Tuesday, November 12, 2024

Robot Start-ups In China Are Feeling The Pain

Robot Start-ups
Using its glowing blue eyes and trusting feline features, the new robot cat by Chinese startup Elephant Robotics seems happily oblivious to the worries of CEO Joey Song as he shows it off at the company's lab in Shenzhen.

Elephant Robotics' main business is the automation of factory assembly lines but revenue has plunged by a third in 2022 due to the coronavirus, leading the company to cut staff by a fifth.

"It's tough," said Song. "Before, we had more than 30 people."

Due to the downturn, the firm is still struggling to put more energy into the robot cat project funded on Kickstarter. Readying its first large batch of 1,000 cats for sale, it hopes that as more consumers work from home, interest in pet robots will grow.

"If the industrial robots can't sell right now, we just focus on other robots to lower the risks," Song said.

Interest in robots has surged worldwide as the pandemic forces hospitals, manufacturing and services companies as well as governments to look afresh and with new urgency at ways to minimise human contact.

But in China, months ahead of many countries in reopening its economy and the world's biggest market for industrial robots, new business seems largely limited to robots for warehouses and disinfecting. Most clients are now too spooked by the uncertain business climate to invest in expensive factory gear, industry executives say.

"Automation should be a way to fight virus consequences but on the other side if you want to invest, you need to know the market forecasts," said Vincent Bury, managing director at equipment maker CNIM China. "Nobody has a crystal ball now."

China's industrial robot sales tumbled by a fifth in the first quarter from a year earlier, according to Shanghai-based consultancy Stieler Enterprise. It predicts second-quarter sales will likely decline 15 percent.

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