strategic focus on general industry
The kuka brand stands for innovative technology in robot-supported automation of industrial manufacturing processes. In the automotive sector, kuka has been the technology leader in its target markets for many years. Some time ago, we started transferring this knowledge very successfully to related markets outside the car industry (general industry). In view of the increasing economic difficulties, we will now accelerate this process. Robot-based automation is increasingly replacing manual or less flexible automated manufacturing processes in general industry. kuka’s integrated business model combines the core component of industrial robotics with application engineering and offers it from a single source. The concept is unique and has potential synergies. The aim of the new management team is to systematically improve shareholder value.
growth opportunities in the americas and asia
In Europe, kuka is not only the technology leader when it comes to robotics and plant engineering, but also has the largest market share. As a result, the industrial regions of the Americas and Asia present good growth opportunities, particularly in general industry. The launch pad for this regional expansion is the strong market position of kuka Systems in North America and Brazil, as well as in China and India. All of these regions represent the largest local markets. At the same time, the reputation of the kuka brand in the automobile industry serves as a “door opener” for general industry. This applies equally to Robotics and Systems.
The Robotics division’s primary target markets in the Americas and Asia are the plastics and food sectors, metals machining and processing and logistics. The Robotics division was particularly successful in 2008 in expanding its general industry business, reporting double-digit growth for orders received. They were 24.4 percent higher year-over-year.
reference installations for the aircraft and solar industries
Solar module cross connect station.
Systems is in the process of establishing itself as a strategic aircraft industry supplier. Among its customers are Airbus, Boeing and Embraer in Brazil, the world’s third-largest aircraft manufacturing market. The division is especially focusing on the coming introduction of the new carbon fiber composite materials (cfrp). It has already won an order that will serve as a reference installation by supplying a cooperating robot system to assemble cfrp parts for Boeing’s new “Dreamliner 787”. Systems also delivered several robot-based systems for manufacturing photovoltaic modules to the North American solar industry (Evergreen Solar) in 2008. These solar sector activities will be further expanded in the coming years, and wafer and cell assembly lines will be added to the systems portfolio. The Systems division is also the market leader for car body assembly lines and operates a body-in-white production line for the Jeep Wrangler in Toledo, Ohio. The pay-on-production contract is unique in North America and serves as a showroom for visiting specialists, including those from general industry.
taking advantage of the global shift in the automotive industry
The global automobile industry is facing a structural shift. As a result of the 2008 economic recession, sales of high horsepower and full-size vehicles have declined sharply in the developed industrial regions of North America and Europe for the first time. At the same time, governments are providing the necessary financial support to accelerate the market launch of fuel-efficient and environmentally friendly engines and vehicles, particularly the us administration. The current reluctance of major carmakers to invest in new vehicle models and manufacturing systems may therefore be alleviated in the not-too-distant future. Each new car model requires a revamp of the vehicle’s chassis. This is supported by the normal product lifecycle, whereby the ability to sell older models continuously declines.
In parallel, a migration of carmaking manufacturing facilities from the developed industrial nations of Europe and North America to emerging countries, particularly the bric countries (Brazil, Russia, India and China) is taking place. In these regions, mobility through motorized vehicles is in its infancy. As a result, growth in demand for vehicles and the investments of international carmakers in manufacturing facilities in these countries could be far stronger than that of the world market. Because of low wage costs, local manufacturers also benefit from this trend, which is further supported by increasing exports of low-cost vehicles to the developed industrial regions. However, Europe’s and North America’s high quality and safety standards make exporting vehicles from the bric countries to these regions unlikely to succeed without the use of robot-based manufacturing equipment.
global presence can mitigate market swings
kuka has had successful business relationships with all European and North American carmakers for many years. Furthermore, kuka has been a solid business partner with a strong market position in the bric nations (excluding India) for almost 20 years. Over the past two years, kuka was able to close this gap in India by landing large orders from tata and a number of other national manufacturers, as well as vw in Pune. Due to this broad-based global presence, kuka could compensate capital spending fluctuations and structural shifts in the automotive industries of the developed industrial regions of Europe and North America into the emerging countries.
integrated business model creates synergies
To secure the core automotive industry business and accelerate the expansion into general industry, particularly in the American and Asian growth markets, the Robotics and Systems divisions will intensify their collaboration under the umbrella of the integrated kuka business model.
Since January 1, 2009, the company has been led by kuka ag’s two-person Executive Board and two divisional heads, who are responsible for the business operations of kuka Roboter GmbH and kuka Systems GmbH. kuka ag’s Executive Board establishes the strategies for the domestic and foreign markets and is responsible for the overall operational management of the company, as well as Group issues. kuka Roboter GmbH and kuka Systems GmbH are the management companies of the Robotics and Systems divisions. Regional subsidiaries in 25 countries support the divisions worldwide. These branch offices are responsible for selling their products and services and doing the local assembly and field service work.
kuka’s integrated business model has three goals. From a market perspective, closer cooperation between the Robotics and Systems divisions’ key account managers should generate more synergies in selling to the automotive industry. In the research and development area, the number of projects that are jointly brought to market readiness at the Innovation Center is steadily increasing. Furthermore, the divisions will be relieved of common tasks such as accounting, payroll, information technology, marketing and legal issues. These will be bundled centrally at kuka ag’s Shared Service Centers in Augsburg. The goal of all these steps is to increase the synergies within the kuka Group through more intense cooperation, develop standardized processes, strengthen the divisions in view of the deteriorating economic climate and concentrate the core competencies to the benefit of both divisions.
kuka’s integrated business model
