Industrial area to help expand robotics business in the world's largest market

Midea Group and its German robotics and automation partner Kuka AG commenced construction of a joint smart manufacturing industrial park on Thursday in Foshan, Guangdong province.

Located in the Sino-German Intelligent Manufacturing International Cooperation Demonstration Zone in Shunde district, the park will feature four major areas - smart manufacturing, logistics, healthcare and homes.

According to Midea, a total investment of 10 billion yuan ($1.58 billion) will be put into the construction, and the park will cover an area of approximately 800,000 square meters.

The firm also plans to set up centers of manufacturing, research and development, and application demonstration in the park.

Fang Hongbo, chairman and CEO of Midea, said the launch of the smart manufacturing industrial park will be a key step to realizing the company's "smart" strategy, which focuses on human-machine connection and collaboration.

"The launch of the industrial park will help to expand Midea and Kuka's business of robotics and automation in the Chinese market," Fang said.

"China is the world's largest market for industrial robots - and this market continues to grow steadily," said Till Reuter, CEO of Kuka. "The smart manufacturing industrial park is another huge effort made by Midea and Kuka to tap the Chinese market."

According to the International Federation of Robotics, the number of robotic units in the global market will be about 210,000 units by 2020.

"China is the robotic market of the future - it offers huge potential for growth and we will be expanding our local capacities enormously in the near future," Reuter added.

According to data from the IFR, in 2016, the annual sales volume of robots in China reached the highest level ever recorded for a single country, surging 27 percent to 87,000 units year-on-year.

The federation estimates that sales of industrial robots in the Chinese market will increase by 15 to 20 percent from 2018 to 2020.

Earlier, sources from Midea said that the Guangdong-based company had worked with Kuka to set up three joint ventures with the vision of ultimately boosting fast and comprehensive growth in the automation business.

Midea, which owns a majority stake of Kuka, will own a 50 percent stake in the JVs.

"Here in the Chinese market, Kuka and Midea have the same vision to further shape 'smart manufacturing, smart home' in the near future. We are working on advanced robotics and automation - not only in industrial production, but also in other areas such as healthcare and, one day, in our daily lives at home," Reuter said.

According to Reuter, Kuka will produce and sell around 75,000 robots and AGVs (automated guided vehicles) by 2024, with a total capacity of 100,000 robotic units including existing capacity.