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Deus Ex Machina, Part III

Scientist working on a robotic arm
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This is part III of a collaborative, multipart series examining the global robotics landscape (see Parts I and II). Robotic development toward more complex tasks is far more symbiotic with human behavior than most likely appreciate. Human capital replacement was always the fear, but increasingly the relationship is inextricably intertwined. Part III focuses on human/robot collaboration (cobots) and augmentation.

Our joint survey with our partners at MassRobotics showed nearly universal Covid-related demand spikes at robotics firms, with users asking for new, collaborative applications. Private investment dollars continue to ramp, from <$1B to over $9B in the past six years.

COVID-19 Has Accelerated Growth in the Robotics Market

Covid-19 has necessitated changes broadly across supply chains. That concept is well understood. Perhaps, nowhere has the impact been so profound as on the next-generation robotics ecosystem.

We began to explore this group in Part II as we looked at warehouse/logistics mobile robots. In this report, we go one step further. We look at human/robot interactions and the evolution toward collaborative robotics and human augmentation.

In a post Covid world, collaborative robots will help enable socially distanced manufacturing at higher rates of efficiency. Iterations on this theme (like exoskeletons – also explored in detail here) will likely prolong careers of skilled workers, helping address one of the fundamental pain points impacting the logistics and manufacturing sectors today.

The Collaborative Robot Market

Collaborative robots (cobots) have been around since 2008 when Universal Robots (since acquired) sold its first robot to a Danish industrial customer. Currently, there is one clear market leader that commands share north of 60%. Despite the installed base scaling over 10x since 2014, cobot share as a % of total industrial robots remains low, at <5% as of 2019.

However, many factors are contributing to a likely inflection point in cobot adoption, including:

  1. a persistent shortage of skilled labor requires manufacturers to maximize production per employee and deploy technologies that can be easily programmed/changed without advanced robotics training
  2. advances in AI and a broadening cobot ecosystem have substantially increased the type and complexity of tasks that cobots can perform
  3. post-Covid social distancing realities lend themselves to human/cobot interaction and cellular manufacturing frameworks

Just last month, one robotics leader launched two new cobot families in a clear push toward this theme. There’s potential for the cobot market could grow 9x by 2026. This is based on the assumption that cobot density (cobots per 10k workers) reaches only 40% of global non-automotive levels.

A ramp of that magnitude also opens up meaningful opportunities across the ecosystem – from gripping technology, AI, vision, tooling, and solutions that allow traditional robots to operate collaboratively. We discuss all of these topics in our report.

The Exoskeleton Market

The exoskeleton market is more in its infancy. However, it is one of the cleanest distillations of the collaborative theme. Exoskeletons are essentially humans and robots as one.

World Robotics estimates the market to be approaching $300MM by 2023. That reflects ~40% average growth off their estimated 2020 base. However, our work with a pioneer in powered, full-body exoskeletons – suggests a market significantly larger. Based on our conversations, we see a potential $10B+ US opportunity by 2026.

Many designs have military roots, but have clear applicability in any task where repetitive lifting/moving of heavy objects is required – logistics, mining, maintenance, construction, etc. Advances in battery technology and declines in component costs have significantly reduced power consumption, extended run times, and brought production costs more in line with customer value-add, making commercialization viable.

The exoskeleton market is one of the most intriguing subsets of next-generation robotics over the next few years. We note that the Chinese non-auto robotics market began to scale post 2009, growing at a ~35% CAGR as density increased. That pattern seems like a reasonable guide. We then consider the potential for medical/rehab exoskeletons. World Robotics estimates this market is growing by nearly 50% a year to over $400MM in 2023.

Proprietary Survey Shows a Covid-Fueled Acceleration in Customer Interest & Shifts in Focus Toward Robotic Flexibility

We partnered with MassRobotics to conduct a survey of nearly 20 global robotics companies. Nearly 80% of participants are experiencing Covid-related accelerations in their business. Over half of those respondents categorizing that strength as 8 or higher on a 10-point scale.

When asked about interest in new capabilities not previously offered, ~60% answered collaborative robots and/or autonomous mobile robots. Nearly 80% of end-users surveyed intend to make robotic investments in 2 years or less. ~90% intend to increase the % of total spend toward robotics/automation by 10 percentage points or more over the next 2-3 years.

Notably, zero survey participants expect a decrease in % spend toward these applications. Implementation cost was a hurdle cited by ~80% of participants. With component costs compressing, conditions appear ripe for deployment.

Rise Of Robotics at the Department of Defense

DoD spending on robotics R&D and purchases continues to grow annually and adoption is increasing. The U.S. Army will have the biggest market impact on adoption of robotic systems. In the near term, it is focused on unmanned ground vehicles, ranging from tank-sized vehicles down to backpack-sized robots to perform different missions. Army spending has grown from $20M/yr to over $300M/yr over five years. Sizable procurement programs are underway with interest in vehicles, small airborne drones and exoskeletons.

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