Chinese robot manufacturer forced to retract sales numbers
Thu 12 May 2016
A leading manufacturer of Chinese robots, Huazhong Numerical Control (HNC) was forced to retract parts of its annual financial report after admitting it included inaccurate information regarding robot sales.
The 2015 report, released in February, showed that HNC had made sales to the state appliance manufacturer Gree Electric. These sales were touted as among the most important of HNC’s new robot unit. However, media reports that Gree had not purchased any robots from HNC surfaced, and HNC was forced to issue a retraction. In the annual report, HNC stated, “So far, HNC has sold a few hundred gantry robots to GREE’s plants … (which) have operated well on household electrical appliance production lines at GREE’s plants and helped GREE cut its labour costs.”
Last Friday, GREE denied that it had purchased any industrial robots or robot components from HNC in 2015. GREE did purchase robot controllers from HNC in 2014, which it then used to make its own gantry robots. HNC’s retraction noted that while it sold control system components to GREE it did not sell robots, and that those sales were made in the time period 2012-2015, not in fiscal year 2015.
Shares of HNC stock have reportedly dropped in value by 20% since the announcement. This shock could be felt industry-wide, as sales figures are the key to Chinese robot manufacturers accessing lucrative government subsidies. In April, Chinese government officials issued a directive that called for Chinese robot manufacturers to become competitive with foreign producers in the world market by 2020. The directive called for robot makers to become more innovative and competitive, with an eye to retaining manufacturing that has moved to China from abroad, helping to keep labor costs low.
Since 2013, China has had the world’s largest market for industrial robots, with 70% of the estimated $32 billion industry centered on China. Currently China’s industrial robot servo market is dominated by foreign companies, who retain 85% of market share. In 2012, HNC acquired Wuhan Huada New Type Motor Co. and Golden Age Motor Technology, and was able to start production of HNC AC servo motors. In May 2015 they created the subsidiary Foshan Golden Age Motor Technology Company to create industrial robot servo motor products.