The two biggest clients of ABB, the world’s leading electrical equipment manufacturer, are VinFast, a Vietnamese automobile manufacturer which uses 1,000 robots in its assembly line, and an electronics company which uses 3,000 robots in a component production line.

Market potential

ABB Vietnam’s CEO Brian Hull revealed that the output of the company in Vietnam has seen 2-digit growth rates annually. 

ABB projects revenue to exceed $200 million in 2018. Half of the products made in Vietnam are for export, while the remaining is for domestic consumption.

The company’s prosperity in Vietnam shows the great potential of the market as the government, when planning socio-economic development for the year, ‘is thinking more about the driving force for exports’. It strives for 7-8 percent growth rate in exports in 2019.
 
The government is focusing on developing initiatives and legal frameworks to accelerate the automation process. This is inevitable as Vietnam’s labor costs are no longer low, while technology prices have been decreasing.

Many factories in Vietnam are following the automation process. Vinamilk, a dairy producer, has spent trillions of dong on automation. Electricity of Vietnam (EVN) has begun considering digital solutions for transformer stations and power plants.

Challenges

According to Hull, there are two big challenges in Vietnam: the lack of qualified labor force and difficulties in persuading customers about the real value that robots can bring.

Meanwhile, enterprises’ investment in automation depends on many factors, including the state’s policies, Vietnam dong pricing, and capital access.

More and more automation brands have come to Vietnam to seek opportunities. Three  of the four best-known brands, ABB, Yaskawa and Kuka, have arrived.

Junji Tsuda from International Federation of Robotics (IFR) said that many manufacturers are wondering if they should allocate their production bases from China to other countries such as Vietnam or the US. Kuka has opened its first representative office in Hanoi.  It is is one of the major rivals of ABB.

Shermine Gotfredsen from UR said that UR’s products in Vietnam are used in electronics, footwear and wooden furniture manufacturing.

The Ministry of Industry and Trade (MOIT) said that Vietnam is turning into a global production base and the demand for robots is expected to reach 1 million by 2020. 

Meanwhile, HBS estimates that the number of robots in Vietnam in 2019 would rise to 414,000.

RELATED NEWS

Robotics, high-tech treatment improves medical care in VN

VinFast to use 1,200 remote-controlled robots