matthew kimpton smith - the role of automation in the future of manufacturing and the opportunities...
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Group MD, Cygnet GroupTRANSCRIPT
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Matthew Kimpton-SmithManaging DirectorCygnet Group Ltd
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The Role of Automation in the Future of Manufacturing and the
Opportunities it Will Bring
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What is Industrial Automation?
INDUSTRIAL AUTOMATION• The use of control systems and software to
independently operate, control and monitor a mechanised system.
INDUSTRIAL AUTOMATION• Increases manufacturing output while reducing
operating costs.
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How big is the Market?
Industrial Automation
£100bn GloballyFactory Automation
£45bn Globally
Process Automation
£55bn Globally
Source: Credit Suisse estimates
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Reasons to Invest in Automation• Increase in output• Increase in flexibility• Reduction of waste• Save space in high value
manufacturing areas
• Reducing operating costs
• Reduce capital costs• Improving product
quality• Complying with H&S
North America Manufacturing output & manufacturing employees
North America Operational stock of robots & manufacturing output per hr of labour
Source: IFR, Bureau of Labour Statistics Source: IFR, Bureau of Labour Statistics, United Nations Statistics
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Automation Examples
Robotics Auto Guided Vehicles
Automated Handling
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Role of Automation
• Increases manufacturing output
• Reduces operating costs
• Improves product quality
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The Role of Automation in the Future of Manufacturing & the Opportunities it will
Bring
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Market Outlook
• The market has grown by approximately 6% per annum since 2003, this is roughly 1.7 times global industrial production.
Automation Markets vs. Global IP
Factory & Process Automation Growth Rates
• Global capex outlook for key automation end-markets such as Automotive and Petrochemicals is stronger today compared to previous years.
Source: Credit Suisse Economic Research Source: Credit Suisse estimates
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Emerging Economies
‘Lewis Turning Point’• Rural labour has largely been utilised
• Demographic polices are shrinking the working age population
• Rising education levels are reducing the proportion of the population wanting to enter the manufacturing sector
• Wage inflation – pressure on manufacturing costs
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China - CurrentDwindling Supply of Manual Labour (China)
Hourly Manufacturing Labour Costs (China)
Population aged between 15-19 minus population aged between 50-54 and new college students.Source: CEIC, UN, Credit Suisse estimates
Source: Credit Suisse Global Strategy
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China - Future
• Government actively encouraging the rise of manufacturing technology
• Increasing levels of automation will help China manage wage inflation
• Companies migrating their manufacturing facilities westRobot Shipments to China
Source: IFR, Bureau of Labour Statistics, Credit Suisse Research
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Robotics• Robot density in most geographic regions remains low. This
augers well for rising penetration as a driver of automation investment.IP & Robot Shipment CAGR’s (2000-
2011)Robot Density by Region (2002 vs. 2011)
• Penetration of automation in emerging markets remains low
• Emerging markets account for 50% of global manufacturing output
• Largest future growth opportunity for investment exists in Non-Japan Asia, which currently accounts for 35% of the world’s manufacturing output, but only has robot density of 11
Source: IFR Source: Robotic Industries Association
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Opportunities
• China needs to invest in automation to maintain competitiveness
• Opportunities in emerging markets and Non-Japan Asia
• As overheads rise in the east manufacturing could migrate west
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Factory of the Future
Henry Ford’s assembly line 1913
• Improved design software will increase product development
• The same software will be used to program machining stations and more dexterous robotics
• New materials such as Carbon Fibre will result in new production processes
• 3D printing promises to demolish economies of scale
• Manufacturing in the future will become even less labour intensive
• Labour costs will become less importantAutomated assembly line 2014
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Cygnet Group orders around the worldIn the last 3 yearsNorth and South AmericaUSACanadaBrazilMexico
West EuropeFranceSpainGermanyPortugalItalyNorwayAustria
East EuropeTurkeyBelarusPolandRussiaHungary
Middle EastIndiaSaudi ArabiaDubai
Far EastChinaKoreaTaiwanVietnamThailandIndonesiaSingapore
OtherAustraliaNew ZealandSouth Africa
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Partners
FORMOSA PLASTICS CORPORATION
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Head OfficeSwan House
New Cheshire Business ParkWincham Lane
WinchamNorthwich
Cheshire. CW9 6GGUnited Kingdom
Tel: +44 1606 810550
Cygnet ChinaShanghai
China
Cygnet USAPO Box 17856
GreenvilleSC29606
USA Tel: +1 864 3151720
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