Calling Asia: James bets on South Korea

00:00:00: Hi, Robert hier.

00:00:01: Dieser Podcast wird euch präsentiert von der Hannover Messe.

00:00:04: Wir sagen vielen herzlichen Dank an die Kollegen in Hannover und jetzt geht's los.

00:00:09: Robotik in der Industrie, der Podcast mit Helmut Schmidt und Robert Weber.

00:00:17: Hello everybody and welcome to a new episode of our Robotics Podcast.

00:00:25: Mein Name ist Robert Weber

00:00:26: and it's a pleasure to talk to Helmut Schmidt in Munich. Helmut, welcome.

00:00:31: Hello.

00:00:32: Oh, to your thing. Hello.

00:00:33: And today we are moving on to Singapore with our Robotics correspondent James.

00:00:39: James, welcome.

00:00:40: Thank you very much. Great to be here.

00:00:42: It's great to have you with us because you are a bit under of stress.

00:00:48: You've got a new job. Tell us about it.

00:00:50: I've got a new job working for a German ultra filtration ceramic membrane manufacturer.

00:00:56: Oh, and are you happy?

00:00:58: Yeah, I'm working with my old CEO from Universal Robots.

00:01:03: So yeah, I'm enjoying it. Great German tech and in a pretty vital industry.

00:01:10: So certainly enjoying the space.

00:01:13: But you're still interested in robotics?

00:01:14: Oh, very much.

00:01:15: And our water systems need pretty advanced automation to bring them to life.

00:01:21: So still got my hand in industrial automation quite significantly.

00:01:25: Okay. Okay.

00:01:26: Today we want to talk a bit about robotics in South Korea.

00:01:31: James, South Korea and robotics.

00:01:33: What's the first thing that comes to your mind?

00:01:35: I think it's the market size and the way that it's growing.

00:01:41: It's estimated at some six billion US dollars.

00:01:46: And it's got a kind of CAGAR or capital analyzed growth rate of north of 10% generally.

00:01:52: I think the highest installed base of industrial robots per worker in the world.

00:01:58: So it's really quite a powerhouse in terms of its adoption of robotics and automation technology.

00:02:06: And you now see that also being driven by the government heavily subsidizing robotics in terms of adoption

00:02:16: and also heavily subsidizing R&D in the robotics space.

00:02:21: And they spend a lot of money, right?

00:02:23: A lot of money.

00:02:24: They're estimating about 450 million US dollars per annum in incentives.

00:02:30: Yeah, but I think not only money, Helmut, because they are also very technology friendly when it comes to legislation,

00:02:38: when it comes to new laws, there's this topic AGVs in the pedestrian zone.

00:02:44: So it's a totally different approach than to a European or to a US approach, right?

00:02:50: Absolutely.

00:02:51: As James mentioned on the one hand side, they put a huge amount of money.

00:02:58: So this is a little bit similar to China, government driven money.

00:03:03: But even more, as you just also mentioned, they are quite flexible within legislation.

00:03:10: And also believe, and this would be then a question also to change, they are more open, maybe similar to Japan,

00:03:18: Japanese open to interact and to accept robotics in the society.

00:03:26: James, my question is just said in Germany, it has the biggest or the highest installation rate in Europe.

00:03:37: It's about a little bit more than 400, 450 per 10,000 robots.

00:03:44: But Korea, it's more than a thousand.

00:03:47: It's almost three times as high and with this, the highest penetration per employee.

00:03:55: Why do you believe it's both Germany, but also Japan, number four in Korea,

00:04:03: our industrial countries well developed?

00:04:07: But why is it still three times higher?

00:04:10: What is the main driver?

00:04:11: Yeah, I think a good question.

00:04:12: I mean, I think, you know, what all three companies, all countries, all three countries,

00:04:16: Japan, Korea and Germany have is incredibly strong,

00:04:20: automotive base, that I think, you know, what you're saying materializing Korea is an even, you know,

00:04:27: can I say a strengthening of that automotive base and a very, very strong microelectronics base,

00:04:35: including semiconductor, which I think, you know, distinguishes it from Japan, you know,

00:04:40: Korean automotive and Korean semiconductor or microelectronics have been really well adopted globally,

00:04:48: probably, you know, more so with the exception of Toyota than Japan and generally more so than Japanese microelectronics.

00:04:56: Now, I'm not aware of Germany having a massive microelectronics industry such as semiconductors.

00:05:02: So I think that's a key differentiator for the Korean market is they have a well established and still growing

00:05:09: automotive and microelectronics segment.

00:05:12: In which sectors is robotics growing there?

00:05:14: So its automotive, semiconductors, which industries are benefiting?

00:05:20: Well, I think the base has always been automotive and I think you could also say semiconductor.

00:05:25: But what you also have in Korea is a very strong shipping industry, which has adopted robotics quite rapidly.

00:05:31: In shipping industry, okay.

00:05:33: In terms of welding in particular.

00:05:36: You're also saying like Japan, Korea has an aging population,

00:05:40: but they also have the standards of living in South Korea are increasing,

00:05:45: which is on the other side of the coin to aging population.

00:05:49: You have a, you know, upwardly mobile generation Z and what follows it,

00:05:56: who don't want to work in restaurants or in the service industry.

00:05:59: So what you're seeing in Korea is these new segments expand for humanoid robots to care for aging population.

00:06:07: And you have probably one of the fastest growing food, beverage and service robot segment anywhere in the world.

00:06:14: You know, serving coffee, throwing chicken, that sort of thing.

00:06:17: Yeah, but from my point of view, the time of adaption or transforming the whole industry

00:06:23: is much faster than in Japan using robotics and automation.

00:06:28: Yeah, and I think that's a good comment for kind of the last two years.

00:06:35: But, you know, in 2019, they still wanted to cage every collaborative robot.

00:06:40: So I think they kind of came late to adopting in terms of uncaged collaborative.

00:06:46: And once they've realized the potential to keep, I think they're manufacturing based low cost and relevant.

00:06:52: They've really accelerated the legislative adoption of collaborative robots and AGVs,

00:06:58: as you've spoken about in terms of the, you know, the regulatory changes for AGVs on public streets.

00:07:03: And are the Koreans focused on own robots?

00:07:08: Or do they also, as you mentioned, import a UR or a Fanook or a Yascava or something else?

00:07:18: Or do they have their DOSAN, Hyundai Robotics, etc., etc.

00:07:22: Look, I think in the industrial space, of course, they still do Fanook and ABB and KUKA.

00:07:30: But they really have developed their own, and of course they use universal robots as well.

00:07:35: But I think the rapid development of Hyundai Robotics, Samsung Robotics, some cool startups like Rainbow,

00:07:42: and the recent IPL of DOSAN Robotics, these homegrown robots coming up the curve really, really quickly.

00:07:49: To be, you know, I would say most Korean robots are 90% of what you are now mechanically.

00:07:56: And, you know, that would be worse case. And I think, you know, from a user interface, that's getting better and better.

00:08:00: And, you know, when you look at the certifications some of these robots have to deal with food.

00:08:05: So, Helmut, James mentioned Rainbow Robotics.

00:08:08: You met them at Hannover Messer.

00:08:11: So what is so special with Rainbow Robotics?

00:08:14: One part, what's special is that Rainbow Robotics introduced a whole robot family.

00:08:20: So, most new players start with a 3-Kilo, 7-Kilo, or 10-Kilo robots.

00:08:27: At least in Hannover, they introduced a whole robot family with different payloads and reach.

00:08:35: They also integrated already some AI technology and sensitivity.

00:08:42: And of course, to be honest, it looks like a UR copy as many Chinese as well.

00:08:48: But I was impressed in a very short time to get a whole robot family done.

00:08:52: And they're currently also searching for integrators in Europe, in Germany.

00:09:00: But they have not been known so far, to be honest.

00:09:04: But James, you mentioned Dozan, you mentioned Hyundai, you mentioned Samtung.

00:09:08: So is the whole industry focused on these big players?

00:09:13: So, this is very typical for Korea, that they have these big players and these big players are doing everything.

00:09:20: Robotics, shipping, cars, batteries, semiconductors, smartphones.

00:09:26: Is this a special thing about South Korea?

00:09:29: I think Dozan is probably the one that I see consolidating their technology within their other business units.

00:09:36: And then also wanting to, the greatest form of flattery for UR is to be copied.

00:09:40: And I think Dozan are rapidly becoming as good, if not better than UR in terms of payload and reach and usability.

00:09:48: And technology transfer in Asia is pretty common.

00:09:52: So whilst UR was the first guys out of the blocks, the others are catching up.

00:09:57: and then you see a form of nationalism taking over.

00:10:00: As you see, well, why can't we do this with a Korean robot?

00:10:03: Equally, you're seeing hyper customization

00:10:06: for the needs of the Korean market by rainbow, by Doosan,

00:10:10: with the robots meeting certifications for food safety

00:10:12: and human interaction.

00:10:14: So, Doosan's probably moved the fastest,

00:10:17: but I suspect that you'll see Huy and I

00:10:20: and Samsung similarly follow.

00:10:23: - What about the US market for South Korean robotics?

00:10:26: Is it a target market for them?

00:10:29: - Yeah, I think, you know, certainly for Doosan.

00:10:31: You know, post-OP IPO, they're not really focused

00:10:34: outside Korea or on Asia.

00:10:36: They're heavily focused on their North American

00:10:39: and European units with, you know,

00:10:41: they're placing senior Korean executives

00:10:45: with Western experience, serious Western operating

00:10:49: experience in Europe and the same in the United States.

00:10:53: When I was in contact with South Korean companies,

00:10:57: it's always a little bit difficult

00:11:00: to communicate with them.

00:11:02: There's no, nobody's responsible for something.

00:11:07: They are not sure we will give the interview.

00:11:09: It reminds me a bit of the early 2000s

00:11:13: when talking with Japanese companies.

00:11:15: Is there a, maybe they also need to professionalize

00:11:20: a bit communication, marketing, focusing services

00:11:25: on the markets or am I am wrong?

00:11:26: Maybe I got the wrong guys.

00:11:29: - No, I think that's not a bad assessment.

00:11:31: And my last consulting engagement,

00:11:34: I was dealing with some Doosan distributors

00:11:37: and when I asked them and the non-Korean

00:11:39: and anybody in APAC and they said that the way

00:11:42: that they got tech support was actually

00:11:44: through a WhatsApp community of other users

00:11:47: because it was not always easy to navigate

00:11:49: the headquarter organization.

00:11:51: And I think that's because to get to the person

00:11:53: who makes the decision is not easy.

00:11:55: So I agree with you.

00:11:56: I think there's a way that, in the same way

00:11:58: that Japanese organizations increasingly are learning

00:12:01: how to deal with Western markets in a Western way,

00:12:06: that the Koreans are similarly adopting the same approach.

00:12:09: And that's why when you look at who they placed in,

00:12:11: Doosan placed as their head of Europe.

00:12:13: He was educated at US schools.

00:12:16: He's done time working in the investment banking history

00:12:18: in the United States.

00:12:19: He's very Western.

00:12:20: - But James, you also just mentioned, of course,

00:12:23: the biggest player like Doosan, Rainbow, Hyundai,

00:12:27: but most of them are doing industrial robots or co-bots.

00:12:31: If you'll now look on the trend on humanoids,

00:12:35: just have been a Beijing conference,

00:12:37: many Chinese companies introduced humanoids,

00:12:41: some US companies as well.

00:12:44: How is the status on humanoids in a career?

00:12:48: - Look, I think the guys from what I can see,

00:12:50: there's a real focus on humanoid robotics with AI

00:12:53: for natural interaction,

00:12:56: focusing on customer service, education and elder care,

00:12:59: which I think we talked about from the Japan perspective.

00:13:03: So they're very focused in what they're doing with humanoids.

00:13:07: And so they should be because from what I'm seeing,

00:13:10: the expecting market growth is about 50%

00:13:13: of the major by 2027.

00:13:15: So they certainly are preparing themselves

00:13:17: to be big players in this humanoid space.

00:13:19: - But is the Hyundai the main driver

00:13:23: or do they have dedicated to humanoids startups

00:13:26: focusing only on humanoids?

00:13:29: - Yeah, they do have dedicated startups

00:13:31: just facing just focusing on humanoids.

00:13:34: In fact, Rainbow, the collaborative robot from Rainbow,

00:13:37: is only Rainbow is part of a bigger organization

00:13:40: called the Career Advanced Institute of Science

00:13:42: and Technology, which are known for their humanoid robots.

00:13:46: So Rainbow is really just one string to the bow

00:13:49: that that organization has.

00:13:50: The other part is solely focused on humanoid.

00:13:54: - Okay, that's interesting.

00:13:55: We were talking about investing a lot of money,

00:13:58: reducing regulations,

00:14:00: but what also what I read in the newspaper,

00:14:04: it's very impressive.

00:14:06: It's about the state with city.

00:14:08: It's like a robot technopolis

00:14:11: building a total new city with playgrounds

00:14:15: and I think should be finished 2027 self-learning city.

00:14:20: Do you know any insights about the state with city?

00:14:23: - Well, I only know probably what I've read as well, Helmut,

00:14:25: but what I have read aligns to try to make it,

00:14:29: if you like an Asian version of what Denmark's

00:14:32: tried to make, wouldn't say if you like,

00:14:35: but they're also parceling into this free trade zone

00:14:39: where Korea is uniquely positioned within Asia Pacific

00:14:43: and close to the Americas,

00:14:45: with a cost base that's favorable to Europe and the US.

00:14:48: So I think that the combination of industry clusters in Daegu,

00:14:53: as well as the fact that it will be an innovation hub

00:14:57: will only spur the Korean robotics space

00:15:01: onto bigger and greater things.

00:15:04: - When you think about South Korean robotics,

00:15:06: what worries you a bit, James?

00:15:07: - I think the technology's sound.

00:15:10: From a quality standpoint,

00:15:12: I think depending on where you sit or where you live,

00:15:15: you'd be hard pressed to determine

00:15:17: if a Japanese made robot, a German made robot,

00:15:21: or a Korean made robot,

00:15:24: which would be how you would order those,

00:15:26: but because I think the quality standard's very high

00:15:28: from all three countries.

00:15:29: What worries me is if the Koreans can't get on top

00:15:33: of this communication challenge, if that makes sense,

00:15:36: that's where I see universal robots has been extraordinary.

00:15:41: - Communication, you mean with the community

00:15:44: or with your customer, right?

00:15:46: - With the community and with the customer,

00:15:48: because I think that's where sometimes it's interesting

00:15:50: to know to see what has driven the innovation at UR.

00:15:53: Is it UR or has it been their partners?

00:15:56: Their ecosystem partners, their distribution partners

00:15:59: who found really cool ways to use the robot

00:16:03: that probably weren't contemplated

00:16:04: in product management initially.

00:16:06: And I think if that way of collaborating

00:16:09: due to language barrier,

00:16:11: due to organizational structures that are inefficient,

00:16:14: which we talked about it for Korea,

00:16:16: doesn't get solved, then opportunity will get walked past.

00:16:20: - What do you think is the most exciting development

00:16:22: in the moment in South Korea when it comes to robots?

00:16:26: - I think they're pulling it all together in Degu City.

00:16:29: And I really do think that the IPO for Doosan,

00:16:35: their broad platform of robots

00:16:37: and the way they want to aggressively take those robots

00:16:40: into Western Europe and North America,

00:16:42: I think they watch that space.

00:16:45: - Hamoud, last question.

00:16:46: - Maybe in addition, because this was what you were starting.

00:16:49: So we have been talking a lot, of course,

00:16:51: on industrial robots, but you mentioned at the beginning,

00:16:54: and this is almost not existing in Europe at all.

00:16:57: It's slowly growing.

00:16:59: It's about the service robotic marketing,

00:17:01: like cooking and servicing.

00:17:04: And is this in the future the fastest,

00:17:07: the biggest robotics market, essentially?

00:17:10: Or why is it so different in this kind of niches?

00:17:15: - Look, I think it's a market that's relatively new helmet.

00:17:20: It's a new application,

00:17:21: and only certain robots have the ability

00:17:23: to fulfill the regulatory requirements to service it.

00:17:26: And you've got a rapidly,

00:17:29: the living standards of Koreans are rapidly increasing.

00:17:32: And in Asia, it's not common for educated folks

00:17:37: to work in restaurants and the like,

00:17:40: which is maybe a different to Europe,

00:17:42: or where I come from,

00:17:44: where that's what you do when you're at university,

00:17:46: but not so much in Asia.

00:17:48: So I do see food in Asia growing,

00:17:51: as with, we talk about collaborative robots doing

00:17:55: what's dull, dusty and dirty.

00:17:57: Well, I think eventually maybe food service

00:18:00: and food catering may fall into that as well,

00:18:03: as we don't have people that want to do those roles.

00:18:06: So I think it will grow,

00:18:07: but it's growing off a small base.

00:18:09: You know, I really think where they're going with humanoid

00:18:11: is where we've got countries with aging populations,

00:18:14: which include China and Japan and Korea

00:18:17: and a lot of Western countries.

00:18:19: I think that space is something we should be watching.

00:18:22: - Okay, and when you should bet on a country,

00:18:25: is it South Korea or China or Japan when it comes to robotics?

00:18:29: - If I had to bet on a country outside, you know,

00:18:32: the Europeans, I'd be betting on South Korea.

00:18:35: - Okay, why?

00:18:36: - You know, because I think if I was to transpose

00:18:40: the experience of Samsung or Kia or Hyundai

00:18:45: in automobiles and electronics

00:18:47: to a robotics organization like DUSAN or Samsung or Hyundai,

00:18:52: in robotics, I think the Koreans have,

00:18:56: the Koreans have demonstrated their ability to compete

00:19:01: with the best and become the best.

00:19:03: - James, thank you very much for your insight

00:19:05: on the South Korean market.

00:19:07: What is still on your agenda for today?

00:19:09: You have to work for your German company?

00:19:10: - No, I'm about to go and pick my two little girls up

00:19:13: from the German school.

00:19:15: - Ah, perfectly.

00:19:16: Perfect.

00:19:17: Do they learn German?

00:19:18: - They do.

00:19:19: - They do.

00:19:20: - Yes.

00:19:20: - Okay, so we will record for the next episode in German.

00:19:23: - They really want, they really want daddy to learn German

00:19:26: and now daddy's working for a German company.

00:19:28: I have no excuse.

00:19:30: (laughs)

00:19:30: - Okay, James, so next time we talk about China in German.

00:19:34: - I look forward to it.

00:19:35: (laughs)

00:19:36: - Bye bye.

00:19:37: - Thank you gentlemen, thanks.

00:19:38: - Okay, it was a pleasure.

00:19:40: Cheers.

00:19:41: - Bye now.

00:19:41: (upbeat music)

00:19:45: Robotik in der Industrie.

00:19:47: Der Podcast mit Helmut Schmidt und Robert Weber.

00:19:50: (upbeat music)

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