Ulrich Spiesshofer

ABB Invests $150 Million on New Robotics Factory in Shanghai

Oct. 29, 2018
The Shanghai plant will be the company’s single largest robotics facility around the world.

ABB Ltd. will invest $150 million to build a robotics factory in Shanghai, as the Swiss manufacturer capitalizes on China’s rising consumption and aspiration to transform into a technology pioneer.

This new factory will set out to “shape the next generation of manufacturing, the next generation of capacity,” Chief Executive Officer Ulrich Spiesshofer said in an interview in Shanghai on Saturday.

Production is expected to begin by the end of 2020 and annual capacity will be around 100,000 robots, or one quarter of its global demand last year, Spiesshofer said. The Shanghai plant, located in the Kangqiao area, will be the company’s single largest robotics facility around the world, producing the full range of ABB’s products from small payload robots to large ones that can lift an entire car, according to Spiesshofer.

The Shanghai factory will also include a research and development center in artificial intelligence and machine learning. The R&D center and the factory “combined will position us strongly in a competitive environment,” said Spiesshofer, who is visiting China for the sixth time this year.

Zurich-based ABB’s share price has been on a losing streak, which continued after its third-quarter earnings missed estimates on slower demand growth from the Middle East and U.K. Operations in China, now ABB’s second-largest market with annual sales at $6 billion, outperformed the overall business with 13% growth in total orders.

"The investment today is a very important investment to make sure we continue this great growth story we’ve had," Spiesshofer said, adding that he felt the overall business climate in China has improved over the last few years.

ABB also signed a strategic cooperation agreement with the Shanghai government today to support the city’s industry, energy, transport and infrastructure, according to a statement.

By Bloomberg News

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