Robotics association calls for national robot factory - use of Ford Saarlouis?

A week ago, the German Robotics Association (DRV) called for a national robotics factory in light of the ever-increasing robotics boom as well as Germany's unique robotics startup scene. The boom is seen particularly in completely new applications and types of robots. Since the paper was published, the first painting robot has been reported here, which should quickly have high sales potential worldwide, and the world robotics association, the International Federation of Robotics, has reported a 50% increase in sales of typical SME robots, cobots, in 2021(link). As the author of the paper, I stand firmly behind it, hence its publication here. The implementation could help the startups and also the Saarland. (There is definitely no manufacturing capacity yet for the future need of robots. What about the air cabs that are supposed to come on the market successively from the middle of the decade on? From Germany, Velocopter and Lilium could be among them).

The Saarland is said to have offered Ford up to 1 billion euros in subsidies if production were to continue(link). The state government should take the time and energy to examine the idea.

Addendum (10/17-22): However, the author also considers robotic manufacturing to be the most complex transformation, but worth considering in the event that there are few or other options. Complex because there are no concrete commitments to be expected on a 1-2 year horizon. Today's sales are still too small for this.

The "1,000,000 robots by 2030 concept" met with great approval

The paper presented by our association a few weeks ago, "More than 1,000,000 robots by 2030 could significantly reduce the personnel shortage," received a great deal of attention. Particularly in our industry, the feedback was positive. The figure mentioned is considered to be absolutely feasible. We are taking this as an opportunity to consistently think further.

The core statement of the paper is that the personnel requirement of up to 5 million people by 2030 cannot be solved by immigration or would only lead to new problems (housing, shortage of teachers). Since robotics is constantly being developed further, it could close the personnel gap to a considerable extent by means of application-specific solutions. The prerequisite for this is the joint development of these applications. As a result, these applications - consisting largely of existing hardware and new software to be developed - could be exported worldwide.

Users for these applications would be the handicraft, the gastronomy, the care and many more. It is always important to note that a robot should not replace a human being and that the will of the human being should be taken into account. Today, for example, less than 40% of people want to be cared for by a robot. Enabling them to do so would already significantly reduce the need for caregivers and also help those who reject robots. The available staff would have more time for them. A tiling robot doesn't have to tile the farthest corner in a small room. It would be enough if it laid large areas. Human capacities would then already be freed up.

1,000,000 robots in Germany = 5,000,000 robots in Europe

It should be remembered that every country in Europe, as well as the USA or even Russia and China, has the same demographic problem. Outside of Germany, only Denmark has a significant robotics industry in Europe. The U.S. is also surprisingly weak in the area of robotic arms. Today, there is probably more robotics know-how in Germany than in the entire rest of the world. Germany is home to a great many innovative robotics startups. Not every one will "make it", but some certainly will (see listing below).

Since European robotics is strongly concentrated in Germany and the application-specific solutions are to be developed here, the question arises as to how the rest of Europe is to be "supplied". As mentioned, all countries have comparable problems. This quickly results in a demand for robot arms of all categories of rather 5 million units by 2030 for Europe alone.

Does Germany recognize the strategic value as a manufacturing location for robotics?

This raises the question of where the required robots should be manufactured. In Germany or - there are already strong robotics industries there - in China, Japan or South Korea? The spontaneous answer from a German perspective is probably: "Here, of course. Robotics has a future. We want to profit from it."

We absolutely agree with the answer, but we also see the major problems with implementation.

Startups should be able to focus on technology

Alongside Kuka, the German robotics of the future will be largely driven by startups. This is both an opportunity (many new ideas) and a risk (too little capital, unfamiliar complexity, etc.). Now, Germany can let any startup "work" on its own or support it where it makes sense. This is what China is doing.

The core competence of startups is technology, but not manufacturing. In manufacturing, concentrated support would be in the national interest. If all companies were given the same support here, there would be no significant distortion of competition. Nor would there be at the European level, since there are only a few other manufacturers of robotic arms in the rest of the EU (Denmark). Moreover, this is a growth market and entirely new types of robots will be added, e.g., humanoid robots. Finally, manufacturing should be open to any market player. This applies to companies in other EU countries as well as in Asia. (The Japanese robot manufacturer Yaskawa already has a plant in Slovenia).

National Robot Factory

Against this background, the German Robotics Association advocates a national robot factory that would be open to all manufacturers. This could be segmented into different manufacturer sections. Nevertheless, synergies could be leveraged. At the same time, the foreseeable shortage of personnel in setting up many decentralized production facilities could be eliminated if existing infrastructure were taken over. A national robot factory is also likely to find support among startups. David Reger, founder and chief executive of NEURA Robotics, "explicitly supports," in his words, the idea. He sees future sales primarily limited by manufacturing capacity. (The fact that production capacities limit sales has been seen before, e.g. inverters during the solar boom. Currently there are too few heat pumps, solar panels, etc.).

Here, the state could help, according to our point of view. No talks have yet been held with other German robot manufacturers. What is certain is that no domestic manufacturer has the capacity to meet future demand.

Ford Saarlouis to close in 2025 - future partial use as national robot factory?

In June, the Ford automotive group announced its intention to close its plant in Saarlouis in mid-2025. Around 4,600 employees and suppliers will be affected. In the past, the Ford Capri was produced there (photo above). In the summer, the plant lost out to the Valencia plant in an internal competition. The Saarland is known to be structurally weak. The planned closure would therefore be all the more serious for this federal state.

The German Robotics Association asks whether the current car plant could not be used as a national robotics factory in the future. Our association names the potential users below, but has not yet been in contact with the companies regarding use. It merely wants to initiate a discussion.

The United Robotics Group, in which the Ruhrkohle Foundation holds a majority stake, could serve as a model for the transformation of the automobile into robotics. It is now building on the site of the former Opel plant in Bochum(link).

Does it need such a large robotics factory in terms of volume?

Elon Musk said at the presentation of the Tesla robot "Optimus" that for Tesla robots could become more important than car production and already "soon millions of robots" can be produced(link). Now Musk is known for his visionary or even full-bodied announcements, but even if Tesla would only reach 20% of the volume he envisioned, a plant like Saarlouis could be (partially) utilized. Because on the one hand it is a smaller plant and then Tesla is only one (large) car manufacturer among many. However, a large part of the German robotics industry could manufacture in Saarlouis.

Incidentally, the world's largest manufacturer of industrial robots, Japan's FANUC, is massively expanding its manufacturing capacity for "cobots," a type of robot that is particularly suitable for SMEs(link).

What could an implementation look like?

The basic approach is similar to that of shopping centers or even business parks in large cities: A state-affiliated operator provides the real estate and performs other services. Here, it could take over Ford's employees and make them available to the individual companies. Since the demand for robots will only gradually increase, start-up losses could not be ruled out. In order to cover these as well as the previous vested rights of the current Ford employees, the operator would have to be covered by the state of Saarland or the federal government. In order to have start-up capital, he would have to receive from Ford the liquidation costs envisaged, including severance payments. Employees who prefer to leave the company should be given the opportunity to do so, including taking their severance pay with them.

Only more precise calculations and the further development of the market will show whether the idea is feasible and sustainable. There is definitely a risk for the state in the course of assuming liability. Alternatively, however, the entire region would have to accept enormous losses in prosperity for years to come.

By the way, the car plant in Saarlouis was built to support the transformation from coal to new industry. This can now be repeated.

German robotics startups in alphabetical order

• AEON Robotics GmbH: May enter the market in 2023 with robots that have hands and possibly two arms. The company is based in Braunschweig.
• Agile Robots AG: Headquartered in Munich with smaller production in Kaufbeuren, Bavaria and larger production in China. The company is the world's first robotics unicorn. (Valuation of over US$1 billion).
• Franka Emika GmbH: Based in Munich, the company serves research, industry as well as medicine. Manufacturing in Durach/ Kempten.
• Neura Robotics GmbH: In addition to cobots for companies, the company also has household robots and a humanoid robot in development. With almost $100 million, it is the second best-funded German robotics startup. Its AI models are manufactured at its headquarters in Metzingen/ Lkr. Reutlingen. The cheaper robots in China.
• RobCo GmbH: Startup with first modular robot and Frank Thelen, known from "Höhle der Löwen", as investor. Manufacturing in Bavaria.
• Festo and Beckhoff, which subsequently entered the market, do not yet have their own robot production facilities.
• Kuka and igus would also be responsive.
• United Robotics Group is currently setting up a manufacturing facility in Bochum.

Contact: Board of DRV or author of the paper(Guido Bruch).

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The author of this blog is significantly involved in the AI/robotics project Opdra. He advises SMEs around robotics - up to 50% funding for consulting is possible. Permanently looking for interesting solutions, he has seen hundreds of applications. For this reason, his customers also include large companies that have know-how but do not know the entire market. You can find more about him here.