Potential vs. Challenges of the Thai Robotics Industry: A Major Step Towards Regional Excellence

One of the target industries that has recently received considerable attention is the Thai robotics industry. Thailand has the potential to design and manufacture its own robots, and is a key market for robots in the ASEAN region. Thailand's use of robots in the manufacturing sector has increased to 12th place globally and 1st in ASEAN. This statistical data is a good indicator that Thailand has adapted to the modern manufacturing sector, following the Industry 4.0 approach, becoming a leader in modern industry.

The Thai robotics industry is crucial because it is a transformative industry for Thailand's manufacturing sector. It provides a solution to address labor shortages and Thailand's transition to an aging society, enhancing the country's competitiveness.

The importance of robots in the development of Thailand

Looking back in time, when discussing robotics technology, many people might have considered it complicated and far-fetched. But today, robots have become increasingly involved in human daily life, including in offices, restaurants, hospitals, and industrial plants.

If we talk about robots, they can be divided into 2 main groups: robots used in factories, which are mostly in the form of stationary mechanical arms and systems used to transport various materials in the factory, and service robots, which can be divided into many types as well, such as mobile robots used to transport parcels in the office, serve food, transport goods between buildings, and also include

• Medical robots that will assist in delicate surgeries, with the robot's operation controlled by a doctor.
• Robots used in research that will work in high-risk areas such as the deep sea or volcanic craters.
• Security robots are used on the battlefield or in high-risk areas for surveillance, reconnaissance and attack.
• Entertainment robots that interact with people like playmates or pets.
• Household robots, such as house cleaning robots

The key to using robots for various purposes lies in their flexibility, their ability to be customized to perform a variety of tasks. When combined with AI (artificial intelligence), robots can be even more efficient. For all these reasons, the robotics industry has grown rapidly and become another engine driving the economy in an era where Thailand increasingly relies on robots.

As Thailand enters an aging society, the Thai manufacturing sector will inevitably face significant labor shortages in the future. Furthermore, with minimum wages trending upwards, manufacturers are urging the rapid adoption of robots, machinery, and automation to reduce production costs and address long-term labor issues.

Opening a window to the evolution of robot production and the countries that rely on robots the most in the world.

When it comes to robot production costs, they've been steadily decreasing. Therefore, it's no surprise that large manufacturers, including SMEs, are increasingly adopting robots in their production lines to replace human labor.

All of this is a significant pressure that has driven the use of robots in manufacturing and service sectors worldwide. In 2017, 381,000 industrial robots were sold worldwide. In 2021, the use of robots shot up to 517,385. If the COVID-19 pandemic had not occurred, the number of robots would have increased by more than 630,000 worldwide.

Asia is the region with the highest robot usage in the world. If you look at the latest data from the International Federation of Robotics (IFR) in 2021, you will find that robots are used in the manufacturing sector, and Thailand is ranked 12th in the world as the user of new robots, with 1,914 new robots.

The leading countries that use the most robots in the manufacturing sector are:

1. China 268,295, an increase of 51 percent
2. Japan 182, an increase of 22 percent
3. United States 34,987, an increase of 14 percent
4. South Korea 31,083, an increase of 2 percent
5. Germany 23,777, an increase of 6 percent
6. Italy 14,083, an increase of 6 percent
7. Taiwan 9644, an increase of 31 percent
8. France 5945, an increase of 11 percent
9. Mexico 5401, up 61 percent
10. India 4945, an increase of 54 percent

And robots used in the manufacturing sector are mostly in the electrical and electronic industry, 26 percent, followed by the automotive industry, 23 percent, the metal and machinery industry, 12 percent, the plastics and chemicals industry, 5 percent, and the food and beverage industry, 3 percent.

It is continuously assessed that the demand for robots in the industrial sector will continue to increase at a high rate due to the continuous decrease in the cost of robot production. In 1995, the cost of robot production was still at $131,433, until in 2014 the cost was adjusted down to $31,312, and in 2025, it is expected that the cost of robot production will be adjusted down to only $10,800.

The Thai robotics industry is an industry of hope that the government is promoting in every way.

With costs continually decreasing due to supporting factors in terms of advancements that help increase production efficiency, the cost of production parts has significantly decreased, and this will be a key factor in the increasing use of robots in terms of both production and service.

And the increasing use of robots in Thailand's manufacturing and service sectors has helped to increase the efficiency of Thai production and services, resulting in lower production costs. This has resulted in Thailand's competitiveness in the global market increasing accordingly.

Therefore, the robotics industry is considered a driving force behind Thailand's modern industrial landscape. For this reason, the government is collaborating with various agencies to promote Thailand's development of its own robotics technology, enabling it to be further developed in collaboration with all sectors of the Thai economy.

Given the importance of the robotics industry, the Ministry of Industry has issued measures to promote and develop the robotics and automation industry, with implementation periods from 2017 to 2026. These measures include measures to stimulate domestic robot use, aiming to encourage domestic entrepreneurs to increase robot use in the manufacturing sector. Various agencies are also prepared to offer special privileges to encourage increased robot use, as follows:

1. The Board of Investment (BOI) will exempt 50% of corporate income tax on investment for entrepreneurs who use robots or automation systems to improve production and service efficiency.
2. The Ministry of Finance will exempt 300% of corporate income tax on expenditures for research and development of robotics and automation technology, as well as support the procurement of domestically produced robots and automation systems.
3. The Ministry of Industry will promote the use of robots and automation systems by SMEs to increase production efficiency through the SME Development Fund and other funds.

The goal of supporting domestic robot production is to increase the number and enhance the competitiveness of domestic robot manufacturers. This focus will be on increasing the number of System Integrators (SIs) who manufacture, develop, and install robotic and automation systems. The BOI will provide the highest level of investment promotion privileges, and the Ministry of Finance will waive import duties on parts used in robot and automation production. Personnel development and technological upgrades will also be accelerated.

Eight pilot agencies will certify the qualifications of SIs for tax incentives, technology transfer, and human resource development related to robotics. The short-term goal is to increase investment in robotics by 12 billion baht by 2017. This will lead to an expansion of robotics and automation, with factories using robots achieving a 50 percent increase in efficiency. This will also promote the creation of more automated warehouses.

The mid-term goals of the robotics and automation industry for 2017-2022 are as follows:

• Expand investment with robots and automation systems of no less than 200 billion baht.
• Use robots in at least 50% of factories.
• Produce robots and automatic machines to replace imports by at least 30 percent.
• ส่งเสริมการวิจัยหุ่นยนต์ทางการแพทย์ หุ่นยนต์ดูแลผู้สูงอายุ อากาศยานไร้คนขับ หุ่นยนต์ที่ทำงานร่วมกับมนุษย์
• สร้าง System Integrator หรือ SI จากจำนวน 200 ราย เพิ่มเป็น 1,400 ราย

As for the long-term goal, within the 10-year period until 2026

• Thailand will be a leader in the use and production of robots in ASEAN.
• Have own technology and export robots
• There is research and development of smart factories, smart agriculture, smart homes, and driverless vehicles.

If we analyze past data, we find that industrial factories have invested approximately 186 billion baht in robotics and automation systems. There are 245 businesses promoting investment under production efficiency improvement measures, worth over 26.851 billion baht.

Are the research findings on "Measures to Promote the Thai Robotics Industry" truly on target and meeting the needs of the industrial sector?

Furthermore, in accomplishing the mission to promote the robotics and automation sector in Thailand, we have received excellent cooperation from the private sector and the academic sector, which have provided perspectives that have effectively supported the development of the Thai automotive industry.

In the academic sector, Dr. Thanyawat Somjaitaveeporn, Director of the Robotics and Automation Center, Panyapiwat Institute of Management, and Assoc. Prof. Dr. Natthasit Kerdsri, Head of the Technology and Innovation Management Operations Team, Mahidol University, jointly studied the government's past performance.

It was found that past government investment promotion measures have contributed to increased investment in upgrading manufacturing processes to reach Industry 4.0. In 2021, 15 projects worth 1.2 billion baht were invested in improving work processes using automation and robotics.

In 2022, 85 projects were submitted, valued at over 7 billion baht. Currently, the industrial sector is experiencing rapid growth in demand for robots, while the number of domestic robot service providers remains insufficient. Therefore, the government needs to accelerate promotion of the robotics and automation industry by increasing the number of robot operators through various special measures, such as low-interest loan sources, promoting startups, and creating new entrepreneurs.

Furthermore, robot production in Thailand relies heavily on imported materials and parts. To achieve sustainable growth in the Thai robotics industry, it is crucial to attract investment to establish domestic production bases for parts and equipment. This also requires establishing a Robotics Industry Promotion Committee (Robot Board), similar to the modern automotive board, which contributes to the efficient growth of EV (electric vehicle) development in Thailand.

Since the development of the robotics industry involves many other industries and requires complex technology, it is necessary to have a dedicated agency that closely monitors the development to ensure robust growth.

Dr. Prapin Apinaraset, President of the Thai Automation and Robotics Association (TARA), provided an interesting comment: "Although the government has provided full support and encouragement to the robotics industry in the past, there are still many issues that the government must urgently address to strengthen the robotics industry." Dr. Prapin pointed out the following points:

• Amend investment promotion measures to improve BOI production efficiency to make it more accessible for SMEs Because the current regulations are too strict, resulting in few SME entrepreneurs being able to participate in government projects.
• Amend investment promotion measures to improve production efficiency This is a measure that must be renewed annually, forcing entrepreneurs to yearly wait to see if the measure will be renewed. Therefore, this measure should be made long-term, so that the private sector can more easily plan their businesses.
• Improved import tax measures for equipment used in robot assembly This is especially true for operators who act as System Integrators (SIs), who currently benefit very little from this measure. SIs' robot assembly plants are typically small and can only import a small amount of equipment. Foreign companies are reluctant to sell equipment to them, so they must purchase from distributors in Thailand, who are not SIs. Therefore, they are unable to receive tax exemptions on these devices. As a result, SI companies that need these devices do not benefit from the tax exemption measures at all.

"Therefore, the solution is to establish regulations allowing SI companies to purchase these devices tax-free, or allowing SI companies to claim a tax refund. This will enable Thai SI operators to become SMEs, benefiting from government incentives and lowering costs, enabling them to compete with foreign SI companies and robot manufacturers."

Sharing the private sector perspective of TKK Corporation on Thailand's prominence as a leading SI company in the region.

As mentioned, a key strategy for developing the Thai robotics industry requires raising the competitiveness of domestic robot manufacturers by increasing the number of System Integrators (SIs) who manufacture, develop, and install robotic and automation systems. This concept aligns with the Thai SI company, TKK Corporation Co., Ltd., which has experience providing consulting services to industries seeking to transition to automation and robotics in Thailand and has a portfolio of robot design and manufacturing recognized by the Thai industrial sector.

By Kanlayani Kongsomjit, Executive Chairman of TKK Corporation Co., Ltd., who gave an interesting perspective on this issue:

"Having worked with companies in Japan, China, and Korea, I can tell you that Thai SI firms are more capable than many in ASEAN. Going forward, system integrators will become increasingly important, especially during this COVID-19 pandemic, which will be a turning point for every industry sector, including the food, machinery, textiles, petrochemicals, and automotive. Supply chains will become shorter, communications will become faster and easier, and investment decisions will be made without hesitation."

"In the past, we have seized this crisis and turned it into an opportunity to develop the robotics and automation industry in Thailand. Once the COVID-19 crisis eases, this industry will play a significant role in transforming Thailand's image. I personally believe that Thailand will become a leader in the Asia-Pacific region."

“เพราะเรามีบุคลากรที่มีความเชี่ยวชาญ ทักษะ ดิจิทัล โดยเฉพาะด้านหุ่นยนต์และระบบอัตโนมัติ ซึ่งจากการได้เคยทำงานร่วมกัน พบว่าแต่ละท่านมีความรู้ ความสามารถมาก มีทั้งที่เป็นอาจารย์ เป็น Startup รวมถึงเป็นบุคลากรที่ทำงานอยู่ในหน่วยงานภาครัฐและเอกชน ดังนั้น ถ้าภาครัฐและภาคเอกชน ร่วมมือกันเข้ามาส่งเสริมคนเก่งเหล่านี้ ย่อมเป็นอีกทางหนึ่งที่จะพัฒนาภาคอุตสาหกรรมหุ่นยนต์และระบบอัตโนมัติของไทยให้เป็นตัวแปรในการยกระดับการพัฒนาประเทศไทยได้อย่างแน่นอน” คุณกัลยาณีกล่าวในที่สุด