Workers at a factory of Wasion Group Ltd in Hunan province, Nov 7, 2016.
Maker of electronic system devices pushed by labor costs and pulled by overseas demand
Wasion Group Ltd, the Hunan-based manufacturer of electronic power meters and data collection devices, plans to invest 15.91 million yuan (.32 million) over the next three years to upgrade its production facilities with more industrial robots, said senior executives.
Its products are widely used in sectors such as the energy-supply industry, construction, petroleum and petrochemicals, transportation, mechanical manufacturing and residential use.
Zheng Xiaoping, vice-president in charge of operations at Wasion, said the project will be completed by 2019. Each of its smart meter assembly workshops will be able to cut staff from 71 to 14.
The investment will be used for industrial robots, equipment, software, communications infrastructure and technology.
"Robots have operating advantages in limited spaces, especially in small-workpiece processing, material movements and assembly," said Zheng.
"These high-end devices have become the preferred method for industrial upgrading of products of all sizes in China," he said.
Wasion has exported electronic power meters and data collection devices, including remote large-diameter water meters, meters that accept prepaid cards, smart energy management terminal units and smart distribution automation equipment, to more than 20 overseas markets including the United Kingdom, France, the Netherlands, South Korea and Indonesia.
Supported by 3,400 employees, including 600 researchers, Wasion's revenue amounted to 2.96 billion yuan in 2015, up 6 percent on a year-on-year basis, while its profit reached 424 million yuan. It posted 206 million yuan profit in the first half of this year.
Eager to enhance its earning ability in overseas markets, it has established sales branches and services stations in more than 40 countries and regions including Mexico, Japan, South Africa, Germany and Russia.
Wasion used to focus on exporting its products to developed markets because they had high demand to control their revenue from both the power and the energy sectors and demand to install more electronic power meters in residential communities. The Chinese company has begun to deploy more resources in domestic markets in recent years.
"China's national development strategy now emphasizes quality growth as well as 'green', low-carbon and sustainable development. Wasion is keen to participate in the country's power or energy-related projects, from infrastructure facilities to new energy vehicle projects," said Zeng Xin, another vice-president of the group.
All the company's workshops will be equipped with industrial robots by 2019. It currently has eight subsidiaries carrying out different manufacturing and investment businesses.
Zhao Ying, a researcher at the Beijing-based Chinese Academy of Social Sciences' Institute of Industrial Economics, said the country's surging wealth and fast pace of urbanization have caused labor-intensive industries to struggle as they face a myriad of difficulties, such as recruitment problems and high employee turnover rates.
The average labor cost in China has risen fast in the past five years, to more than 67,000 yuan a year in 2015 from less than 28,000 yuan a year in 2008, according to a report by the Beijing-based Institute of Industrial Economics in July.