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Chinese Factories Ramp Up Spending on Robotics Amid Major Automation Push

Chinese factories are snapping up robots left and right—and Japanese manufacturers are scrambling to keep up.

Over the past few years, China’s production sector has experienced many changes, including rising labor costs, a declining workforce and retail’s uncertain landscape. To remedy these issues, Chinese factories are spending more on automation, prompting Japanese manufacturers to roll out more bots, Nikkei Asian Review reported.

(Read more about robots taking over: Report: Millions of US Retail Jobs at Risk Due to Automation—Or Are They?)

Nationwide, many factories, including Xinlu’s Ningbo-based appliance parts plant, have replaced workers with robots to reduce operational expenses and increase quality. The plant recently trimmed its human staff from 10 workers on a line to just one, and installed Kawasaki Heavy Industries robots to take care of press processing.

“Labor costs have doubled over the last three years, but robots come with a guaranteed life of 10 years,” a Xinlu chairman told the Nikkei Asian Review.

Beyond just facing rising labor costs, China is also facing an increasing labor shortage. Since 2012, China has experienced a decline in factory workers, as the nation’s younger generations continue to pursue other careers. This issue was part of the impetus for Chinese companies to spend more on robots. And in 2015, China debuted its Made in China 2025 Initiative, a nationwide plan that would revamp domestic industries with new innovations and technology—including robots.

Japanese manufacturers are taking action to accommodate China’s swelling demand for automation. Kawasaki Heavy Industries is building 3,000 more robots at its Suzhou factory this fiscal year, while Nachi-Fujikoshi plans to open a new robot production factory in China by 2018, which is expected to boost capacity to 1,000 units monthly.

Despite talk about robots taking over many industries, including retail, there remains a positive light. Many worldwide companies, including Amazon and Walmart, have embraced automation, while also securing plans for their human workers. Technology, including robots, could reduce the negative aspects associated with factory work by enabling workers to take on better paying, new jobs in the factory and even contribute to innovation in upcoming years.