Hyundai Heavy Industries (HHI) Group has announced its goal of achieving annual sales of KRW 1 trillion in robot business by 2024, one of the group’s future growth engines.

At Friday’s BoD meeting, HHI Holdings resolved to demerge HHI’s robot business division ‘Hyundai Robotics’ into a separate entity as a subsidiary. Following the contemplated split-off, Hyundai Robotics will aim to position itself as a global top-tier robot maker building on its unassailable market presence in South Korea as the No. 1 player.

Seeing it as one of the group’s next growth engines, HHI Holdings has made relentless endeavors so far to nurture the robot business as evident in the proactive investments made in production facilities at home and abroad as well as the strategic cooperation formed with leading global companies. Having successfully laid the groundwork for operating the business as a separate entity based on these efforts, Hyundai Robotics ambitiously aims to generate annual sales of KRW 1 trillion by 2024 by spurring the entrance of its industrial robots into overseas markets while also expanding further into new businesses, such as smart factories, smart logistics and mobile service robots following the planned demerger.

A particular focus will be put on efforts to drive up the proportion of these new businesses (i.e., smart factories, smart logistics, etc.) in the company’s sales mix to at least 30% by 2024. Indeed, it is already seeing visible achievements in the smart factory business after making its first entrance into the sector last year. Annual orders won in this sector are expected to exceed KRW 80 billion this year, up more than five-fold from last year, and continue to rise sharply even after 2020 with an annual sales projection of over KRW 100 billion each year.

Hyundai Robotics is also poised for entrance into the smart logistics automation market. Based on the projection that the domestic market for smart logistics automation will rapidly grow to nearly KRW 1 trillion by 2024, it plans to form a joint venture with a local logistics system-specialized company to gain an early edge in this market.

Also, Hyundai Robotics has successfully commercialized ‘UNI’ recently, the mobile service robot developed and manufactured in collaboration with KT. To be deployed at a hotel in Dongdaemun, Seoul, starting next month, a unit of UNI will offer various services including concierge service and amenity delivery, equipped with self-driving and voice recognition technologies. Going forward, Hyundai Robotics plans to develop and commercialize a wider range of service robots offering day-to-day assistance at large retail stores, restaurants and homes.

The leading robot manufacturer is also proactively hitting overseas markets with its industrial robots. Since its initial advancement into China late last year, Hyundai Robotics has been successfully expanding its presence in the world's largest robot market, expected to win orders worth USD 30 million this year, up more than four-fold from a year ago. With a plan to complete the establishment of its European branch by early next year, it is looking to make further inroads into global markets.

“The contemplated demerger will lay the foundation for us to grow into a global top-tier robot company,” said Seo Yoo-seong, CEO of Hyundai Robotics. “We aim to further strengthen our competitiveness through active investments in R&D projects and large-scale facilities, and are also considering attracting strategic investment partners down the road.”

Starting off as the robot business team within HHI in 1984, Hyundai Robotics became the first South Korean robot maker to develop robots for automotive manufacturing and LCD handling robots among others, thereby solidifying its invincible leadership position in the domestic market. In 2018, Hyundai Robotics posted KRW 266.7 billion in sales.