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Backed by government, hardware makers grow amid labor crunch
From autonomous floor cleaning to robotic arms in warehouses, Singapore-based robotics startups are expanding their production and research capacity to tap into Asian markets and beyond, targeting companies eager to address labor shortages.
Lionsbot, which makes cleaning robots, opened a new factory in the city-state's northern Kranji district in April with an investment of $12 million Singapore dollars ($8.8 million), expanding its production line to 4,000 units a year, around five times the capacity of its previous production site. The company touts the factory as the largest in Southeast Asia for cleaning robots, hoping to accelerate its global expansion.
The plant "will help us in expanding our global footprint," CEO Dylan Ng told reporters at the opening event last month. In addition to Asian markets like Singapore and Japan, the company sells in the U.S. and Europe, where it set up local subsidiaries last year. Ng added that the company hopes to sell up to 2,000 units this year, doubling its annual revenue from a year ago to at least $30 million.
Founded in 2018, Lionsbot builds autonomous cleaning robots for small offices and large commercial and industrial settings, such as airports, warehouses, museums and hospitals. The company has four models selling for between $25,000 and $90,000. One of its more compact models, the R3 Scrub, is 81 centimeters tall, 60 cm long, 45 cm wide and weighs 60 kilograms.
Using high-precision sensors and AI systems, the robots are programmed to clean tight spaces and require only remote supervision. Cleaners can use mobile apps to control a fleet of dozens of robots on multiple floors simultaneously and receive real-time updates on the robots' progress. Lionsbot designed the robots from scratch with the help of Mohan Rajesh Elara, a professor at Singapore University of Technology and Design.
Southeast Asia's startup clusters, including Singapore, have long been known for digital consumer services like e-commerce and ride-hailing apps. However, the city-state is now trying to foster more cutting-edge hardware companies in collaboration with local researchers and universities. The goal is to create a hub for the robotics industry that will also draw overseas players.
In March, the government announced plans to invest an additional SG$60 million in the national robotics program, which encourages industrywide adoption and helps companies find markets for their products. The program has invested more than SG$450 million since 2016 in over 40 projects.
Eureka Robotics is another local startup targeting the global market. In April, the company announced a joint project with Japanese tire maker Bridgestone's corporate venture arm to develop robotic arms for warehouses that can pick up various objects.
A spinoff from Singapore's Nanyang Technological University, Eureka develops AI-powered controllers to automate industrial tasks with high precision, such as picking up fragile objects like optical lenses or small electronic components.
The company's strength lies in its core software and AI technology that can connect various robotics arms -- even those made by different manufacturers -- using 3D cameras and sensors to perform specialized tasks.
"We provide the brain and the eyes for robotic arms," CEO Pham Quang Cuong told Nikkei Asia. "Our strategy is to collaborate with hardware manufacturers, and sell them as an integrated system to other companies."
In Asia, China is the leader in robotics hardware and it has the world's largest fleet of industrial robots. In 2022, the country accounted for 52% of the 550,000 new industrial robots installed globally, according to the International Federation of Robotics, with its manufacturers enjoying vast economies of scale, and therefore lower costs.
Hai Robotics, a Shenzhen-based startup specializing in warehouse robots, is among the Chinese companies seeking to expand in Southeast Asia, a booming e-commerce and logistics market. The company recently opened a new regional headquarters in Singapore, more than twice the size of its previous office.
Founded in 2016, its clients include Chinese automaker Geely, South Korea's LG Group, U.S. industrial manufacturer GE and Danish shipping line Maersk.
In Southeast Asia, Hai Robotics said it received about 20 to 30 new project orders last year from local and multinational companies seeking to automate parcel handling. At a recent event, Nathan Zeng, the company's head of regional markets, told Nikkei Asia the company is seeking to double the number of new projects this year.
Due to its higher operating costs, Singaporean robotics companies have a hard time competing with Chinese rivals on price. So local companies are targeting more developed markets like the U.S., Europe and Japan, where demand for automation is rising due to higher wages and staff shortages.
"In places like America, some of the customers are very concerned about data [breaches], so that helps us," Lionsbot's Ng said, adding that robots made in Singapore have an edge in reliability as more countries prioritize data protection and cybersecurity.
"China's supply chain and low cost are well established. It is very hard to compete with them by doing exactly the same," Eureka CEO Pham Quang Cuong told Nikkei Asia. "Our specific AI technology allows us to differentiate ourselves."
Industry watchers say overseas expansion is key for local startups like Lionsbot and Eureka. Kiran Mysore, a principal at the University of Tokyo Edge Capital Partners (UTEC), said Singapore serves as a "good testing ground" to refine and perfect their products, though market access remains "a significant challenge" for companies aiming to grow.
"Singaporean startups can achieve growth by collaborating with Japanese manufacturers, who already have a substantial presence in Southeast Asia," Mysore told Nikkei Asia, "and potentially expanding into Japan, one of the world's largest industrial robotics markets."