Welcome to the IFR Press Conference 18 October 2018 Tokyo

Welcome to the IFR Press Conference 18 October 2018 Tokyo

Agenda Welcome Presentation of the speakers World Robotics 2018 Industrial Robots Review 2017 and forecast 2018-2021 Main markets customers - trends Robot density World Robotics 2018 Service Robots Professional Service Robots Personal/Domestic Service Robots Companies Questions Gudrun Litzenberger Page 2 18 Oct. 2018

Speakers on the panel Junji Tsuda IFR President Representative Director Chairman of the Board Yaskawa Japan Steven Wyatt IFR Vice President Group Vice President, and Head of Marketing & Sales Robotics, ABB Switzerland Gudrun Litzenberger General Secretary International Federation of Robotics Germany Gudrun Litzenberger Page 3 18 Oct. 2018

International Federation of Robotics Representing the global robotics industry Robotics turnover 2017: $48 billion More than 50 members: National robot associations R&D institutes Robot suppliers Integrators Sponsor of the annual International Symposium on Robotics (ISR) Co-sponsor of the IERA Award Primary resource for worldwide data on use of robotics IFR Statistical Department Gudrun Litzenberger Page 4 18 Oct. 2018

Records, records 2017: 381,300 units, +30% 2018: 421,000 units, +10% 2021: 630,000 units, +14% on average per year Junji Tsuda Page 5 18 Oct. 2018

Continued record sales since 2013 Estimated annual worldwide supply of industrial robots 2009-2017 and 2018*-2021* '000 of units 700 600 500 400 300 200 100 0 *forecast +14% on average per year 630 553 +10% 484 +30% 421 381 294 254 221 166 159 178 121 60 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018* 2019* 2020* 2021* Source: IFR World Robotics 2018 Junji Tsuda Page 6 18 Oct. 2018

Emerging region Asia '000 of units *forecast 500 450 400 350 300 250 200 150 100 50 0 191 Estimated worldwide annual supply of industrial robots 2016-2017 and forecast for 2018*-2021* 262 298 351 56 66 71 75 83 94 41 46 44 49 56 64 2016 2017 2018* 2019* 2020* 2021* Asia/Australia Europe America Source: IFR World Robotics 2018 405 463 Junji Tsuda Page 7 18 Oct. 2018

China has significantly expanded its leading position China Japan Rep. of Korea United States Germany Taiwan Vietnam Italy Mexico France Singapore Spain Canada India Thailand Estimated worldwide annual supply of industrial robots 15 largest markets 2017 10.9 8.3 7.7 6.3 4.9 4.5 4.2 4.0 3.4 3.4 21.4 45.6 39.7 33.2 137.9 0 20 40 60 80 100 120 140 160 '000 of units Source: IFR World Robotics 2018 Junji Tsuda Page 8 18 Oct. 2018

China: Strong increase of robots sales of foreign companies 160 140 120 Annual shipments of industrial robots in China 2007-2017 +59% 34.7 '000 of units 100 80 60 40 20 0 +27% 103.2 27.0 20.4 16.0 60.0 48.2 9.0 41.1 22.6 23.0 27.6 6.6 7.9 5.5 15.0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Source: IFR World Robotics 2018 Junji Tsuda Page 9 18 Oct. 2018

Top 5 countries represent 73% of total sales in 2017 Estimated worldwide annual supply of industrial robots at year-end main markets 2015-2017 China Japan Rep. of Korea United States Germany 21 20 20 46 +18% 39 35 40 4% 41 38 33 +6% 31 28 +7% 69 87 138 +59% 0 20 40 60 80 100 120 140 160 '000 of units 2017 2016 2015 Source: IFR World Robotics 2018 Junji Tsuda Page 10 18 Oct. 2018

Main drivers of the growth 2017: automotive, electronics, metal Automotive Electrical/electronics Plastic and chemical products Food and beverages Unspecified Estimated annual supply of industrial robots at year-end by industries worldwide 2015-2017 2017 2016 2015 Metal Others 10 8 7 29 29 21 +9% 20 20 +19% 23 19 15 25 20 35 45 +55% 65 91 103 98 0 20 40 60 80 100 120 140 '000 of units 121 126 +22% +33% Source: IFR World Robotics 2018 Junji Tsuda Page 11 18 Oct. 2018

Key Drivers for Automation more relevant than ever Shift to high mix/low volume production Global competitiveness Digitalization of manufacturing Industry 4.0 Growing consumer markets Energy efficiency-driven technology shifts Regionalized production Image: KUKA Steven Wyatt Page 12 18 Oct. 2018

Main customer: automotive industry Transition from Internal Combustion Engines (ICE) to electric vehicles/hybrids Increased complexity Customization increasing mix requires more flexible production Automation of final assembly Automotive parts suppliers more SME s will use robots Image: FANUC Steven Wyatt Page 13 18 Oct. 2018

Main customer: electrical/electronics industry Continuously increasing demand for batteries, chips and displays Short life cycles of electronic products High turnover of people with associated labor shortages Increasing degree of robot adoption Higher quality demands on manufacturing process Image: ABB Steven Wyatt Page 14 18 Oct. 2018

Robot sales will in increase in all other industries Metal industries more flexibility and cost efficiency Rubber and plastics industry more integrated manufacturing concepts Food and beverage industry shift to even shorter production runs Pharmaceutical industry - improving productivity without sacrificing quality Image: Yaskawa Steven Wyatt Page 15 18 Oct. 2018

Highest robot density in Korea - lowest average in Asia 800 700 600 500 400 300 200 100 0 710 658 Number of installed industrial robots per 10,000 employees in the manufacturing industry 2017 322 308 240 230 Average world: 85 Average Europe: 106 Average America: 91 Average Asia: 75 200 197 192 190 172 167 161 157 151 144 139 137 129 119 97 units per 10,000 employees Rep. of Korea Singapore Germany Japan Sweden Denmark United States Taiwan, Prov. Belgium Italy Netherlands Austria Canada Spain Slovakia Slovenia Finland France Switzerland Czech Rep. China Source: IFR World Robotics 2018 Steven Wyatt Page 16 18 Oct. 2018

Technological Developments expanding Robot Adoption Today - More intelligent components, e.g. Smart Grippers - Greater connectivity, e.g. Plug & Play interfaces and Cloud Computing - Easier to Use, e.g. Programming by Demonstration Tomorrow Machine learning enables robots. - to learn by trial-and-error or by video demonstration. - to self-optimize. - to communicate with other machines to improve entire processes. New business models, e.g. Robotics as a Service (RaaS) Steven Wyatt Page 17 18 Oct. 2018

2021 : 3.8 Million Industrial Robots in the World s Factories 4,000 3,500 3,000 Estimated worldwide operational stock of industrial robots 2016-2017 and forecast for 2018*-2021* +16% on average per year 3,788 3,218 '000 of units 2,500 2,000 1,500 1,000 500 1,021 1,059 1,153 1,235 1,332 1,472 1,632 1,828 +15% +15% 2,408 2,098 2,778 *forecast 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018* 2019* 2020* 2021* Source: IFR World Robotics 2018 Steven Wyatt Page 18 18 Oct. 2018

Professional Service Robots have entered our daily lives Value of sales 2017: US$ 6.6 bn, +39% 2018: US$ 8.7 bn, +33% 2019-2021: US$ 37 bn, +19% (CAGR) Unit sales: 2017: 109,500 units, +85% 2018: 165,300 units, +32% 2019-2021: 736,600 units, +21% (CAGR) Gudrun Litzenberger Page 19 18 Oct. 2018

Professional Service robots: Main drivers of the value growth are logistic systems US$ million *forecast 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 17,528 Service robots for professional use. Main Applications Estimated values 2016 and 2017, forecast 2018* and 2019*-2021* 9,560 3,865 2,383 2,302 1,001 1,911 1,615 4,365 3,392 1,068 966 984 953 902 793 Logistic Medical Field Defense 2019*- 2021* 2018* 2017 2016 Source: World Robotics 2018 Gudrun Litzenberger Page 20 18 Oct. 2018

AGVs in factories, warehouses, logistic centers, hospitals 69,000 units installed in 2017, 162% more than in 2016 6,700 units in manufacturing 62,200 units in warehouses, logistic centers, hospitals 2018: 115,000 units, 66% higher than in 2017 2019-2021: 485,000 units, +18% on average per year Image: Omron

Image: AOT Carlo Medical robots most valuable service robots: US$ 1.9 billion in 2017 2017: 2,900 units, +75% 2018: 4,400 units, +49% 2019-2021: 22,100 units, +27% (CAGR) Field robots mostly milking robots 5,400 milking robots in 2017, slight increase Still low number but high increase: agricultural robots 520 units in 2017 up from 190 units 2018: 7,200 field robots, +17% 2019-2021: 32,700, +22% (CAGR) Image: Naio

Logistic systems are also the drivers of the growth in units '000 of units 600 500 400 300 200 485.3 Service robots for professional use. Main applications Units sales 2016 and 2017, forecast 2018*, 2019*-2021* *forecast 100 0 114.8 93.4 69.0 26.3 12.5 12.0 15.9 43.7 11.1 10.4 6.7 Logistic Defense Public relation 2019*- 2021* 2018* 2017 2016 Source: World Robotics 2018 Gudrun Litzenberger Page 23 18 Oct. 2018

High potential for exoskeletons '000 of units 45 40 35 30 25 20 15 32.7 Service robots for professional use. Other applications Unit sales 2016 and 2017, forecast 2018* and 2019*-2021* 40.5 10 5 7.2 6.4 5.9 7.0 6.1 5.6 4.4 2.9 0 1.7 4.2 1.1 0.9 0.7 Field Exoskeletons Medical Construction *forecast 2019*- 2021* 2018* 2017 2016 Source: World Robotics 2018 22.1 Gudrun Litzenberger Page 24 18 Oct. 2018

Vacuuming and floor cleaning robots are most established personal/domestic service robots / revised graph 5 Dec. 2018 12 Service robots for personal/domestic use. Estimated value 2016 and 2017, forecast 2018* and 2019*-2021* 10 11.1 billion US$ 8 6 4 2 0 *forecast 2.0 1.6 2.0 0.5 1.2 0.4 0.4 Household robots Entertainment and leisure robots 2019*- 2021* 2018* 2017 2016 Source: World Robotics 2018 Gudrun Litzenberger Page 25 5 Dec. 2018

2017: 8.5 million units, +25% - considerable increase expected million units 45 40 35 30 25 20 15 39.5 Service robots for personal/domestic use. Unit sales 2016 and 2017, forecast 2018* and 2019*-2021* 10 10.7 5 7.5 6.1 4.7 0 2.8 2.4 2.1 Household robots Entertainment and leisure robots 2019*- 2021* 2018* 2017 2016 *forecast Source: World Robotics 2018 Gudrun Litzenberger Page 26 18 Oct. 2018

More than 700 service robot companies identified Number of service robot manufacturers of all types (professional and personal/domestic use) by region of origin Asia, 133 Others, 29 Europe, 307 North America, 250 Gudrun Litzenberger Page 27 18 Oct. 2018

Thank you! Contact: Gudrun Litzenberger International Federation of Robotics IFR c/o VDMA Robotics+Automation 60528 Frankfurt Main, Germany Email: gl@ifr.org Phone: +49 69 6603 1502 Internet: https://ifr.org/ Gudrun Litzenberger Page 28 18 Oct. 2018