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ROBO Global says smart factories with robots, automation will flourish in 2019

The ROBO Global Robotics & Automation Index captures the investment opportunity in robotics, automation and artificial intelligence

Industrial robots
Industrial robotics will again be a 'prime growth driver,' says ROBO Global in its 2019 worldwide outlook

ROBO Global released a worldwide outlook report for 2019 that highlighted that artificial intelligence-powered industrial robots and automation would help build smart factories. Robots will also be friends for warehouse workers helping them to fulfill online orders. 

ROBO Global created the ROBO Global Robotics & Automation Index, the world’s first benchmark index to track companies that focus on robotics, automation and artificial intelligence.

“Industrial robotics will regain its spot as a prime growth driver,” according to the report, adding that China is developing an army of robots to turbocharge its economy.

READ: ROBO Global says artificial intelligence, robotics will create ‘wave of new opportunities’ in 2019

Chinese President Xi Jinping has called for a robot revolution in manufacturing to boost productivity.   

“In 2017, China had fewer than 1 robot per 100 manufacturing workers, compared with 3+ in Japan and Germany, and 6+ in South Korea and Singapore. Fanuc LTD (OTCMKTS:FANUY), Yaskawa Electric Corp (OTCMKTS:YASKY) and ABB Ltd (NYSE:ABB) are well positioned to benefit,” according to the report.

Robots building robots

Swiss-Swedish robotics company ABB Ltd recently announced a $150 million investment in Shanghai, China to build the world’s most advanced, automated and flexible robotics factory a cutting-edge center where robots make robots.

ABB has been a member of the ROBO Global Robotics & Automation Index since its inception in 2013. The new Kangqiao manufacturing center, near ABB’s expansive China robotics campus, will combine the company’s connected digital technologies, collaborative robotics and innovative artificial intelligence research to create the most sophisticated and environmentally sustainable factory of the future.

Chinese robotic growth is forecast to exceed 20% annually through 2020.

Collaborative robotics

Cobots, or collaborative robots designed to work side-by-side with people with limited guidance, are expected to remain the “fastest growing segment of industrial robotics,” the report stated.

“2019 will be the year that robots start to perform order fulfillment for e-commerce to address the huge shortage of human workers,” said inventor Ken Goldberg, who is also a UC Berkeley professor and ROBO Global strategic advisor. “Robots grasping an increasingly diverse set of products will be made possible by advances in research, deep learning, and Cloud Robotics.”

Online fulfillment centers — where companies like Amazon.com Inc (NASDAQ:AMZN) pick, pack and ship consumer orders require two to three times as many workers as traditional warehouses. Therefore, Kiva's robots are automating the picking and packing at Amazon warehouses. The Kiva robots — 16 inches tall and almost 320 pounds —  move at 5 mph, hauling packages that weigh up to 698 pounds. Kiva Systems co-founder Raffaello D'Andrea who is on the Robo Global advisory board sold Kiva to Amazon.com  in 2012. 

BIG PICTURE: ROBO Global captures the high-octane growth of robotics and artificial intelligence

The report pointed out that said Teradyne Inc’s (NASDAQ:TER) Universal Robot, was “the leader in collaborative robots,” and on track to grow sales by 40% to 45% in 2018.

In October, long-limbed UR5e, made by Universal Robots and sporting a two-fingered gripper from Robotiq, rang the closing bell at the NYSE to honor the five-year anniversary of ROBO Global. It became the first cobot, or collaborative robot, to ring the NYSE closing bell.

“The explosion of the collaborative robotics market continues. The industrial robot market has decoupled from a pure automotive and electronics focus and is seeing huge growth in markets such as food and beverage, warehousing, and logistics,” said ROBO Global CIO and President William Studebaker.

Consumer technology

The report also said the focus has “clearly shifted from next-gen smartphone devices to sophisticated, AI-powered applications.”

“The biggest impact will be in mobile AI, which will increase the connection between users and their phones via AI-enabled apps, content, and third-party features,” said the report. “Products such as TVs, refrigerators, and small electronic devices will use machine learning and deep learning techniques to communicate with users and each other.”

“I’m very excited about our game-changing new products, our vision of the smart home and iRobot’s role in it and the pipeline of new products on the horizon,” said iRobot CEO Colin Angle.

The top holdings in the index include iRobot Corp, Oceaneering International, Brooks Automation Inc (NASDAQ:BRKS), Cognex Corp (NASDAQ:CGNX) and Intuitive Surgical Inc (NASDAQ:ISRG).

Portfolio Composition

The ROBO Global Index includes nearly 87 stocks across 12 subsectors in 14 countries. The index is built to minimize risk by limiting reliance on the largest-cap players, and it is carefully structured to capture the growth of rapidly developing robotics and automation companies around the globe.

To put it into perspective, the benchmark ROBO index is to the robotics, automation and artificial intelligence universe what the Morgan Stanley Capital International (MSCI) Index is to investors who want exposure to emerging markets.

The ROBO index is used as a performance benchmark for funds and market growth. Since it’s the first major index in the robotics, automation and AI space, the ROBO index has several low-cost ETFs tied to it at the hip.

ROBO Global provides its expertise to the ROBO Global Robotics and Automation Index ETF (NYSEARCA:ROBO) which was trading flat at $34.70 on Wednesday.

Contact Uttara Choudhury at [email protected]

Follow her on Twitter@UttaraProactive 

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Price: $35.67

Market: NYSE
Market Cap: $1.99 billion
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