ABB’s decision to sell its robotics business to SoftBank for $5.4 billion raises a fundamental question: why exit one of the few industrial sectors almost universally expected to grow?
The company had previously considered spinning off the division as a standalone business but ultimately opted for a clean sale.
The move may provide ABB with capital to reinvest in its more profitable electrification and automation units, but it also means surrendering a foothold in a market with long-term potential.
Exiting a growing market
Robotics adoption is far from saturated. While China has become the largest user of industrial robots, installing more units annually than the rest of the world combined, many large economies remain at an earlier stage.
India, for instance, has yet to roboticise its factories at anything like the scale of China. The same applies to much of Southeast Asia, Latin America, and Africa, where industrial production still relies heavily on human labour.
Sooner or later, these markets will adopt automation on a massive scale. By exiting now, ABB is giving up the opportunity to be part of that expansion.
Missing synergies
ABB has explained that robotics never integrated seamlessly with its other business units, particularly electrification and process automation. But this explanation raises another question: why not?
Robots are increasingly central to manufacturing, logistics, food processing, and healthcare. Many of these industries also depend on ABB’s core products. Competitors have shown it is possible to create synergy.
Epson, for example, originally developed robots to assist its own manufacturing operations. That internal need gave rise to a robotics business that now claims to be the world’s largest supplier of delta robots.
Why ABB, with its vast industrial footprint, failed to find such alignment is puzzling. Was it a matter of internal priorities, leadership focus, or simply the long payback periods inherent in robotics?
Engineering excellence
ABB has been admired in the robotics world for the quality of its designs, its emphasis on user-friendly presentation, and a culture of engineering excellence.
Its robots are widely used in automotive and electronics production and are often considered among the most reliable in the industry.
Yet ABB never sought to expand its robotics business beyond industrial arms. It missed the chance to enter adjacent markets like humanoid robots, service robots, or even construction robotics.
With humanoids now attracting venture capital and headlines, ABB is stepping away from the one division that could have been its entry point into embodied AI.
SoftBank’s options
SoftBank’s record in robotics is mixed. It owned Boston Dynamics before selling it on, and its humanoid robot Pepper never achieved widespread adoption.
The company now frames its vision as “Physical AI”, suggesting a renewed focus on combining artificial intelligence with embodied machines.
Whether ABB Robotics will thrive under SoftBank’s ownership remains uncertain. There is also the possibility that SoftBank could eventually sell the division again, perhaps to a Japanese rival such as Fanuc or Yaskawa, or to China’s fast-growing automation companies.
A difficult business
Robotics is not a straightforward sector. Short-term profits are elusive, development cycles are long, and hardware is harder to scale than software. It may be that ABB simply concluded the capital and patience required outweighed the potential return.
And yet, robotics still represents one of the few industries with clear long-term growth drivers.
Manufacturing automation continues to expand, logistics robots are proliferating, and entirely new fields are emerging – from construction automation on Earth to the prospect of robotic activity on the Moon and beyond.
Lessons from the PC industry
There is also a question of maturity. Could industrial robots eventually become like personal computers – an essential but commoditised product, no longer generating excitement or commanding high margins?
If so, ABB may have judged it better to step away before robotics becomes a low-margin business.
On the other hand, robotics could just as easily follow the trajectory of smartphones – evolving into ever more capable machines that become indispensable across every sector.
The certainty principle
ABB may have chosen the certainty of a multibillion-dollar payout over the uncertainty of long-term growth. But in doing so, it has left the robotics stage at a moment when the script is still being written.
SoftBank’s plans may or may not succeed, but one thing is clear: the global robotics market is only beginning its expansion. Whether ABB will come to regret walking away depends on how quickly – and how widely – the next wave of automation spreads.
