The clanking, hulking factory in a rural patch of northwest Germany that produces 20-tonne combine harvesters has lately been turning out machines with a technical edge.
Claas Group KGaA mbH, a 104-year-old, family-owned manufacturer of harvesters, threshers and tractors, is hunting for revenue by outfitting machines with sensors, cameras and software to help its products stand out amid slumping demand.
Low commodity prices have hurt farm equipment demand globally and Claas does not expect sales to increase from the US$4 billion made last year.
Since combines only see action six weeks per year, Claas is trying to sell software as well as machinery: for the past year a package of GPS networking, grain-load sensors and smartphone software to choreograph the lumbering dance of combines and 12m wagons that haul away grain.
Based on where the threshers are in the field and how full the loading wagons are, drivers can pinpoint where they are needed next with a glance at a screen, saving time and fuel.
“They’re bigger machines and there’s more horsepower under the hood,” managing director Carsten Hoff said. “The machines need to be smarter.”
An old firm turning to technology to drag it out of a slump is hardly a new story.
However, for Germany, it is a vital one.
Consultancy Roland Berger predicts the value of Germany’s industrial sector could decline by 220 billion euros (US$247 billion) by 2025 if it fails to update its computer and communications technologies, and lets new competitors get access to its customers.
German Chancellor Angela Merkel is urging the nation’s heavy industry to modernize — a policy dubbed Industry 4.0, for “the fourth industrial revolution” — wherein the likes of BMW AG, Robert Bosch GmbH, Daimler AG, SAP SE and Siemens AG are investing billions of euros to defend the country’s world-leading automakers and machine builders from US and Asian competition.
That is not even counting the thousands of mid-sized Mittelstand companies hoping to get on board and several hundred million euros invested by the government.
However, by some metrics, Germany might be a touch paranoid about its need to modernize.
A Boston Consulting Group study from December last year of more than 750 industrial producers in cars, mechanical engineering, plant construction and process industries found 47 percent of German companies have put elements of “smart” factories in place, versus just 29 percent of US manufacturers.
While consultancies are pushing the Industry 4.0 concept hard to market their services, getting companies below the blue-chip tier to put cloud computing, collaborative robots or augmented reality in their budgets will be a slog.
“The actual industrial base will take years to adopt this technology, longer than expected, because it’s extremely risky and they’re conservative,” Kepler Cheuvreux SA analyst William Mackie said.
Bosch is targeting savings of 1 billion euros by 2020 and a further 1 billion euros in fresh revenue through new technologies.
Its Feuerbach plant near Stuttgart started as a headlamp producer in 1914, switched to diesel injection systems in the late 1920s and survived World War II.
Today, product manager Wolfgang Pomrehn shows the company’s APAS assistant robot, designed for collaboration with humans.
One of the robotic arms, clad in soft black plastic, can be wheeled to a workstation or mounted on a bench to work in close quarters with a person, speeding up when it is left alone, slowing by five times when a worker is a half meter away, stopping when someone ventures too close.
Pomrehn’s group is working on new features for APAS that could help it read workers’ intent even if they miss a step and he envisions the robots being deployed alongside refugees who are starting to enter Germany’s factory force.
“There will be a structural change — jobs will disappear and new jobs will come,” said Henning Kagermann, president of the National Academy of Science and Engineering.
The Center for European Economic Research in Mannheim, Germany, estimates 12 percent of German and Austrian workers risk having their jobs 70 percent automated — the highest among 21 countries it studied.
However, Germany’s drive to modernize has created jobs for its robots.
Festo KG, a US$3 billion maker of industrial valves for auto and electronics manufacturing, boasts collaborative robots and has two Bosch APAS robots in a testing area at its Scharnhausen “learning factory” near Stuttgart in southern Germany.
The idea is to roll them among stations this summer at high demand times or on weekends to lay valves on a storage board, Festo research engineer Michael Voss said.
The company is facing competition from Airtac International Group (亞德客) in Taiwan, SMC in Japan and Parker PGI in the US, and invests 8 percent of sales in research and development, high for an industrial producer.
NO VIRUS BLUES: A SEMI Taiwan official said that the virus does not slow down the global semiconductor industry’s investment in manufacturing equipment The production value of the nation’s semiconductor industry is expected to grow 16.7 percent this year from last year, outpacing the global industry’s 3.3 percent growth, industry association SEMI said yesterday. That would help Taiwan safeguard its second spot in the global semiconductor market with a production value of more than NT$3 trillion (US$102.73 billion), SEMI Taiwan president Terry Tsao (曹世綸) told a media briefing in Taipei for the Semicon Taiwan trade show beginning today. The global semiconductor industry’s production value is expected to increase to US$426 billion this year, SEMI said. In terms of semiconductor equipment investment, equipment billings from Taiwanese firms
Intel Corp has received licenses from US authorities to continue supplying certain products to Huawei Technologies Co (華為), a company spokesman said yesterday. Washington has been pushing governments around to world to squeeze out Huawei, saying that the telecom giant would hand data to Beijing for espionage. From Monday last week, new curbs have barred US companies from supplying or servicing Huawei. This week, the state-backed China Securities Journal reported that Intel had received permission to supply Huawei. China’s Semiconductor Manufacturing International Corp (SMIC, 中芯國際), which uses US-origin equipment to make chips for Huawei and other companies, last week confirmed that it had sought
INVEST IN TAIWAN: A metal components casting firm and the world’s largest maker of aluminum bicycle rims also obtained approvals to join the program Solar Applied Materials Technology Co (SOLAR, 光洋應用材料), a part of Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) “green supply chain,” has pledged to invest NT$1 billion (US$34.1 million) to build a new plant at the Tainan Technology Industrial Park (台南科技工業區), the Ministry of Economic Affairs said yesterday. SOLAR has been collaborating with TSMC to extract precious metals from waste and reuse them as “sputtering target” material in high-end semiconductor manufacturing, a TSMC press release issued in May said. Established in 1978, SOLAR also offers key materials and integrated services to customers in the optoelectronics, information and communications technology, petrochemicals and consumer electronics industries,
‘SWARM TECH’: Joint venture FARobot is to develop autonomous mobile robots that would first be deployed in Hon Hai’s factories to optimize production efficiency Hon Hai Precision Industry Co (鴻海精密) and Adlink Technology Inc (凌華科技) have formed a robotic venture that aims to use “swarm technology” to create robots that can communicate with one another on the factory floor to optimize production efficiency. Hon Hai is Apple Inc’s leading iPhone assembler and the world’s largest contract electronics maker, while Adlink supplies industrial computers and Internet of Things solutions. Through a subsidiary, Hyield Venture Capital Co (鴻揚創投), Hon Hai holds a 51 percent stake in autonomous mobile robot (AMR) developer FARobot (法博智能移動), while Adlink owns the remaining 49 percent. Together, the two companies put up NT$200