China Market Insider The Kuka model sets a precedent

Related Vendors

Asia Waypoint

FAULHABER Drive Systems

Taiwan Machine Tool & Accessory Builders' Association (TMBA)

Wuxi InfiMotion Technology Co., Ltd.

After Midea and Kuka, another Chinese giant from consumer electronics is now entering the robot market.

Haier takes over the majority of the robotics company Step Electric. For the acquisition, the major Chinese consumer electronics manufacturer invests around 330 million euros (357 479 100.00 USD). This is shown by stock exchange documents in Shenzhen.

The industrial robot sector in China is growing so rapidly that after Midea's acquisition of Kuka in 2017, the second giant in Chinese consumer electronics now also wants to profit from the business.

Haier grew large by manufacturing washing machines and similar electronics, but has been intensively working on diversifying and modernizing its business model for a decade now.

For example, last year Haier collaborated with a Chinese company to develop the bipedal household robot "Kuavo," which is happy to assist with laundry and watering plants. Now, Haier aims to profit from the sale of industrial robots as well.

Unlike the Kuka acquisition back then, investors from China now no longer need to travel to distant Bavaria to gain access to cutting-edge robotics technology. A short flight from Tianjin, where Haier has its headquarters, to Shenzhen, which borders Hong Kong, suffices.

Founded in 1995 and based in Shenzhen, Step Electric initially started with the construction of elevators but then shifted towards the manufacture of industrial robots. Today, it offers both hardware and software for the automation of the manufacturing industry in various sectors, from electronics to the automotive industry, from the semiconductor industry to "Embodied AI" in humanoid robots.

Haier, one of China's most interesting publicly traded companies, demonstrates with its investment in Step Electric that it anticipates growth opportunities through Beijing's determined course of modernizing its manufacturing industry.

Hardly any other country in the world is currently automating its manufacturing industry as quickly as China. Recently, the People's Republic has overtaken both Japan and Germany in the adoption of industrial robots.

China in the top 3 for the use of industrial robots

In China, there are 470 robots per 10,000 employees, according to the latest report from the "International Federation of Robotics" from last year. This ranks third globally, after South Korea and Singapore. In Germany, there were 429 industrial robots (4th place), and in Japan 419 (5th place).

In the U.S., whose hostile attacks on China with boycotts, sanctions, and tariffs have further accelerated the state-orchestrated modernization push in the People's Republic, enthusiastically supported by private companies like Haier, there are 295 industrial robots per 10,000 employees. This corresponds to the eleventh place in the global ranking.

Of course, the ratio of industrial robots to workers is only one of many data points, but it is a useful indicator of the state of automation in a country's manufacturing industry, and thus the pace at which the profitability of its leading manufacturers in all industrial sectors can grow.

In China, more than half of all industrial robots worldwide are now installed (51%). The People's Republic also saw the most industrial robots put into operation globally in absolute numbers. More than 294,000 new robots were deployed in China last year.

This dynamic in demand does not leave the situation of industrial robot manufacturers, that is, the supply side, unaffected. This also applies globally—to the entire world market for industrial robots. While the "big four" in the industry—ABB, Kuka, Fanuc, and Yaskawa—are still considered technological leaders, Chinese manufacturers like Step Electric are catching up rapidly in terms of both market shares and quality.

For the first time, Chinese manufacturers sold more industrial robots in their home market in 2023 than foreign competitors. In 2024, the share of Chinese producers in the Chinese market was 52.3 percent, according to statistics from the MIR Databank.

This "reversal of market share," meaning the overtaking of foreign robotics manufacturers by Chinese manufacturers in their home market, which the economic portal "Diyi Caijing" referred to as a "historic moment," does not present the full picture.

The "big four" are investing heavily in artificial intelligence applications or shifting their focus to lucrative, fast-growing niches. ABB, for example, has established its own AI institute. Yaskawa is focusing more on industrial robots for the medical and food & beverage sectors, while Kuka is investing more heavily in the AMR (Autonomous Mobile Robots) sector in the People's Republic.

Chinese manufacturers are also catching up in terms of quality

But as the recent surprising success of the startup Deepseek with its self-developed language model (LLM) in China has shown, it is very clear where the journey is heading. The times when manufacturers in Germany and Europe could comfort themselves with the statement that they still build the better robots are definitively over.

While the "big four" are fighting hard to remain one step ahead of the Chinese competition technologically, Chinese robotics manufacturers are simultaneously consistently catching up in terms of quality.

Not only is the number of industrial robots manufactured in China and used in China's manufacturing industry achieving new records, but Chinese companies are also rapidly improving in key technological areas such as motion control, high-performance servo drives, and high-precision gearboxes for robots and cobots.

Secure and Compliant Authentication in Laboratories

Secure & Contactless User Authentication at GMP/GLP

*Henrik Bork is the Managing Director at Asia Waypoint, a consultancy specializing in China, based in Beijing. "China Market Insider" is a joint project of the Vogel Communications Group, Würzburg, and the Jigong Vogel Media Advertising in Beijing.