take Japan, Western Europe, and North America, for example. We predict that there won't be much change in those markets in the next three years," Nan says. "But China is completely different. We see that there is a huge potential challenge here -- more and more companies want to take part in China's fast-growing automotive industry. So does ABB. We want to embrace this opportunity as soon as possible." Page : 1 2 3 ... NEXT |