Major shift to automated systems in distribution centres will fundamentally transform space

Just as COVID-19 is pushing automation into the spotlight in the short term, long-term projections suggest major transition

Credit: PRNewsfoto/IDTechEx

Automation is soaring up the agenda for distribution centres and will propel the market for autonomous systems over the next 20 years. According to research from IDTechEx the market – in total – will reach $81 and $290 billion in 2030 and 2040, respectively.

This is a colossal transfer of value from wage expenses to a combination of capital investments and service subscription to autonomous robots of various types. This staggering headline is, of course, very large, and hides the key individual trends characterizing each technology and use case.

Goods-to-person automated carts/robots

Large fleets of robots are already deployed to help automate the goods-to-person step in many fulfilment centres. These robots move racks within robot-only zones, bringing them to manned picking stations.

This is a fast-growing market space. The landscape was set on fire when Amazon acquired Kiva Systems for $775M in 2012, thereby leaving a gap on the market. Today, significant well-funded alternatives such as GeekPlus (389$M), GreyOrange (170$M), and HIK Vision ($6Bn revenue) have emerged, achieving promising and growing deployment figures. The number of start-ups has also increased, especially within the 2015-2017 period.

IDTechEx forecasts the annual unit sales to double within six years. Despite the large deployments already, they assess the real global inflection point to arrive around 2024 beyond at which point the pace of deployment will dramatically accelerate. Indeed, the research firm forecasts that between 2020 and 2030, more than 1 million such robots will be sold accumulatively.

Collaborative autonomous mobile robots

Another major trend is the use of autonomous mobile robots and vehicles. Autonomous mobile robots are emerging, which offer infrastructure-independent navigation in defined indoor environments. These robots boost productivity and enable many hybrid human-robot interaction modes. They can also bring automation to warehouses and fulfilment centres which were not specifically designed and built to support robotic goods-to-person.

The technology is enabled by better SLAM algorithms. The algorithms – based on different sensors, including stereo camera and 2D lidars – are evolved enough to handle safe autonomous navigation within many structured indoor environments with a high degree of control and predictability.

The technology options however are still many, and choices have long-lasting strategic consequences. The business models are also various and evolving. Some are offering their technology as RaaS (robot as a service).

There have also been some notable recent acquisitions. Amazon acquired a company focused on camera-based navigation, which would enable object detection and classification, and thus more intelligent navigation. Shopify acquired a firm with a full solution, including the entire software stack. Overall, the IDTechEx forecasts that more than 200k robots could be sold within the 2020-2030 period (this figure includes those that can perform picking of regularly or irregularly shaped items).

Mobile Picking Robots

Picking or grasping technology is an essential component of warehouse automation. Today, many firms and research groups are deploying deep learning to enable robots to pick novel and irregularly shaped items rapidly and with high success rates.

A limited number of firms have integrated picking arms on mobile platforms. Today, these mainly pick box-shaped items in known environments. However, progress will bring these technologies to more varied items. It will also allow better integration of the robotic arm with the mobile platform.

In the short term, more learning is required. However, recent advances on the algorithm side suggest that progress will be rapid although the algorithms will need to achieve not just high rates but also high-speed to drive down the ROI on these tools. In the very long term though, IDTechEx forecast that 36% and 38% of AMRs in warehouses sold in 2040 will be able to pick regular – as well as irregular-shaped items, respectively. This points towards a major long-term technology transformation, requiring automation beyond just autonomy of movement. IDTechEx Analysts consider this a major technology development opportunity.

Autonomous forklifts and other industrial vehicles

Autonomous forklifts and tugs are emerging onto the market. The navigation technology has progressed significantly. Naturally, the cost of autonomous forklifts is higher, but the claimed ROI by many suppliers is within 12-18 months. The cost includes the installation and maintenance as well as the cost of the autonomous sensor suite, traction control and drivers, and the software, which can be amortized over a growing deployed fleet. Overall, price parity on an annual operational cost basis is nearly at hand in some high wage territories.

The unit sales here can reach 1.8k in 2020, which seems a high number but still small relative to the addressable market. Over the past 1.5 years, however, this market has also entered the early stages of its growth phase. Analysis and interviews conducted by IDTechEx suggest that inflection point is likely to be reached around 2025-2027. After this point, they project the sales to grow, already exceeding 100k units by 2030.

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