Where did the 2023 industrial robot orders go? What to bet on in the second half of the year?

The world is unpredictable, and most companies said: "The start of 2023 was not as expected ."

Demand at the downstream application end has tightened, supply has exceeded demand, and the output growth rate has hit a new low. Robot companies have been suffering from the "dawn" for a long time.

Data released by the National Bureau of Statistics showed that my country's robot production in the first quarter totaled 103,691 sets, a year-on-year actual increase of 1.17% and a month-on-month decrease of 15.36%.

"The robot market is not very good this year. There were few orders in the first half of the year, and the performance growth was lower than expected."

Many industry insiders described the current state of the industry this way: "Companies that have hit the right track had an easier time in the first half of this year, winning orders frequently, but companies that entered the market later have clearly felt the 'chill' and can only wait and see if there are other opportunities to enter the market while holding on to their own little piece of land."

The cold is approaching

Gaogong Robot noted that three years have passed since the epidemic, but the pace of global economic recovery has not been as fast as people expected.

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

Since 2022, my country'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. my country's foreign trade situation is becoming increasingly severe. In addition, while maintaining China as the main supply chain, multinational companies in various countries are also conducting pilot projects in alternative locations, especially North American companies, nearly half of which are seeking to establish pilot projects outside of China. In the post-epidemic era, the transformation of the global supply chain to the "China+ model" may be accelerated.

On the other hand, the outbreak of the COVID-19 pandemic has severely impacted the global economy, and many countries have experienced severe economic declines. As an important node in the global supply chain, the Chinese economy has also been hit hard. Many companies have seen a reduction in orders, and production and operations have become more difficult. In addition, the national willingness to consume has declined, and consumption has been weak. The manufacturing industry, which has a large demand for robots, has been hit by the epidemic.

Therefore, compared with the past, most companies this year are facing difficulties such as high costs, few orders, unstable orders, and increased difficulty in obtaining orders.

Some industry insiders joked: "The company has reached a point of 'life or death'."

"After the epidemic was lifted, everyone was ambitious and motivated to expand the market, but they found that there were no buyers for their products. Most companies were facing overcapacity, so the industry fell into endless 'internal friction' again."

Industry insiders revealed that the price war is getting more and more intense, and companies are trying to snatch orders from customers even if the price is lower than the cost. Under such circumstances, companies have no profit at all.

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

Taking the 3C industry as an example, in Q1 2023, the 3C industry continued its downward trend, with the output of mobile handsets, color TVs, and microcomputer equipment all showing negative growth.

Some robot companies focusing on the 3C field have encountered order cancellations after the 3C market demand weakened and shipments declined. The orders that had originally been received have "flown away", and the robot companies that are actively preparing for stock are facing huge inventory pressure.

GGII stated that the pressure on the real economy has led to a shrinking of potential demand, which has directly led to the current problem of tightening demand and intensified internal circulation.

The market is getting narrower and narrower, and many industry insiders have expressed a cautious attitude towards the future market. Therefore, cutting costs in the first half of this year has become a guide for most robot companies to survive.

Where did the orders go?

However, some robot companies have been thriving in the first half of this year and have won orders frequently.

Gaogong Robot noticed that these companies all have one thing in common: they are on the right track.

Since the beginning of this year, the expansion of power + energy storage battery production has continued. According to statistics from Gaogong Lithium Battery, in the first quarter, 24 power and energy storage battery projects were started and signed, with a total investment of more than 205.5 trillion yuan and a planned annual production capacity of more than 570GWh. Among them, 13 projects were started and 11 projects were signed.

The photovoltaic sector has seen high growth in both order volume and shipment volume, and production expansion has accelerated. In the first quarter of this year, many companies including Longi Green Energy, TCL Zhonghuan, Tongwei Co., Ltd., JA Solar, JinkoSolar, and Trina Solar announced annual photovoltaic expansion projects. Among them, JA Solar and Trina Solar's overseas photovoltaic projects have been launched and are expected to be put into production in the middle and end of this year.

GGII analysis shows that the photovoltaic industry continued to be highly prosperous in the first quarter of 2023, with cumulative output increasing by 53.2% in the first quarter and overall demand remaining strong.

Benefiting from the recovery of the manufacturing industry and accelerated investment in lithium batteries, energy storage, photovoltaics and other fields, the upstream and downstream industries have become more dependent on automated production and manufacturing, industrial robots are in short supply, and orders have seen explosive growth.

Efort, Hitech Controls and other companies have publicly revealed that they have won orders for photovoltaics and energy storage respectively.

Kelda, Funeng Dongfang, Xinshida and many other companies have revealed that orders for lithium batteries, photovoltaics, energy storage and other products have become one of the main driving forces for demand growth. They will increase their efforts to develop customers and further seize the market share of lithium batteries, photovoltaics and energy storage equipment.

Is it too late to enter the market now?

It can be found that in the first half of this year, only a few downstream industries of industrial robots, such as new energy vehicles, photovoltaics and lithium batteries, and energy storage industries, maintained relatively high prosperity.

But it is worth noting that after two consecutive years of rapid development, the lithium battery industry slowed down its expansion in 2023. Constrained by downstream market demand and the wait-and-see sentiment in the market caused by the price drop of upstream materials, the pressure on power battery destocking has increased, the pace of production expansion has slowed down relatively, and the lithium battery industry has entered a new round of cyclical adjustments.

This fluctuation will be transmitted to upstream equipment and robot-related fields, which will have an impact on the overall orders and revenue of machinery companies.

"Although the adjustment of the lithium battery industry will bring short-term pain, photovoltaics and energy storage contain broad market opportunities. Most of the industrial robot companies on the market are now planning photovoltaics and energy storage."

But at the same time, industry insiders also expressed their concerns: "Enterprises that entered the market early have already begun to reap the dividends of the industry trend, while the remaining companies are still looking for opportunities to enter the market. The Matthew effect will become more pronounced, and the watershed between companies has arrived."

Does entering the market late mean there is no chance?

Obviously not. Gaogong Robot discovered during its visit that there is a tacit consensus in the industry: facing a market worth hundreds of billions of dollars, it is hard for anyone not to be tempted.

In a sense, when entering the photovoltaic and energy storage industries, robot companies are only concerned about three aspects: first, whether it is beneficial to the company's strategic development; second, whether the industry itself can make money; and third, whether the input-output ratio is cost-effective.

As emerging industries, photovoltaics and energy storage are not growing as fast as the 3C industry. The demand for automation has been early and the entry threshold is also high. After investing real money, whether they can get a share of the pie in the fierce market environment is a problem that every player needs to face.

In the view of industry insiders, in any large industry, intensified competition among homogeneous products is inevitable, and it will be difficult to enter at this time. However, as long as the industry is still developing upward, any time is a good time to enter the market.

"Compared to photovoltaics, the energy storage market has developed more slowly and is still in its early stages of wild growth. The energy storage industry chain has not yet been formed, and no giants have emerged. This means that companies that take the lead in deploying energy storage have inherent advantages."