China Headlines: China's manufacturers embrace new industrial revolution

A handful of young laborers at a solar cell factory in Zhejiang Province could be considered the new faces of an industrial revolution.

But the faces that are not there, the workers who were replaced by robotic arms, are at the true core of a trend sweeping China's manufacturing sector.

While normally a labor intensive industry, the solar cell factory, is one of the first in the sector to automate production, leaving dull assembly line tasks to robotic arms.

"The robots can detect positions. Their sensors can match the precision of human eyes," said Ren Tianting, chairman of the robot manufacturing company, Confirmware Technology (Hangzhou) Co. Ltd.

"A machine can do the work of 20 workers. Therefore it greatly helps reduce labor costs," said Ren. "Nowadays many young workers are not willing to do factory work as they believe it is dull and unworthy of respect."

SMART MANUFACTURING

Due to severe labor shortages and ensuing rising labor costs, the labor-intensive solar panel industry has just begun to use robots to replace workers.

Currently, robots have only replaced 20 percent of the total workforce in the industry and therefore there are still three to five golden years for robot sales, Ren said.

"China used to have sufficient labor and there was a small demand for robots," said Li Yuewei, marketing director of ADTECH (Shenzhen) Technology Co.. "The labor shortage in the Pearl River delta, however, is driving robot and other smart equipment makers to see robust industry expansion."

Rongsheng Group, also in Hangzhou, has made a similar move. Now robots are responsible for 40 percent of their capacity at its textile subsidiary, helping reduce their labor needs by 500 workers.

This is just the start of a new operation model for China's factories, which are embracing smart manufacturing to reduce costs and improve profit margins and competitiveness.

Over the past few years, many Chinese manufacturers have struggled with meager profits due to weak market demand, rising labor costs and low-end products.

To help bolster the competitiveness of the country's manufacturing, which accounts for 20 percent of the world's capacity, the Chinese government released the "Made in China 2025" strategy on Tuesday.

The plan, dubbed as China's version of "Industry 4.0", is a ten-year guideline to help the country become a manufacturing power in the next decade.

"In the United States, over 70 percent of the innovation originates from the manufacturing sector. It is almost the same in China," said Li Beiguang, deputy director of the planning department of the Ministry of Industry and Information Technology.

"With the guideline, we hope it can stimulate innovation to help improve the country's manufacturing competitiveness."

Wang Jingdong, vice president of home appliance giant Gree, admitted that the biggest challenge to China's manufacturing sector is innovation.

"The industry lags behind in terms of innovation. The government should unveil tough measures to protect innovation and create a fair competitive environment," Wang said.

RESHAPING THE INTERNET

The booming internet revolution also presents an opportunity for the manufacturing industry to reshape the value chain.

Miao Wei, Minister of Industry and Information Technology, said China will promote smart manufacturing and also use the internet to reshape the manufacturing sector.

Yin Jing, head of Alibaba's home appliances division, said the big data from e-commerce platforms can help connect manufacturers and their potential customers.

With the data, the manufacturers can easily learn the consumers' likes and churn out more personalized products to cater to different tastes, Yin said, adding the C2B model could help shorten the supply chain management.

In the past, manufacturers did not know exact demands of customers and which would result in oversupply of goods. This is part of the reason Alibaba will soon unveil several tailor-made home appliances, he said.

Lou Jun, vice president of IDG China, said the C2B model is the industrial development trend and it will deeply transform China's manufacturing sector.

Although most consumers have yet to accept the tailor-made services like 3D-printing, the tailor services still have bright market prospects, Lou said.

Gree has made attempts to use the internet to transform its production and after-sale service.

Gree's vice president Wang said data from their central air conditioners could be sent to the company so they could offer energy-saving tips and maintenance plans.

Also with analysis of customer data, the designers can better understand their individualized demands and thus develop products that cater for their needs, Wang said. Endi