A chill is blowing through Doosan Robotics' Suwon, Gyeonggi Province, plant, the front-runner in Korea's collaborative robot market. With production lines that should be running nonstop standing still, the utilization rate as of the end of the third quarter was only 16.4%. Even with facilities capable of turning out 2,200 units a year, the robots made through September were just 271. Compared with the 69.6% utilization during the same period last year, that is down to a quarter. Doosan Robotics, which had dominated the market by building out its largest lineup since its 2015 founding, is suffering a harsh growth pang.
The industry says the collaborative robot market is stuck in a lull before full-scale growth. U.S. Universal Robots and Korea's Neuromeka, Doosan Robotics' representative rivals, are not disclosing plant utilization or production figures. But their third-quarter sales fell about 16% and 28%, respectively, from a year earlier. Teradyne, Universal Robots' parent, said on its third-quarter earnings call, "Investment in downstream industries remains subdued, so the robot arm market continues to be weak."
◇ Robot-arm business hits expansion limits
Outwardly, Doosan Robotics explains the drop in utilization as the result of a "worsening external environment." With high interest rates persisting, manufacturers closed their wallets, and investment sentiment shrank due to policy risks in North America, its largest market. As U.S. President Donald Trump erected trade barriers and tariff policies fluctuated, local customers delayed investment and moved to the sidelines. As a result, robot arm inventories piled up.
But the industry sees the root cause of this crisis in the business limitations of robot arms themselves. Until now, Doosan Robotics has focused solely on selling the main body (manipulator), which corresponds to the robot's "arm." The problem is that with only this robot arm, creating added value is limited.
On the manufacturing floor, demands mounted that "what's needed is not a lone robot arm, but a complete robot equipped with advanced vision artificial intelligence (AI) and software that can smoothly handle the entire process." Moreover, to deploy robots in existing factories, production lines must be stopped and facilities redesigned. For manufacturers who need to keep plants running, that means facing a situation where the tail wags the dog.
In the end, selling only standalone "robot arms" ran into a structural limit that makes it impossible to win large-volume orders. Choi Seung-hwan, an analyst at Shinhan Investment & Securities, noted, "Collaborative robots usually supply around 15 units per order, which is limiting for scaling the business." These constraints showed up directly in results. Doosan Robotics' cumulative operating loss for the third quarter reached 43 billion won, already exceeding last year's annual deficit of 41.2 billion won.
◇ Selling "intelligent robot solutions" instead of robot arms… "Rebound in results will take 2–3 years"
At a moment when a survival breakthrough is urgent, Doosan Robotics has pulled the card of transforming into an "integrated AI robot solutions" company. The ambition is not simply to sell robot arms, but to sell systems that can perfectly perform specific tasks such as welding or palletizing.
This is also why it acquired U.S. robot solutions systems integration (SI) company One XIA in September. One XIA specializes in designing and supplying automation systems in manufacturing, logistics and packaging. Through this acquisition, Doosan Robotics aims to absorb know-how from installation to operation. Ultimately, the goal is to provide customers with turnkey, customized automation systems that "take care of everything." Doosan Robotics is also actively seeking additional mergers and acquisitions (M&A).
The push for a makeover is also evident in leadership changes. In Feb., Doosan Robotics appointed Kim Min-pyo, a vice president from Toss, as its new chief executive officer (CEO). The prevailing view was that it was unusual for a heavyweight manufacturing company to install a strategist with a Fintech background at the top. In Sept., it also recruited Oh Chang-hun, former CTO of Toss Securities, as the overall head to lead AI and software development. The company has shown its intent to fully remake itself from a hardware outfit that makes robot arms into a flexible platform company spanning software and AI.
In fact, in the second half of this year, Doosan Robotics' R&D shifted from a hardware-only focus to emphasizing software. At Korea's largest robot research center, which opened three months ago in Seongnam, Gyeonggi Province, about 100 researchers are dedicated to securing AI robot control and software technologies. In line with this, the hardware is also evolving into intelligent robot solutions. Internally, the company is working on giving legs to robot arms fixed in place by combining an AI brain with an autonomous mobile robot (AMR).
The industry views Doosan Robotics' rebuilding as a move aimed two to three years out. A Doosan Robotics official said, "Right now we are focusing investment on development and talent acquisition, so it will take time before results become visible." Can Doosan Robotics move beyond arms to equip a brain and a full body? The experiment has only just begun.