The Three Pillars of the Robot Industry... Companies Armed with 'Investment' Take the Lead [Tech War, The Birth of Advanced Nations]

Robot Industry Sales 5.4 Trillion Won... Growth Rate Low at 2.6%
98.5% of Related Businesses Are SMEs, Domestic Market Growth Stagnant

Source: 2020 Robot Industry Survey

[Asia Economy Reporter Sunmi Park] President Yoon Suk-yeol has promised bold regulatory innovation with the goal of making Korea one of the "top three robot powers in the world." In response, companies are embracing robots as future growth engines to lead the Fourth Industrial Revolution era and are matching this vision with aggressive investments. Korea's robot industry is currently experiencing slow growth in the number of businesses, sales revenue, export volume, and workforce. However, given its excellent technological capabilities, there is optimism that with accompanying investment and regulatory innovation, Korea can certainly achieve its goal of becoming one of the world's top three robot powers.

◆ Robot market growth limited to 2.6% annually... market size of KRW 5.4736 trillion = According to the Robot Industry Survey on the 27th, Korea's robot industry sales amounted to KRW 5.4736 trillion in 2020, marking only a 2.6% increase compared to the previous year. Compared to 2018, when sales reached KRW 5.8019 trillion, the market size has actually contracted. By sector, manufacturing robots account for the largest share at 52.4%, followed by robot parts and software at 32%, professional service robots at 8.4%, and personal service robots at 7.2%. Currently, there are 2,427 robot-related businesses, 98.5% of which are small and medium-sized enterprises (SMEs). Given this situation, more than half?69%?of these businesses have sales under KRW 1 billion.

Although the robot market growth is stagnant, Korea's robot technology is within reach of catching up to advanced countries. The Korea Institute of Science and Technology Planning and Evaluation analyzed that, based on the European Union (EU) as the benchmark for the highest technological level in 2020, Korea's technology level is about 80% of that, with a technology gap of approximately 2 years and 6 months to 3 years. If bold capital investment by companies, government regulatory innovation, and nurturing of research personnel are supported, Korea's robot industry, which is still in its early growth stage, can leap to the level of advanced countries.

In fact, large corporations have included the robot industry as one of the future growth engines in their bold investment plans for fostering advanced industries aligned with the new government’s inauguration. This opens the door for large-scale capital and research personnel to be invested in the robot industry, which is mainly composed of SMEs.

◆ Robot technology diversifying beyond ‘robot vacuum cleaners’ to delivery and logistics support = LG, which launched the first robot vacuum cleaner by a domestic company in 2003, is making efforts to diversify the forms and functions of robots, including guide robots, serving robots, sterilization robots, and lawn-mowing robots. Recently, LG has entered the logistics robot market, which is expected to reach about KRW 11.5 trillion by 2025. Global logistics companies such as Amazon, UPS, FedEx, and Alibaba are already actively utilizing various logistics robots to automate their warehouses, and LG is preparing to commercialize its logistics robot, the ‘LG CLOi CarryBot,’ next month.

This progress is based on core technological capabilities such as ▲autonomous driving ▲sensors ▲artificial intelligence (AI) ▲cameras, accumulating data and know-how. LG has already signed a memorandum of understanding with CJ Logistics to jointly develop next-generation logistics robots (AMRs) and is working on supplying robots specialized in transporting large quantities of goods in manufacturing plants and logistics warehouses.

Hyundai Motor Group is accelerating the development of mobile autonomous robots that can move more stably over irregular surfaces and obstacles by leveraging its strengths in ‘mobility’ technology. Hyundai Motor Group announced plans to invest KRW 8.9 trillion over five years until 2025 in new technology and business sectors such as robotics, advanced air mobility (AAM), connectivity, autonomous driving, mobility services, and artificial intelligence (AI). Part of this investment will be allocated to next-generation robots such as wearable robots and service robots.

Visible R&D outcomes are already emerging. The independently developed chair-type wearable robot CEX and vest-type wearable robot VEX have undergone verification through pilot applications and have been used on automobile production lines at U.S. factories since October 2020. Currently, plans are being considered to expand these to medical use, assisting walking for patients with lower limb paralysis or supporting rehabilitation processes. AI-based service robots include ‘Dali,’ which provides customer service, and ‘H2D2,’ which handles delivery services within hotels.

Samsung Electronics initially conducted robot development within its research division, then formed a robot business task force (TF), and has now officially launched a robot business team. Samsung plans to invest KRW 450 trillion over the next five years in future new business areas such as robotics and artificial intelligence (AI), signaling a strategy to actively grow its robot business. Samsung plans to commercialize the wearable robot ‘GEMS’ within this year. Wearable robots have limitless applications depending on the technology integration direction, including medical devices that assist walking after being worn and fitness devices that enhance exercise effects. Ahead of GEMS commercialization, Samsung is pursuing plans to more than double the robot business team’s workforce from the current approximately 130 employees by the end of the year.