This article first appeared in Forum, The Edge Malaysia Weekly on March 12, 2018 - March 18, 2018

Malaysia’s automotive industry is a key contributor to the local economy, accounting for RM40 billion or 4% of the country’s gross domestic product. To facilitate the industry’s transformation and integration with regional and global automotive networks, the government introduced the National Automotive Policy (NAP) in 2006. Under the Third Industrial Master Plan, 2006-2020, the NAP influences the strategic direction of the automotive sector, ensuring its continued importance and contribution to the economy.

The new policies and measures under the NAP Review are expected to contribute significantly to the overall growth of the industry and the country. This year, greater emphasis will be placed on attracting foreign direct investment and encouraging value-added manufacturing activities using the latest technology.

While the Malaysian automotive industry has traditionally comprised local manufacturers and brands such as Proton and Perodua, the country has global companies such as Toyota, Honda, Nissan, Mercedes-Benz, Volvo, BMW and Peugeot operating and expanding their businesses here. An upcoming Toyota plant in Klang, for example, is set to increase Toyota’s Malaysian production volume to almost 100,000 units annually.

At the same time, the Asean Free Trade Area initiative is expected to lower import and export taxes in the region, opening up a vast regional export market. AFTA is also poised to drive the demand for cost-effective regionally-manufactured vehicles, increasing competition among automotive hubs Malaysia, Indonesia and Thailand.

These changes are driving automotive manufacturers to increase their operational efficiency by improving productivity and cost-efficiency while maintaining international standards. The adoption of automation technologies, such as collaborative robots (cobots), will enable the industry to do so, while remaining competitive in a changing automotive landscape.

Cobots — robots designed to work side-by-side with people — offer a multitude of unique features and benefits. The market value for cobots in the global automotive industry was US$23.56 million in 2015, and is projected to reach US$469.82 million by 2021, a compound annual growth rate of 64.67% between 2015 and 2021. The global automotive industry has deployed cobots in a wide range of processes, including material handling, assembling, machine tending, painting and quality control.

Automotive manufacturers in Malaysia can leverage cobots to meet the demands of a changing industry. The Malaysian automotive industry is no stranger to robotic automation, with a robot density of 275 robots per 10,000 employees. The adoption of cobots’ advanced technology can further boost the sector’s production capability.

Cobots have been proven to increase efficiency and productivity. They are designed to perform tasks round-the-clock, enabling businesses to minimise any production downtime. Within the manufacturing sector, cobot adoption increases output per worker by as much as 30%. Adopting cobots does not require high financial investment as they can be easily integrated into existing factory or production processes and layouts. For these reasons cobot adoption is expected to rise an estimated 10% to 15% annually between 2017 and 2020.

For instance, Nissan Motor Co streamlined its large-scale production processes at its Yokohama plant through the deployment of cobots. The company redeployed Universal Robots’ UR10 cobots to assist with a range of different processes as required. Using cobots to automate manufacturing of its engines and parts for electric and hybrid cars, Nissan achieved consistently high-quality output while reducing production downtime and overhead costs. This also allowed its ageing workforce to enjoy a reduced workload and to be redeployed to less strenuous tasks.

Cobot adoption benefits both the business and the employees who work alongside them. The use of cobots helps employees reduce mistakes by ensuring consistent, dependable output while relieving them of the physical effort needed for certain tasks. This allows the workers to improve their performance and productivity to deliver consistent, high-quality results. Employees can also be redeployed from dangerous and repetitive tasks to take on more stimulating and higher-level responsibilities, allowing them to upgrade their skillsets.

Bajaj Auto, the world’s third largest motorcycle manufacturer, automated its two-wheeler assembly lines with cobots to increase productivity and output consistency, produce multiple models efficiently and help its employees cope with tasks that required heavy lifting.

Manufacturers can use cobots to achieve different objectives depending on their unique challenges and constraints. It is thus most crucial for the company to identify what long-term business goals they want to achieve before embarking on the robotic automation journey. This year looks set to bring exciting opportunities for the Malaysian automation industry. Adopting automation and cobots may well determine which companies emerge stronger and which get left behind.

Shermine Gotfredsen is general manager at Universal Robots, Southeast Asia and Oceania

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