China’s High-Tech Industry: Opportunities & Challenges (Part 2)

Outline • Research and thinking on hi-tech clusters • Past 30 years & next 30 years • Cast studies: Silicon Valley, MIT, Israel, Taiwan • Shenzhen-Hong Kong Bay Area: Next Silicon Valley, new opportunities • The only road that leads Chinese manufacturing to success – Technological Innovation + Industry 3.0/4.0 • Status quo of the manufacturing industry – a corporate survey with the largest samples • A rising industry • A few cases: Dreams, studies & startups • New advantages for China’s technological innovation

3. A New Era in Robotics A rising industry: Robot Age – the US  Google  Schaft  Industrial  Redwood Robotics  Bot & Dolly  Meka Robotics  Holomni  Boston Dynamics Google Self-driving Car  Amazon  Qualcomm  Obama: The rise of US manufacturing supported  The Economist: March 2014 by smart robotic technologies  “ A Roadmap for Robotics— From Internet to Robotics (2013 Edition)”  Manufacturing  Healthcare  Medical  Service, Space and Defense 2

Core Technologies 1. Driving Motion Control Technology 5.Visual -Electric Machines (Mitsubishi, -CMOS/CCD Yaskawa, Panasonic) 2.Tranmission 3.Contorl 4.Remote Sensor -Lence/camera (DJI) • CCD -RV(Nabtesco) -Controller (Googol, Keba, B&R) -Force sensor -Signal treatment, • AC servo motor -Harmonic wave (Japan -Human- computer -Encoder (straight, revolving) compressed transmission • Direct HD, Greenland Suzhou) interface -IMU/Gyroscope DJI Drive motor Other gear reducer -GPS (Servotronics etc.) - bearing, screw, guide rail -Laser radar 6.System software 7.Communication 8.Chip 10.Motor -RTOS -bussing technology -Control chips (Pinko) 9.Structuring -Battery management -ROS, etc. -wireless communication -Image chips -Modeling(Li Qun) -Charging tech (DJI) -Transmission chips(Pinko) -Structural design -Emulation tech 1.Robot machines 2.Industry robots 3.Healthcare/medical robots) 4.Autonomous vehicles 5.Consumer robotics Machine tool Industrial design and Home (navigation and wheel tech) UAV E-manufacturing emulation Surgery Google UUV Testing tools Recovery AGV Water-surface robot Textile equipment …… Mobile manipulator …… System integration tooling, fixture crafting, emulation 3

Motion control Equipment making Rising of a country • Manufacturing development and prosperity (30 – 50 years) Development and application of the equipment industry (30-50 years) UK (1710-1850, 40 yrs) Steam engine (1712-1714) – train (1825) – Great Eastern (1858) US: AC Motor (1888) – Airplane (1903) – CNC Core technology in equipment making: talents Machine tools (1947) – first industrial robot (1961) and industry (30-50 years) Japan: Taking the lead in developing its motion control industry (YASKAWA, Fanuc) 50 -110 years

P1: Smart Robots for Manufacturing Automation Current State: China industrial robot market: 2005-2022 05-12: Growth 30% 05-12: Growth 25%

2. Insights into Data on Industrial Robot Market in China & Key Factors Key Factors Labor Robot 因素6:工业机器人成本将以每年4%减少 Resource Cost Productivit Resource Cost Productivity y 2012 120 million RMB50,000/year  90,000 SCARA/system  Manufacturing (US$559/month) RMB60K/120K growth: RMB15.6 US: US$3600/month (5-month salary) trillion (1:6.44) RMB: US$ = 6.2:1 6-DoF (3kg) RMB120K/240K (1.2-year salary) 2022 100 million RMB200,000/year  1.7-3 million SCARA/system  Manufacturing (US$3371/month) RMB42/84K growth: RMB29 US: US$4388/month (2.5-month salary) trillion (1:1.3) RMB: US$ = 5:1 6-DoF (3kg) RMB84K/168K (5-month salary) RMB13.5T 22 mil RMB150K/year Conclusion: 1. The market demand for industrial robot is rigid and ongoing 2. The development of industrial robot will be one of the greatest revolutions in China’s history of manufacturing, with profound implications 3. China is arriving at the critical mass of industrial robotics

3. Dances with Wolves: Strengths & Weakness in Local Industrial Robotics Industry System Industry User Industry A Industry B Industry C System integrator Body plant Parts & Motor Decele Control Sensor Softwa components rator ler re manufacturers Universities/ institutes

3. Dances with Wolves: Strengths & Weakness in Local Industrial Robotics  Dancing with “the Wolves:” Strengths & Weakness of Industry Domestic Industrial Robotics Industry 1. Huge gap between university research and industry needs in terms of knowledge and research interests 2. The core parts and components industry is at its early stage and needs time to grow 3. High cost structure in body plants, lack of competitive advantage 4. Insufficient system integrators in terms of quality & experience. E.g. For example, there were 100 system integrators working with ADEP Therefore, 20+20=40 body plants require 4,000-8,000 integrators, compared to 1,000 integrators at present 5. Though users face enormous pressure in productivity, labor and competition, they still have their concerns in potential risks brought by new technologies. Manufacturing cost in Small-size production Yaskawa’s 2009: cost in 2012: manufacturing cost: RMB320K RMB254K RMB168K Sold at RMB220- 270K

Our Opportunities 3C Industry: • Workers: 2,00mil Car industry: • Robot coverage : 11/10k worker • Output: 1,60Mil (Global: 70Mil) • Annual output • Workers:3-5mil  Cellphone: 2bil  Computers: 5bil • Robot coverage:141/10k workers  Consumer electronics: ? (Japan: 1450) Requirements: Requirements: • Precision: <30 micron • Precision: >100 micron • Flexibility, smart, nimble • Capacity:Large • 2-3week cycle – adaptibility • Position control • Light, safe, low cost Major Suppliers: • Major suppliers: ? ? ? ? • ABB, KUKA, Yaskawa, FANUC