Are Chinese warehouse’s robots U.S. retail’s future?
Google deal means such automation may come soon to America.
SHANGHAI — Inside a warehouse the size of seven football fields, hundreds of robots pack roughly 200,000 boxes each day and ship them to customers across China. Four humans baby-sit.
One is Zou Rui, 25, a soft-spoken engineer who stands for much of his eight-hour shift in New Balance sneakers, monitoring a milky white mechanical arm. It plunges up and down like a pecking chicken, grabbing parcels with a suction-cupped hand and dropping them into containers on a conveyor belt.
If something looks odd, Zou rushes to fix it. Otherwise, he said, he jots notes in a binder, tracking the arm’s performance for his remote bosses. Or he chats online with his colleagues: two men and a woman, all about his age.
Here, Zou is far from his family’s cornfields in the eastern province of Anhui, far from the bustle of his old workspace with 100 or so people. But he doesn’t feel isolated.
“I don’t get lonely,” he said, “because of the robots.”
Zou works for the Chinese e-commerce giant JD.com, which lauds this warehouse on the outskirts of Shanghai as one of most automated in the world. Analysts say it’s a peek at the future of manual work in China and beyond — a place where a chosen few tend to the machines, while most workers have been rendered obsolete.
Thanks to a “strategic partnership” with Google, that future could be coming soon to the United States.
But Chief Executive Richard Liu wants to take the high-tech concept even further in a country once known as a hub for cheap labor.
“I hope my company would be 100 percent automation someday,” Liu said at an April retail conference in Madrid. “No human beings anymore.”
His facility near Shanghai serves as a learning lab for the company — which reported a slim $18 million in profit last year on revenue of $55.7 billion. Executives hope it will prove to be a not-so-secret weapon against competitors Alibaba and Amazon, which are also racing to develop the next generation of e-commerce super machines.
While in the United States on a business trip, Liu was arrested Aug. 31 in Minneapolis on suspicion of rape. He was released, and no charges were filed. Liu returned to China, and JD.com issued a statement Sept. 5 claiming that Minneapolis police found no misconduct by Liu. The police investigation remains open.
JD aims to perfect its technology, spread it to the firm’s 500plus other warehouses across China, Thailand and Indonesia, which still depend on thousands of people, and eventually sell the system to businesses that want to shrink their own labor costs.
As of today, JD employs roughly 160,000 full-time workers in Asia. Over the next decade, Liu said, he hopes to see that number dwindle to “less than 8,000” better-paid staffers who work two or three hours daily.
The jobs would be “easier, more fun and less dangerous,” the com-
pany head said this spring.
JD signed its deal with Google in June, and Google announced plans to invest $550 million in the firm.
“This marks an important step in the process of modernizing global retail,” JD’s chief strategy officer, Jianwen Liao, said at the time.
JD also opened its first Chinese grocery store this year with Walmart. Shoppers there can pay with their smartphones.
The partnership with Google is expected to boost Google Shopping, a search engine for goods, and intensify the U.S. company’s domestic rivalry withAmazon, which has deployed more than 100,000 robots of its own around the globe.
Amazon, which launched its robotics program in 2014, doesn’t have any fully automated warehouses, but its fulfillment centers manage a wider variety of packages than JD’s four-person shop does. (Amazon’s chief exec- utive, Jeff Bezos, owns The Washington Post.)
In the warehouse where Zou works, machines guided by image scanners handle all the goods, largely cellphones and cameras and other rectangular-shaped electronics.
Packages travel along a highway of belts. Mechani- cal arms stationed through- out the network place the items on the right tracks, wrap them in plastic or card- board and set them onto motorized pucks dubbed “lit- tle red men” — a nickname inspired by the spunky creatures in the Minions films.
The little red men carry the parcels across a floor that resembles a giant check- erboard and plunk them down chutes to sacks. Computerized shelves on wheels retrieve the loads and trans- port them to trucks, which deliver most orders within 24 hours of a shopper’s click.
While people still outper- form robots on a range of tasks — lifting objects of various shapes and sizes, for example — economists predict that JD and other e-com- merce businesses are leading a shift that will displace mil- lions of workers worldwide in retail and manufacturing.
“This is the kind of technology I expect will disperse everywhere,” said Martin Ford, author of “Rise of the Robots,” which explores how artificial intelligence could reshape the labor market. “It’s absolutely inevitable that this will be a lot more disruptive than people imag- ine.”
A swath of jobs that follow patterns will vanish, Ford said — the global con- sultancy McKinsey predicts that robots could replace almost a third of the Amer- ican workforce by 2030 — and a new crop of highly skilled positions will emerge.
Demand is expected to swell for workers who can program and monitor machines, as well as for managers with superior commu- nication styles. (Artificial intelligence struggles with empathy.)
At JD, Cheng Hui, head of robotics research for the firm in San Francisco, said market forces propel the scramble to automate.
China is grappling with a labor shortage, he said.
The country’s one-child policy, which was in place from 1979 to 2016, shaved down today’s number of young job seekers, giving workers more leverage to ask for higher pay and better benefits.
Government officials have admitted the policy stifled population growth, making it tougher and more expensive for companies to fill vacancies.
Yao Meixiong, deputy director of the census with the Fujian Provincial Bureau of Statistics, has estimated that China’s young workforce (20 to 34) in 2030 would total 221 million, down 104 million from 2010.
“The logistics talent pool is not increasing as fast as what we need,” JD’s Cheng said. “In that sense, automation will help to relieve that demand.”