Where Have All The Robot Orders Gone?

The world is unpredictable, and most industrial robot companies say, "The start of 2023 did not meet expectations.”

The demand for downstream applications has tightened, and the supply of robot products has exceeded demand. The growth rate of production has reached a new low, and robot enterprises have been struggling for a long time.

According to data released by the National Bureau of Statistics, the total output of industrial robots in China in Q1 was 103691 sets, an actual increase of 1.17% year-on-year and a decrease of 15.36% month on month.

The robot market is not very good this year, there were no orders in the first half of the year, and the performance growth was not as expected.

Several industry insiders have described the current situation of the industry as follows: "Enterprises that have hit the right track have had a relatively good time in the first half of this year, frequently taking orders. However, enterprises that have entered the market later have clearly felt the 'chill', and can only see if there are any opportunities to enter while holding onto one acre of land.

Gaogong Robotics have noticed that three years have passed since the pandemic, but the pace of global economic recovery has not been as fast as people expected.

On the one hand, the sudden epidemic has had a profound impact on the global supply chain, and the global supply chain is being restructured.

Since 2022, China's total import and export trade has shown a downward trend, and manufacturing capacity is shifting from the mainland at a visible speed, mainly to India and Vietnam. China's foreign trade situation is becoming increasingly severe. In addition, while maintaining China as the main supply chain, multinational corporations from various countries are also conducting pilot projects in alternative locations, especially North American companies, where nearly half are seeking to establish non Chinese production pilot projects. In the post pandemic era, it may accelerate the transformation of the global supply chain towards the "China+model".

On the other hand, the outbreak of the COVID-19 epidemic has severely impacted the global economy, and the economy of many countries has declined seriously. As an important node in the global supply chain, the Chinese economy has also been greatly impacted. Many enterprises have reduced orders and increased the difficulty of production and operation. In addition, the decline in national consumption willingness and weak consumption have impacted the manufacturing industry, which has a high demand for robots.

Therefore, compared to the past, most enterprises this year are facing difficulties such as high costs, few orders, unstable orders, and increasing difficulty in obtaining orders.

Some industry insiders joked, "The company has reached the point of 'survival'.

After the release of the epidemic, everyone was ambitious and prepared to explore the market with great enthusiasm. However, they found that there were no buyers for the products, and most companies were facing overcapacity. As a result, the industry was once again trapped in endless 'internal friction'.

Industry insiders have revealed that the price war is becoming increasingly fierce, and even if it is lower than the cost price, they will come to snatch orders from customers. In such a situation, the enterprise has no profit to speak of.

Especially in the first half of this year, industries such as 3C, home appliances, and metal processing were affected by the decline in economic prosperity, resulting in a significant decline in demand. This fluctuation was transmitted to upstream equipment and robot related fields, resulting in a double decline in overall order and revenue growth.

Taking the 3C industry as an example, in Q1 2023, the 3C electronics industry continued its downward trend, with negative growth in the production of mobile communication handheld devices, color televisions, integrated circuits, and microcomputer equipment.

Some robot companies that focus on the 3C field have encountered order cutting after the weak demand in the 3C market and the decline in shipment volume. The orders that were originally received have "flown" away, and robot companies that are actively stocking up are facing huge inventory pressure.

GGII stated that the pressure on the real economy has led to a contraction in potential demand, directly leading to the current problem of demand tightening and exacerbating internal competition.

The market is becoming increasingly narrow, and many industry insiders have expressed a cautious attitude towards the future market. Therefore, reducing expenses in the first half of this year has become a guide for the survival of most robot ontology enterprises.

However, there are also some robot companies that have had a "fish in water" experience in the first half of this year, frequently winning orders.

Gaogong Robotics has noticed that these companies all have a common characteristic: stepping on the right track.

Since the beginning of this year, the trend of expanding production of power+energy storage batteries has continued. According to the statistical data of Gaogong Lithium Battery, 24 power and energy storage battery projects were started and signed in the first quarter, with a total investment of over 205.5 trillion yuan. The planned annual production capacity for construction exceeds 570GWh. Among them, there were 13 construction projects and 11 signed projects.

The order volume and shipment volume in the photovoltaic field have both grown rapidly, accelerating production expansion. In the first quarter of this year, multiple companies including Longji Green Energy, TCL Central, Tongwei Co., Ltd., Jingao Technology, Jingke Energy, and Trina Solar announced their annual photovoltaic expansion projects. The overseas photovoltaic projects of Jingao Technology and Trina Solar have been launched and are expected to be put into operation by the middle and end of this year.

According to GGII analysis, the photovoltaic industry continued its high momentum in Q1 2023, with a cumulative increase of 53.2% in production in the first quarter, and overall demand remained strong.

Benefiting from the recovery of the manufacturing industry and the acceleration of investment in lithium batteries, energy storage, photovoltaics and other fields, the upstream and downstream industries have increased their dependence on automated production and manufacturing. The supply of industrial robots is in short supply, and orders are experiencing explosive growth.

Enterprises such as Everett and Haide Control have publicly disclosed that they have respectively won orders for photovoltaic and energy storage.

Multiple companies such as Kaierda, Funeng Dongfang, and Xinshida have revealed that current orders for new energy such as lithium batteries, photovoltaics, and energy storage have become one of the main driving forces for demand growth. They will increase their customer expansion efforts and further seize market share in lithium batteries, photovoltaics, and energy storage equipment.

It can be observed that in the first half of this year, there were only a few downstream industries of industrial robots, such as new energy vehicles, photovoltaic and lithium-ion batteries, and energy storage industries, which maintained a relatively high reputation.

However, it is worth noting that after two consecutive years of rapid progress, the lithium battery industry has slowed down its expansion rate in 2023. Due to downstream market demand and the wait-and-see sentiment caused by the decline in upstream material prices, the pressure to destock power batteries has increased, and the pace of expansion has slowed down relatively. The lithium battery industry has entered a new round of cyclical adjustment.

This fluctuation is transmitted to upstream equipment and robot related fields, which will have an impact on the overall orders and revenue of machine enterprises.

Although the adjustment of the lithium battery industry may bring short-term pain, photovoltaic and energy storage contain vast market opportunities. Currently, most industrial robot companies in the market are deploying photovoltaic and energy storage.

But at the same time, industry insiders have also raised their concerns: "Companies that entered early have already begun to reap the dividends of the industry's competitive edge, and the remaining companies are still looking for opportunities to enter. The Matthew effect will intensify and the watershed between companies has arrived.

Obviously not, the visit of high-tech robots found that there is a relatively tacit consensus in the industry: in the face of a billion dollar market, it is difficult for anyone not to be tempted.

In a sense, when it comes to photovoltaic and energy storage, robotics companies simply focus on three aspects: whether it is beneficial for the company's strategic development, whether the industry itself can make money, and whether the input-output ratio is cost-effective.

As an emerging industry, photovoltaic and energy storage are not growing as fast as the 3C industry, with early demand for automation and high entry barriers. Whether or not they can get a share of the market in the fierce market environment after being hit with real gold or silver is a problem that every player needs to face.

In the eyes of industry insiders, the intensification of competition for homogeneous products is inevitable in any large industry, and it will be difficult to enter at this time. But as long as this industry is still developing upwards, any moment of entry is a good time.

Compared to photovoltaic, the development of the energy storage market is relatively slow, and it is still in the early stage of savage growth. Moreover, the energy storage industry chain has not yet formed, and there have not been any giants emerging. This means that the enterprises that are the first to layout energy storage have inherent advantages.

In this process, enterprises need to cultivate both internally and externally. Internally, it is necessary to cultivate "internal skills" and strengthen team cooperation. From supply chain to delivery, the more important test is the team management ability of the enterprise. At the same time, the enterprise also needs to have strong comprehensive capabilities, such as research and development strength, funding, and excellent product competitiveness. Externally, we need to forge ahead and possess the ability to know, while also considering the needs of end customers to reduce costs and increase efficiency.

Undoubtedly, under the new round of industrial transformation in the new energy industry, industrial robots, as a typical industry driven by downstream application markets, are strengthening the certainty of terminal demand.

GGII stated that top manufacturers will continue to benefit from the rapid development of the new energy industry and new energy vehicles, and the Matthew effect will intensify, leading to differentiation among top manufacturers; Orders from manufacturers at the waist and below have significantly shrunk, and we still need to wait for a comprehensive recovery in the general industrial and sinking markets.

For manufacturers with waist and below, where do new orders come from? It is the main theme for 2023.

At present, some robot manufacturers are quietly making efforts to become "difficult to crack" car OEMs while laying out new energy sources. In the past, foreign brands dominated the automotive OEMs, but in recent years, after qualitative breakthroughs in the performance and technology of domestic brands, domestic brands represented by Eston have gradually won project orders from automotive OEMs based on their own advantages.

In addition, industrial robots have passed the education stage of the market, and the technology is becoming more mature. More and more end customers are recognizing the cost reduction and efficiency increase value brought by robots, and the application fields of industrial robots are also becoming more and more widespread.

Many industry insiders believe that traditional industries related to people's livelihoods, such as packaging, food, clothing, agriculture, and other fields, are also good opportunities to cope with the uncertain risks brought by long-term cycles.