May 19, 2014 10:04 pm

Universal Robots are a big hit

The Czech writer Josef Capek coined the word “robot” in his 1921 science fiction play R. U. R, (above) which stands for Rosumovi Univerzální Roboti or Rossum’s Universal Robots.

Now, Danish company Universal Robots is on course to achieve a turnover of DKK1bn ($1.8m) by 2017 after having seen sales of its robot arms used in small manufacturing increase more than 40-fold in the past four years.

“I joined the company in September 2004 and I was employee No 4,” says Enrico Krog Iversen, chief executive of Universal, in which he is also a large shareholder.

“Today, we have about 100 employees, mostly in our headquarters, but we are also growing in the US and China and we are setting up in Singapore. We will probably add another 50 people this year. We should reach our 2017 sales objectives and have between 275 and 300 employees by then.”

Robotics appears to be gathering pace in terms of technological advances and sales, with the main centres of research centred on universities in Massachusetts, California and Japan. In the last year, the US tech giant Google has bought eight robotics companies, generating much anticipation of breakthroughs in the next few years.

Universal Robots grew out of a cluster of tech boffins at the Danish Technological Institute and the University of Southern Denmark in the city of Odense in 2005.

The three founders, Esben Østergaard, Kasper Støy and Kristian Kassow, wanted to create a light robot that was easy to install and programme after doing analysis of the special requirements of robots in the food industry.

Until then, robots used in manufacturing were heavy, unwieldy and unsuitable for smaller and more nimble tasks. Universal helped to revolutionise the market for robots used in small and medium-sized enterprises. Its robot arms cost about €22,000, plus the same again for set-up expenses, which many customers have recouped in less than a year.

The company received investment from Syddansk Innovation, one of the largest innovation incubators in Denmark, and from the Danish State Investment Fund. Its first UR5 robots, weighing 18kg were sold by distributors in Denmark and Germany in 2009. By last year, its 10kg robot, the UR10, was being sold across Europe, the US and Asia including through a Chinese subsidiary.

The company now has a global network of distributors with 200 sales partners in 50 countries.

“SMEs will still be our main focus because we can really make a big difference to them,” says Iversen. “But we also see that large companies like our technology because it allows them to robotise a number of applications using their traditional, industrial models. [Consumer product company] Procter & Gamble and [car company] Volkswagen have started using our products.”

Last year, the robotics industry achieved a record in robot sales to reach 168,000 units, according to the International Federation of Robotics. It says that between 2008 and 2012, industrial robot sales increased by 7 per cent a year to $8.7bn, with the business concentrated in Japan, South Korea, Germany, China and the US.

Car companies accounted for 52 per cent of robot installations in the US, with electronics manufacturing also making up a large share. In the SME sector, rivals to Universal Robots include Rethink Robotics, a Boston-based company.

A number of initiatives are under way in Europe to develop the robotics industry, including the Factory in a Day programme launched last year and in which Universal Robots is a partner.

The four-year project has a budget of €11m, of which €7.9m will be funded by the EU. The international consortium comprises 16 partners and is co-ordinated by Delft University of Technology in the Netherlands.

The plan is to encourage more SMEs to use advanced robot technology and so boost their productivity by developing a system that can be made operational in 24 hours, is leasable and is cheap.

“The more a company is allowed to automate, the more successful and productive it is, allowing it to employ more people”

- Enrico Krog Iversen, chief executive of Universal

Applications include checking and packaging fruit, polishing steel moulds or the refilling of a spray-painting machine. “With the technological and organisational innovations of the Factory-in-a-Day project, we hope to fundamentally change the ways in which robots are used in the manufacturing world,” says project co-ordinator Martijn Wisse, associate professor at Delft University of Technology.

Iversen says a company could also use the technology to replace a worker who was off sick. “Instead of calling in a person to replace the worker, robots that are now easy and fast to programme could be up and running within an hour or so,” he says.

He is also confident that trade unions will not resist the replacement of humans with robots. “Most unions around the world fully understand that robots create jobs,” he says.

“The more a company is allowed to automate, the more successful and productive it is, allowing it to employ more people. People themselves need to be upgraded so they can do something value-creating but overall the number of employees is higher.”

Academics are divided about the impact of robotics and computerisation and how far they might hollow out jobs markets around the world. In Denmark, where workers are among the most expensive in the world, robotics can offer productivity gains and help to retain manufacturing companies that might otherwise relocate somewhere cheaper.

In the meantime, the technology and robotics of the future are inspiring anxiety among ordinary people, according to a recent poll by the independent Pew Research Centre. It found that 30 per cent of Americans think these changes will lead to a future in which people are worse off than they are today.

About 65 per cent thought it would be a change for the worse if lifelike robots became the primary caregivers for the elderly and people in poor health. But Iversen says such use of robots are coming, probably in the next 20 years or so.

“We will see different kinds of service robots used at home, in elderly care and hospitals,” he says. “Instead of people pushing beds, a robot will do it.”

Copyright The Financial Times Limited 2014. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.

SHARE THIS QUOTE