logo
‘Every day, we think about how to upgrade': China's factories see rise in robot adoption

‘Every day, we think about how to upgrade': China's factories see rise in robot adoption

The Star18 hours ago
GUANGZHOU (The Straits Times/ANN): When Sun Huihai first began working at a factory in the southern manufacturing belt of Guangdong some 13 years ago, his colleagues were all humans.
Now, they are joined by more than 200 robots which can work around the clock, seven days a week, to help produce air-conditioners for home appliances giant Midea.
Rows of bright orange robot arms whir at all hours of the day, fishing freshly pressed plastic parts out of hot metal moulds and onto a long conveyor belt.
Driverless robots with blinking lights store these parts in a multi-storey warehouse, and later take them to be assembled into units that are sold in China and around the world.
The number of robots put to work on the factory floor increases every year, said Mr Sun, 37, who heads the plant's engineering department.
'Every day, we think about how to upgrade and make manufacturing here more intelligent,' he told The Straits Times.
Scenes like this have become more common across China, as the 'factory of the world' turns to robotics to sustain and turbocharge its manufacturing juggernaut.
Over the past decade, the number of industrial robots on China's factory floors has increased more than six times to over 1.7 million, as companies grappled with rising wages and a shortage of workers willing to staff production lines.
China now has the world's third-highest density of robots in its manufacturing industry, trailing South Korea and Singapore in first and second place respectively, according to the International Federation of Robotics' figures for 2023, the latest available.
Their deployment is poised to increase further as China continues its transition from low-value, labour-intensive production to advanced manufacturing – a national priority.
'At any given time, China cannot do without the manufacturing industry,' said Chinese President Xi Jinping in 2023. 'The state will strongly support the development of high-end manufacturing,' he added.
Policymakers in China, wary of the hollowing out of industries which can occur when countries get richer, have long pushed for greater automation to keep factories competitive.
A decade ago, the government rolled out 'Made in China 2025', a plan to upgrade manufacturing and become a production hub for high-tech sectors such as robots.
Rebates, subsidies and other incentives have been offered to encourage factories to automate.
A rise in domestic production of industrial robots has also reduced prices, making the machines more affordable.
Factories in China pumped out nearly 370,000 of such robots in the first half of 2025, up 35.6 per cent from the previous year, according to figures from the National Bureau of Statistics.
At the Midea factory in Nansha, Guangzhou, where Mr Sun works, there are 204 robotic arms and 82 automated guided vehicles. They are supplied by Kuka, a German industrial robot giant which the Chinese company bought over.
One section of the plant, where plastic parts for the air-conditioner are moulded and retrieved, is dubbed a 'dark (heideng)' area. It is so named because of the high degree of automation: In theory, it can run without humans or any lights on, but in practice, it is brightly lit here at the plant.
Not every part of the factory is as automated, a costly endeavour.
Humans are needed to staff assembly lines, maintain the machines, and check the quality of manufactured parts. The facility employs some 4,000 workers during peak season, Mr Sun says.
Elsewhere, other manufacturers of electrical items, electronics and cars – the main users of industrial robots in China – have also ramped up the use of technology on their factory floors.
'Dark factories' have become a buzzword to describe the most advanced of China's production facilities. Such operations have reportedly been adopted by companies ranging from home appliance giants Xiaomi and Gree to automakers Changan and Zeekr.
As robot adoption picks up pace, one question that arises is: What will happen to the more than 100 million workers whom China's manufacturing sector employs?
The automation drive has at times been dubbed 'replace humans with robots (jiqi huanren)'. In 2021, Gree's chairman said that the company's 'dark factory' had slashed the need for workers at the plant from 10,000 to 1,000.
In Mr Sun's telling, employment at Midea's air-conditioner factory has remained roughly unchanged from a decade ago. What has changed, he said, is productivity. The number of air-conditioners the factory produces has more than tripled from 2015, company figures show.
Academics Nicole Wu and Sun Zhongwei, who interviewed and surveyed factory workers in southern China just prior to the Covid-19 pandemic, found that these individuals were not too concerned about robots just yet.
'Contrary to the more pessimistic assessments of automation, most manufacturing workers in Guangdong – who are buffered by steady increases in demand and a chronic labour shortage – appear to be unfazed by technological change at present,' they wrote in a paper published this year.
As China's birth rate falls and the population grows more educated, it has become more difficult for factory bosses to fill jobs, said Professor Sun Zhongwei, who studies industrial relations and social security at the South China Normal University.
He is not worried that the automation drive will go so far as to undermine the manufacturing jobs often seen as a means of stabilising employment, because market forces are at play.
Automation is a rational process, and industrial robots are a sizeable investment, Prof Sun said. 'Companies will need to calculate whether the cost of the machinery justifies the wages saved.'
Still, he added, the biggest losers as manufacturing goes high-tech are lower educated, older migrant workers who lack the skills to remain relevant. Many will have to return to their rural homes to do odd jobs, while others might find employment as service staff.
Back at the Midea factory, Mr Wang Liangcai, 26, an engineer, believes that his job is safe from automation for now.
'Equipment still needs to be maintained, it can't do so itself,' he said. 'But if you think about the long run... we also don't know how things will be.' - The Straits Times/ANN
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Long Thanh airport must receive first flight by end-2025: Vietnam PM
Long Thanh airport must receive first flight by end-2025: Vietnam PM

The Star

time4 hours ago

  • The Star

Long Thanh airport must receive first flight by end-2025: Vietnam PM

DONG NAI, Vietnam: Prime Minister Phm Minh Chính on Saturday (Aug 2) reiterated that Long Thanh International Airport must be completed to receive its first flight on December 19, 2025 and begin commercial operations in early 2026. Inspecting the airport construction in the southern province of Dong Nai, the leader praised efforts to accelerate progress but warned that the remaining tasks are complex and time is running out. He, therefore, asked all stakeholders to revise the schedule and ensure clear assignment of tasks. 'It is a must to coordinate more tightly and efficiently, mobilise additional manpower and equipment and fully engage main contractors, subcontractors, as well as police and military forces to speed up work wherever possible,' he said. The PM also urged monitoring, alongside construction progress, to ensure quality, workplace safety, technical and aesthetic standards, environmental hygiene and worker well-being. Apart from the airport, connecting roads, telecom, power, and water infrastructure, landscaping and environmental works, and service zones, he also called for studies to develop an airport city, aviation industrial park, free trade zone, and logistics hub around the site. PM Chính emphasised the airport's vital role in driving socio-economic development, generating jobs, and improving livelihoods. He described the project as a new symbol of progress, not only for the South-East region but for the entire country. He requested preparations to ensure the effective management and operation of the airport, while directing relevant sides to prepare for the construction of Runway 3 and Phase 2 of the project. This marks his eighth on-site inspection of the Long Thanh International Airport project, a 5,000ha development with a total investment of VND336 trillion (US$12.84 billion), aimed at easing congestion at Ho Chí Minh City's overstretched Tan Son Nhat Airport. Regarding delays in several bidding packages due to material shortages, site clearance issues, overlapping construction and heavy workloads, PM Chính asked the investor to step up oversight, maximise manpower and equipment, and resolve bottlenecks to keep the overall project on schedule. - Vietnam News/ANN

Risks remain for exporters even with tariff cut
Risks remain for exporters even with tariff cut

New Straits Times

time4 hours ago

  • New Straits Times

Risks remain for exporters even with tariff cut

KUALA LUMPUR: Malaysia's successful negotiation to reduce the reciprocal tariff imposed by the United States (US) on its exports to 19 per cent from 25 per cent is seen as a strategic step forward, placing the country on equal footing with major Asean peers while preserving key domestic policy priorities. While the new tariff rate did not eliminate trade hurdles, it marked a meaningful improvement compared to the earlier 25 per cent proposal and underscored Malaysia's ability to defend its sovereign economic direction in the face of international pressure. Still, economists cautioned that the relief is temporary and layered with risk. With the US being Malaysia's largest export market, accounting for RM198.65 billion in 2024, economic strain, particularly on manufacturers and small and medium enterprises, might intensify if broader reforms stall. "The tariff may shave off growth, primarily through reduced exports. However, resilient domestic demand such as consumer spending, infrastructure projects and pre-emptive rate cuts by Bank Negara Malaysia (BNM) provide buffers," Centre for Market Education chief executive Alvin Desfiandi told Bernama in an interview. Alvin said BNM's pre-emptive recent rate cut, which was the first in five years, supported Malaysia's economic growth but risked currency depreciation if US rates stay high. He noted that further easing might be necessary if growth fell below 4.0 per cent, but any spike in inflation above 3.0 per cent could limit that flexibility. "Thus, BNM should maintain flexibility for further rate cuts if growth falters, but anchor inflation at 2.0-3.0 per cent," he added. Meanwhile, Alvin believed Malaysia is entering the period of recalibration from a position of relative strength. "Malaysia's economy is navigating tariffs from a position of strength, with BNM's gross domestic product (GDP) forecast for 2025 already pricing in moderate disruption. The focus now shifts to industrial upgrades and market diversification to sustain growth beyond 2025," he added. However, Alvin opined that short-term fallout is difficult to avoid as the 19 per cent tariff would directly impact Malaysia's competitiveness in the US market, especially in key sectors like electronics and semiconductors. "The 19 per cent tariff will raise costs for US buyers, potentially reducing export volumes. This may create a domino effect that will negatively affect investment sentiment and currency movements," he said. Alvin said that tariff exposure would be highest in the electronics and semiconductor sectors, squeezing already-tight profit margins for local manufacturers. He said that Malaysia's reliance on Chinese components further complicated its position under Washington's stricter rules of origin. "Tariffs will highly expose the electronics and semiconductors industry, squeezing margins for manufacturers," he said. The risk of tariff stacking, where goods containing Chinese components are penalised under multiple jurisdictions, adds to exporters' cost pressures, potentially eroding Malaysia's competitiveness even without direct involvement in transhipment. "Since Malaysia's National Semiconductor Strategy (NSS) aims to offset losses by moving into high-value chips and attracting US foreign direct investment (FDI), the government may provide emergency grants for small and medium enterprises (SMEs) to explore new markets," the economist added. Beyond immediate mitigation, Alvin urged Malaysia to convert tariff pressure into opportunity and highlighted the importance of adopting a "tech-for-market access" strategy, trading supply chain transparency for stable US tariffs on semiconductor inputs. The economist said that the need to build green industrial alliances with the US in electric vehicle battery and renewable energy sectors is equally important, with Malaysia serving as a strategic Asean gateway. Moreover, he said Malaysia should also aim to lead on digital rulemaking by co-developing Asean standards in financial technology (fintech) and digital trade with the US. "The country should trade supply chain transparency for stable US market access in semiconductors, form joint green industrial alliances in electric vehicles and renewables, and take the lead in digital rulemaking through US-Malaysia fintech partnerships," he said. Alvin noted that this approach may transform tariffs into a catalyst for high-value FDI diversification, with the October Asean Summit offering a critical platform to lock in sectoral bargains. By conceding tactically on processes such as certifications and monitoring while holding firm on policy sovereignty, he said Malaysia might retain negotiating credibility for future bilateral agreements. Alvin also cited Malaysia Aviation Group's US$19 billion (US$1 = RM4.27) Boeing aircraft procurement as a symbolic but limited tool for rebalancing trade ties with Washington. "The Boeing procurement offers moderate deficit relief and symbolic leverage in tariff talks but cannot single-handedly rebalance trade or guarantee future concessions," he added. Its real value, Alvin said, was in demonstrating diplomatic pragmatism, aligned industrial strategy, and readiness to engage the US without surrendering sovereignty. Meanwhile, economist Dr Geoffrey Williams welcomed the tariff reduction but warned that it still presented significant risks for Malaysia's trade-dependent economy. "A potential 10 per cent drop in exports to the US could cost RM20 billion annually. This underlines the urgency for structural reforms and export diversification," he added. Williams said Malaysia must avoid over-relying on short-term measures or blanket support policies. "Redirecting fiscal savings to indiscriminate bailouts would be politically and economically unwise," he said, adding that businesses should double down on automation, supply chain resilience, and long-term competitiveness. Williams added that the current outcome reinforced the need for Malaysia to fully implement its reform blueprints under the 13th Malaysia Plan (13MP). "It's a reminder that domestic competitiveness must be earned," he said, adding that further negotiations with Washington would be necessary to secure improved tariff terms over time. Alvin concurred that Malaysia's dual-track strategy, namely balancing critical interdependence with the US while engaging its Regional Comprehensive Economic Partnership (RCEP) and BRICS partners, would define its long-term trajectory. He added that the 19 per cent tariffs would consolidate ASEAN unity in the short term, with Malaysia's October summit testing whether economic diplomacy could extract US compromises such as semiconductor exemptions. "However, the longer-term trend is clear: ASEAN will reduce US dependence through RCEP integration and non-Western partnerships. If Trump offers no concessions in October, expect accelerated ASEAN+BRICS cooperation, a tacit admission that the US market is no longer worth sovereignty trade-offs," he said. Alvin pointed out that, ultimately, the shift to a 19 per cent tariff level marked the end of Malaysia's low-cost FDI model but opened a new window for high-value investment if reforms hold. "The tariff parity ends Malaysia's low-cost FDI model but accelerates its transition to high-value niches," he added. With approved investments reaching RM378.5 billion in 2024, both economists agreed that Malaysia has shown resilience and policy clarity. The challenge now is to lock in long-term investor confidence through the execution of New Industrial Master Plan 2030 (NIMP 2030), supply chain repositioning, and bloc-wide diplomacy. Since April, Malaysia has been negotiating with Washington to reduce the previous 24 per cent tariff rate. The Malaysia-US tariff negotiations officially began on May 6 and concluded on July 31, 2025, resulting in a recalibrated 19 per cent tariff rate that now positions Malaysia in alignment with key ASEAN peers such as Thailand and Indonesia. - Bernama

Malaysia's successful tariff negotiation seen as strategic step forward
Malaysia's successful tariff negotiation seen as strategic step forward

New Straits Times

time5 hours ago

  • New Straits Times

Malaysia's successful tariff negotiation seen as strategic step forward

KUALA LUMPUR: Malaysia's successful negotiation to reduce the reciprocal tariff imposed by the United States (US) on its exports to 19 per cent from 25 per cent is seen as a strategic step forward, placing the country on equal footing with major ASEAN peers while preserving key domestic policy priorities. While the new tariff rate did not eliminate trade hurdles, it marked a meaningful improvement compared to the earlier 25 per cent proposal and underscored Malaysia's ability to defend its sovereign economic direction in the face of international pressure. Still, economists cautioned that the relief is temporary and layered with risk. With the US being Malaysia's largest export market, accounting for RM198.65 billion in 2024, economic strain, particularly on manufacturers and small and medium enterprises, might intensify if broader reforms stall. "The tariff may shave off growth, primarily through reduced exports. However, resilient domestic demand such as consumer spending, infrastructure projects and pre-emptive rate cuts by Bank Negara Malaysia (BNM) provide buffers," Centre for Market Education chief executive Alvin Desfiandi told Bernama in an interview. Alvin said BNM's pre-emptive recent rate cut, which was the first in five years, supported Malaysia's economic growth but risked currency depreciation if US rates stay high. He noted that further easing might be necessary if growth fell below 4.0 per cent, but any spike in inflation above 3.0 per cent could limit that flexibility. "Thus, BNM should maintain flexibility for further rate cuts if growth falters, but anchor inflation at 2.0-3.0 per cent," he added. Meanwhile, Alvin believed Malaysia is entering the period of recalibration from a position of relative strength. "Malaysia's economy is navigating tariffs from a position of strength, with BNM's gross domestic product (GDP) forecast for 2025 already pricing in moderate disruption. The focus now shifts to industrial upgrades and market diversification to sustain growth beyond 2025," he added. However, Alvin opined that short-term fallout is difficult to avoid as the 19 per cent tariff would directly impact Malaysia's competitiveness in the US market, especially in key sectors like electronics and semiconductors. "The 19 per cent tariff will raise costs for US buyers, potentially reducing export volumes. This may create a domino effect that will negatively affect investment sentiment and currency movements," he said. Alvin said that tariff exposure would be highest in the electronics and semiconductor sectors, squeezing already-tight profit margins for local manufacturers. He said that Malaysia's reliance on Chinese components further complicated its position under Washington's stricter rules of origin. "Tariffs will highly expose the electronics and semiconductors industry, squeezing margins for manufacturers," he said. The risk of tariff stacking, where goods containing Chinese components are penalised under multiple jurisdictions, adds to exporters' cost pressures, potentially eroding Malaysia's competitiveness even without direct involvement in transhipment. "Since Malaysia's National Semiconductor Strategy (NSS) aims to offset losses by moving into high-value chips and attracting US foreign direct investment (FDI), the government may provide emergency grants for small and medium enterprises (SMEs) to explore new markets," the economist added. Beyond immediate mitigation, Alvin urged Malaysia to convert tariff pressure into opportunity and highlighted the importance of adopting a "tech-for-market access" strategy, trading supply chain transparency for stable US tariffs on semiconductor inputs. The economist said that the need to build green industrial alliances with the US in electric vehicle battery and renewable energy sectors is equally important, with Malaysia serving as a strategic ASEAN gateway. Moreover, he said Malaysia should also aim to lead on digital rulemaking by co-developing ASEAN standards in financial technology (fintech) and digital trade with the US. "The country should trade supply chain transparency for stable US market access in semiconductors, form joint green industrial alliances in electric vehicles and renewables, and take the lead in digital rulemaking through US-Malaysia fintech partnerships," he said. Alvin noted that this approach may transform tariffs into a catalyst for high-value FDI diversification, with the October ASEAN Summit offering a critical platform to lock in sectoral bargains. By conceding tactically on processes such as certifications and monitoring while holding firm on policy sovereignty, he said Malaysia might retain negotiating credibility for future bilateral agreements. Alvin also cited Malaysia Aviation Group's US$19 billion (US$1 = RM4.27) Boeing aircraft procurement as a symbolic but limited tool for rebalancing trade ties with Washington. "The Boeing procurement offers moderate deficit relief and symbolic leverage in tariff talks but cannot single-handedly rebalance trade or guarantee future concessions," he added. Its real value, Alvin said, was in demonstrating diplomatic pragmatism, aligned industrial strategy, and readiness to engage the US without surrendering sovereignty. Meanwhile, economist Dr Geoffrey Williams welcomed the tariff reduction but warned that it still presented significant risks for Malaysia's trade-dependent economy. "A potential 10 per cent drop in exports to the US could cost RM20 billion annually. This underlines the urgency for structural reforms and export diversification," he added. Williams said Malaysia must avoid over-relying on short-term measures or blanket support policies. "Redirecting fiscal savings to indiscriminate bailouts would be politically and economically unwise," he said, adding that businesses should double down on automation, supply chain resilience, and long-term competitiveness. Williams added that the current outcome reinforced the need for Malaysia to fully implement its reform blueprints under the 13th Malaysia Plan (13MP). "It's a reminder that domestic competitiveness must be earned," he said, adding that further negotiations with Washington would be necessary to secure improved tariff terms over time. Alvin concurred that Malaysia's dual-track strategy, namely balancing critical interdependence with the US while engaging its Regional Comprehensive Economic Partnership (RCEP) and BRICS partners, would define its long-term trajectory. He added that the 19 per cent tariffs would consolidate ASEAN unity in the short term, with Malaysia's October summit testing whether economic diplomacy could extract US compromises such as semiconductor exemptions. "However, the longer-term trend is clear: ASEAN will reduce US dependence through RCEP integration and non-Western partnerships. If Trump offers no concessions in October, expect accelerated ASEAN+BRICS cooperation, a tacit admission that the US market is no longer worth sovereignty trade-offs," he said. Alvin pointed out that, ultimately, the shift to a 19 per cent tariff level marked the end of Malaysia's low-cost FDI model but opened a new window for high-value investment if reforms hold. "The tariff parity ends Malaysia's low-cost FDI model but accelerates its transition to high-value niches," he added. With approved investments reaching RM378.5 billion in 2024, both economists agreed that Malaysia has shown resilience and policy clarity. The challenge now is to lock in long-term investor confidence through the execution of New Industrial Master Plan 2030 (NIMP 2030), supply chain repositioning, and bloc-wide diplomacy. Since April, Malaysia has been negotiating with Washington to reduce the previous 24 per cent tariff rate. The Malaysia-US tariff negotiations officially began on May 6 and concluded on July 31, 2025, resulting in a recalibrated 19 per cent tariff rate that now positions Malaysia in alignment with key ASEAN peers such as Thailand and Indonesia.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store