Pressure on Kuka + ILO annual conference • China.Table

German robotics manufacturer runs behind expectations
UN body discusses forced labor in Xinjiang
Real estate sales slump
Semiconductor production stalls
Possible end to Shanghai lockdown announced
WTO deadlock thanks to China and the USA
Profile: Panchen Lama missing for 27 years

Dear reader,

When Chinese household appliance manufacturer Midea bought Kuka six years ago, there was a great uproar that the German robot manufacturer was willingly handing over German expertise and technology to China. Kuka exemplified the sell-out of Germany. Today, the Chinese parent company Midea plans to take the next big step in the Kuka affair. Frank Sieren takes this as an opportunity to take stock of whether the takeover has paid off for the Chinese owner so far.

A few weeks ago, China came up with a special surprise: Beijing suddenly ratified two international labor conventions and thus vowed to prevent any potential forced labor by all means. So it is rather fitting that the annual conference of the International Labor Organization will take place in Geneva in a few days. There, China will be faced with accusations that do not shed a good light on the People’s Republic. So Marcel Grzanna took a closer look at what measures the UN organization could take against China.

I would also like to draw your attention to today’s Profile: It is about a young Chinese man who vanished at the age of six – and has not been seen since. We are talking about Gedhun Choekyi Nyima, better known as the Panchen Lama, the spiritual deputy of the Tibetan faith. And this is precisely why the situation is so explosive.

Your
Michael Radunski

Feature

Management expects more from Kuka

Kuka is a prime example of the fear of German technology being sold off to China. In 2016, the Augsburg-based robot manufacturer was acquired by Chinese household appliance manufacturer Midea. At the annual general meeting this Tuesday, the company is to be finally sinicized. The Chinese bosses also intend to buy out the last remaining small German shareholders and then take Kuka off the stock market. They hope this will inject more peace into the company’s management. So far, the company’s performance has fallen short of expectations.

By
Frank Sieren

Kuka, Germany’s largest industrial robot manufacturer, has made a successful start to the new fiscal year. Between January and March, the Augsburg-based group’s revenue rose by 18.3 pe rcen t to €853.4 million. At just under €1.3 billion, Kuka also recorded an about 42 percent higher contract volume. The number of orders in China even doubled. Local sales increased by 61.2 percent. Germany and the USA remain the biggest markets for the company, with 28 and 27 percent respectively. However, China follows in third place with 17 percent.

From the Chinese management’s perspective, it is also high time that Kuka finally delivers what the name promised its new owners. Kuka’s revenue had been at a crawl for years: Its €3.3 billion in 2021 was only a slight improvement on its €2.9 billion in 2016. Midea’s Vice President Andy Gu had already applied pressure and was “definitely not satisfied” with Kuka’s performance. This is one of the reasons why the new CEO Peter Mohnen is now assisted by Chinese CFO Alexander Tan.

The start of the new year could at least provide the hoped-for momentum. Especially since projections are good. According to a report by auditing company KPMG, Kuka plans to increase sales in China by 30 percent annually until 2024. By 2027, sales in the People’s Republic are expected to climb from €589 million to €2.35 billion. That would be 40 percent of total revenues, which are then to be generated primarily with small robots and software tailored to the Chinese market.

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