Ten years of changes in the industrial robot reducer industry

"In 2013, the domestic reducer industry was basically monopolized by two Japanese companies (Nabtesco and Harmonic)."

An industry insider who has been working in the reducer field for a long time recalled:

"At that time, there were only a few companies that could carry out development. Without considering the cost, these companies would give priority to mature manufacturers such as Nabtesco and Hamernaco as suppliers."

"Plus, the domestic ones were originally from the control background, and they had little understanding of it, and they basically used Nabtesco and Hammernaco."

As the most difficult breakthrough in the upstream of the industrial chain and also the most critical precision reducer for cost control of the robot body, it has attracted many domestic manufacturers to compete and launch a battle for localization since 2013-2023.

Data from Gaogong Robot Industry Research Institute (GGII) shows that the compound growth rate of sales volume of China's robot reducer market will exceed 22% from 2013 to 2023.

The steps are small, but steady and firm enough.

Ten years of industry change

2013: Lack of trust

Let’s go back to 2013. China’s robot industry had just started, and it was far behind the “Big Four” in terms of technology and products.

At that time, the sales volume of industrial robots in the Chinese market was only 36,800 units , and the number of domestic robot companies with shipments could be counted on two hands.

For foreign-funded reducers, the Chinese industrial robot market was small and "unpromising", so they were more inclined to sell to the "Four Major Families" at the time.

Industry insiders admit that even if foreign-funded reducer products are sold to Chinese robot companies, the price is "ridiculously expensive" in comparison. At that time, reducer companies represented by Lai Fu were still in their infancy.

On one side, there was an unequal buying and selling relationship, and on the other side, there were foreign-funded reducer brands with quality assurance and domestic reducer brands that were not convincing enough. This made the Chinese robot companies, which realized that they were being "choked" at the time, feel mixed emotions.

2014: Active participation

In 2014, after the country issued clear policies to support the robot industry, the number of participants in the robot market is increasing rapidly at the rate of "two robot companies emerging every week".

Driven by the rapid development of the robot industry, key components that have long been known as the "stumbling block" to the localization of robots have also shown a good development trend. GGII data shows that in 2013 and 2014, China's industrial robot reducer market achieved sales of 172,400 units and 231,800 units respectively.

During this period, Shuanghuan Transmission, Zhongda Lide, and Nantong Zhenkang entered the RV reducer development stage; Green Harmonic was also established.

2015: Ambitions

In 2015, the robot industry entered a white-hot stage, and related companies in the upstream, midstream and downstream industrial chains developed rapidly, with a series of events such as expansion, mergers and acquisitions, and cross-border development. However, at this time, foreign reducers were not only expensive but also had a long delivery time, forcing many domestic industrial robot companies to either develop reducers themselves or cooperate with domestic reducers.

The once quiet robot reducer market has suddenly received unprecedented attention. Han's Laser and Julun entered the market first, and Nantong Zhenkang cooperated with Efort, Steptronic, Inovance, and Wasu Robotics to optimize and expand the production of RV reducers.

Shanghai Electromechanical and Nabtesco jointly established Nabtesco (China) Precision Machinery Co., Ltd. to produce precision reducers for robots. Julong Signed agreements with Lin Chujie and Wang Shaopei to jointly establish Ningguo Julong Axis Co., Ltd. and Anhui Julong Robot Reducer Co., Ltd.

Although there have been reducer manufacturers such as Qinchuan Machine Tool, Shuanghuan Transmission, Lai Fu, Tailong Group, Nantong Zhenkang, Hengfengtai, Green Harmonic, Wuhan Jinghua Reducer (now known as: Siweit Transmission), and Shenzhen Hefa Gear Machinery, there are only a handful of companies that can truly introduce mass production in 2015.

2016: Storms and Storms

Since 2016, the price of industrial robot reducers in China has shown a downward trend as market demand has increased. According to GGIl data, in 2013, the demand for reducers for industrial robots in China was 89,000 units, and the market price of reducers was about 10,300 yuan . By 2017, the market demand for reducers for industrial robots in China increased to 319,600 units, and the average market price was about 6,300 yuan .

At the same time, Nabtesco has cut its prices by more than 50%. It goes without saying that it is becoming increasingly difficult for domestic reducer companies to gain a share of the domestic market. Some companies, such as Chaifu Robotics, have begun to move from the reducer industry to the body field.

Tao Caijiang, general manager of Chaifu Robotics, said that before 2016, the actual shipment volume of domestic robots was still small, and many end users specified robot brands. This period was very difficult for core component companies. In 2016, Chaifu Robotics was very optimistic about the market for domestic robots and quickly entered the field of robot bodies from the reducer industry.

2017: The Golden Age

In 2017, reducer enterprises ushered in a golden age of "supply exceeding demand". China's industrial robot sales have achieved rapid growth, entering a production expansion boom, and the demand for reducers has risen rapidly. GGII data shows that in 2017, the demand for China's robot industry reached 319,600 units (sets), a year-on-year increase of 70.20%; the market demand scale was 1.76 billion yuan, a year-on-year increase of 45.22%.

However, foreign brands have always been cautious and slow to respond to the Chinese market. They failed to take corresponding measures to increase production capacity when there was strong demand in the Chinese robot market. This brought a rare opportunity to domestic reducer manufacturers. Qinchuan Machine Tool, Zhongda Lide, Lai Fu and others have developed a series of products and entered the mass production stage. Lai Fu Chairman Zhang Jie said at the time that Lai Fu Harmonic had actually shipped tens of thousands of units in the first half of 2017.

Reducer products began to be in short supply, and Haozhi Electromechanical, Hongyuan Harmonic, Weihe Tool & Die, and Green Harmonic all added equipment to increase production capacity.

2018: The Silver Age

In the first half of 2018, in order to avoid the shortage of reducers, the original equipment companies and reducer manufacturers "banded together" and signed a large order:

EFORT purchased 10,000 sets of reducers from Shuanghuan Transmission;

Turing Robotics purchased 10,000 harmonic reducers from Xinbao;

Zhongda Lide and Bronte signed a purchase and sales contract for no less than 30,000 RV reducers;

Peitian Robotics and Green Harmonic signed a full-year purchase agreement for nearly 10,000 harmonic reducers;

Julong Technology's subsidiary Julong Qifan sold 23 types of harmonic reducers to Guangzhou Qifan, totaling 10,400 units, with a total contract value of RMB 23.1213 million;

…

In the second half of 2018, the robotics industry suddenly turned "cold". Coupled with the increase of new manufacturers and the completion of capacity expansion, the supply and demand pattern of China's reducer market reversed, from "shortage of supply" to the silver age of "oversupply".

Since most reducer companies lack core competitiveness, Nabtesco's timely price reduction policy and expansion of production made them "unable to cope", and some RV reducer manufacturers stopped production one after another. According to incomplete statistics, the number of domestic RV reducer manufacturers has decreased from about 50 in 2014 to about 10 at the end of 2018.

2019: The Bronze Age

The cold "wind" continued to blow into 2019. Domestic industrial robot manufacturers entered a period of adjustment, and the reducer industry once again ushered in the bronze age of "survival".

The performance of listed companies can give us a glimpse of this. In 2019, the performance of most listed reducer companies showed an increase in revenue but not in profit. For example, in 2018, Qinchuan Machine Tool's operating income was 3.188 billion yuan, a year-on-year increase of 6.3%, and its net profit was -280 million yuan, a year-on-year decrease of 181.1%. In 2018, Shuanghuan Transmission's operating income was 3.151 billion yuan, a year-on-year increase of 19.4%, and its net profit was 195 million yuan, a year-on-year decrease of 19.8%.

2020: Planning for the future

The arrival of the COVID-19 pandemic in 2020 has been a year of opportunity for the reducer industry. Against the backdrop of the pandemic at the beginning of the year, the domestic industrial robot market maintained rapid growth throughout the year, giving reducer companies a chance to "catch their breath."

Some reducer companies have begun to plan for the future. For example, Zhuhai Pegasus Transmission has expanded the production project of precision robot reducers in a new plant, with an annual output of 100,000 precision robot reducers. Shuanghuan Transmission has established a subsidiary, Huandong Technology, which has made key breakthroughs in RV reducer products for medium and large load robots (50Kg-210Kg load). Siweit Transmission has developed the world's smallest RV reducer in 2020, and its K series RV reducer research and development has also been successfully mass-produced.