Germany-based Beckhoff Automation, an automation solution specialist founded in 1980 and headquartered in Verl, has been operating in the field of industrial automation for over 40 years. Its experience built and technologies developed during these years have earned the company partnerships and trust from the industrial big names such as Canadian machinery supplier Husky, Switzerland-based Georg Fischer and German robot manufacturer Kuka Robotics.
Beckhoff Automation's engineering team and experience also enabled the company to invent technologies such as EtherCAT and innovations based on the communication fieldbus that are being broadly used among machine builders and IPC companies.
Hans Beckhoff, owner and managing director of Beckhoff Automation, pointed out during an interview that Beckhoff Automation is an automation company that delivers the intelligence, power and anything that is needed to control a machine, a building, a windmill or others.
He founded Beckhoff Automation in 1980 and started the business with microprocessor-based controlled systems in the early period of the company's operation, but in 1986, the company turned specifically to PC-based control technologies - implementing real-time software onto hardware of an industrial PC to enable typical automation functionalities like PLC and motion.
With the PC-based control technologies, Beckhoff Automation managed to gain the ability to control machines via PCs in very early days and this allowed the company to bring a lot of unique features of machine control to its customers.
Today, with all the communication, data handling and analytics features, and modern control needs, Beckhoff Automation's technologies over PC-based control have further advanced. Beckhoff Automation's clients can now simply download programs from the company website and install onto their PCs to transform their PCs into a high-end machine control while maintaining all the features of a standard PC.
The software TwinCAT is the heart of Beckhoff Automation's business philosophy - to become a software-oriented company, but the software still needs a lot of supporting hardware to be able to perform its control ability on clients' high-quality machinery hardware. Therefore Beckhoff Automation has started expanding the development and production of its own-brand industrial PCs, I/O and fieldbus components, drive technology as well as control cabinet-free automation.
Beckhoff Automation is a company with deep technologies. What that means is that Beckhoff Automation is fully capable of developing motherboards for its industrial PCs by itself. It is producing the motherboards at its plants in Germany and has its own BIOS software and a team of operating system experts and engineers that are able to cut down the reaction times of its IPCs to only 100 microseconds. Beckhoff also has specialists for automation software as well as specialists for applications such as packaging, milling and assembly.
However, Beckhoff Automation does not only want to sell hardware and software to its customers; the company also wants to sell trust to them. Automation is a high-end technology, making it rather complicated and requiring close collaboration between its supplier and user.
The supplier and user have to work together and develop a close relationship in order to make most advanced projects to work. In Taiwan, Beckhoff Automation also has high-end supporting engineers that are ready to provide any assistance to its customers.
Beckhoff Automation's business strategy and structure helps it go through the difficult time during COVID
Despite the COVID-19 pandemic's impact on different industries over the past months, Beckhoff Automation still managed to achieve revenue growth in 2020 and further growth in 2021.
Commenting on Beckhoff Automation's excellent performance in 2021, the founder Beckhoff said that the company currently has around 5,000 employees worldwide and more than 2,000 of them are engineers. It also has 24 sales offices spreading around Germany, as the company hopes to be as near to its customers as possible, and many subsidiaries in 40 other markets outside Germany, including Taiwan.
Beckhoff Automation also has distributors and channel partners in more than 75 countries around the world to handle its product distribution and marketing. The company's sales increased to EUR1.182 billion (US$1.18 billion) in 2021, a record high with an on-year growth rate of 28% thanks to its employees' and partners' hard work.
Over the more than 40 years of operation, Beckhoff Automation enjoyed annual revenue growth for most of the years, but there are still some years when "we experienced a drop from or stay on par with the previous year's numbers because of a major financial crisis around the world," said Beckhoff. On average, the company still saw a revenue growth of 15% a year since 2000.
Beckhoff Automation has also been pushing to keep all its existing customers, and continue to win over new ones. Over the past 20-30 years, Beckhoff Automation has seen an increasing number of customers choose to stay with the company as they have great confident over the quality and pricing provided by Beckhoff Automation's solutions.
In Germany, Beckhoff Automation has stable teams of engineers and workers, which allow the company to develop and build innovative technologies and products. The company's structure as a family-owned business also provides many benefits in its operation. Beckhoff Automation is completely self-financed and does not need to face pressure from investors or banks.
With complete control of the company's business direction, the company can follow through its inventory strategy of maintaining four to six months of raw materials at its warehouses during the worst moment of the COVID-19 pandemic, while most other enterprises are instead trying to lose as much inventory as possible. In the end, the decision paid off and helped Beckhoff Automation through the crisis.
Another advantage the company has as a privately-owned company is that the management team does not treat the results as the ultimate goal as it is also looking for long-term developments to maintain its technological leadership.
The company's target each year is to launch new products with evolutionary features and to create something revolutionary every 5-7 years. Beckhoff Automation has already been doing so for many years and the strategy helped the company to create the principle of the PC-based control, the invention of bus terminals, linear motor and magnetic levitate movement technologies.
Another revolution is the new MX-System, which was introduced in November 2021. The system offers a flexible, space-optimized and intelligent system solution and sets a new level in industrial automation by completely replacing the conventional control cabinet.
This is also a duty for Beckhoff Automation: to bring new ideas to customers and to fulfill their needs and expectations. The development also helped the company to attract more new clients.
The warehouse policy helped Beckhoff Automation during the crisis, but the company is now also gradually seeing longer lead times for its shipments due to insufficient production capacity. For that, Beckhoff Automation already started an expansion project with the new capacity set to be online by the first quarter of 2022 and volumes doubled compared to the beginning of 2020, to allow the company to delivery more products.
With the increase in capacity, the lead time for orders is expected to return to normal in the second half of 2022. Clients' orders placed with Beckhoff Automation increased more than 60% on year in 2021, while its capacity only picked up 25%, but the gap will be narrowed in 2022.
Since automation is a technology that can be applied in a lot of industries such as healthcare, water treatment and entertainment, automation companies are expected to enjoy a bright future because of enormous demand from all over the places.
Beckhoff Automation offers one-of-a-kind solutions to satisfy increasing demand
Taking the COP26 event for an example, the discussion in Glasgow was about how "engineers have to save the world," says Beckhoff. "We need to invent new technologies that can make machines and manufacturing processes more effective and use less energy and raw material, and all the companies have to do this on a steady basis."
With the goal, more electric vehicles (EV) are expected to appear, which will require more semiconductors for production and relatively benefit the semiconductor and automation industries. Beckhoff Automation is delivering a lot of control systems to the semiconductor industry and also the assembly industry, because of the new manufacturing architecture coming to the market.
With Beckhoff Automation's powerful IPCs, the customers are able to correlate over 100 axes together, build complicated machinery and run the axes in very short cycle time of 100 microseconds.
This means that the machine can react faster and has higher production efficiency. The system also features IoT functionality that can collect data and store them to backend platforms for analysis.
Beckhoff Automation also has a lot of built-in measurement technology that the company believes should be integrated into the control and not as an extra machine. The company is offering packages with variety of choices customer can choose that suit them better.
Beckhoff Taiwan sees many business opportunities in the market
For the business in Taiwan, managing director of Beckhoff Automation Taiwan Phylex Ong talked about the branch office's status, successful cases, as well as the key factors hindering Taiwanese enterprises from adopting smart manufacturing applications and the company's solutions to help resolve the problem.
Ong noted that Beckhoff Taiwan was founded in 2018. The office is located in central Taiwan as he believes the place is the best to help cover all its clients in the market.
At the moment, Beckhoff Taiwan has around 19 employees with six of them being engineers and five salespeople. Apart from their own sales team, the company is mainly working with one distributor, which had partnership with Beckhoff Automation long before the branch office was established in Taiwan. The distributor has a total of five sales offices throughout the major cities of Taiwan.
Beckhoff Taiwan has also achieved many successful cases during its operation since 2018. It has partnered with Shieh Yih Machinery Industry (Seyi), one of the major servo press machine builders in Taiwan. In one of its machines, the company used Beckhoff's CX5140 embedded PC with a 15-inch Control Panel CP6902, supporting EtherCAT with TwinSAFE terminals within the same fieldbus. It has also acquired Beckhoff Automation's TwinCAT licenses that cover the HMI and TwinSAFE for the machine.
Since Seyi's machine requires huge servo model and drive that run up to 165KW, which is beyond Beckhoff's current portfolio, the company has sought a third-party servo machine that is running on EtherCAT to fulfill client's demand.
EtherCAT is one of the major inventions Beckhoff introduced to the market in 2003 and is the abbreviation for Ethernet for Control Automation Technology. It is based on standard Ethernet technology, but with intelligence, which makes it perfect for performing machine I/O. It is also widely recognized by worldwide IPC and machinery communities.
Beckhoff Taiwan also assisted Seyi in conquering many technical challenges such as deploying more sensors on its production lines to collect data for analysis, improving performance of its machines to meet safety standards and making its platform compatible with worldwide standard to satisfy clients in Europe, the US and Japan.
However, Beckhoff Taiwan itself still faces many challenges in the market. When the company first started in the market in 2018, the brand awareness of Beckhoff Automation was not very high in Taiwan's automation machine market, which has been dominated by Japanese and local brands.
To break through, the company decided to invest primarily in marketing in order to create differentiation from its competitors. Another key factor that slows down the company's expansion in Taiwan is that most automation users in Taiwan are more familiar with the PLC platform and it will require some time for them to learn more about Beckhoff Automation's PC-based control systems.
Therefore, Beckhoff Taiwan has been hosting bi-weekly TwinCAT workshops for local engineers and customers and is now seeing more of them turning to embrace TwinCAT thanks to the technology's advantages and benefits.
Pricing is another key challenge Beckhoff Taiwan is facing at the moment. Many Taiwanese and Japanese IPC players in Taiwan are usually offering rather competitive pricing for their products as compared to European players in the industry.
The machine building clients that procure cheap IPC solutions are often those who wish to compete against competitors in China who offer extremely cheap products, but these clients' cost cutting would usually turn out to erode their own profitability instead in the long term with their prices still being outmatched by the Chinese competitors.
For Beckhoff Taiwan, helping these clients to advance from competing in the low-end sector to the midrange and high-end ones is one of the key tasks. Since the proportion of Taiwanese machine builders who primarily focus on the high-end sector is still rather low, this means that the company still has a lot of room for growth.
The method is also how Beckhoff Automation was able to gradually grow its share in Germany's automation IPC industry. With Beckhoff Automation's technology breakthrough, the company believes its clients will choose to stay and continue to grow along with Beckhoff Automation.
Beckhoff Automation's technologies and innovations
Beckhoff Automation's various technologies can assist Taiwanese machine builders to accomplish their automation demand. Many companies have already joined EtherCAT Technology Group (ETG) to use EtherCAT, which has released up to 1Gbit/s and 10Gbit/s, up from the standard 100Mbit/s, for their machines.
Meanwhile, Beckhoff Automation is also offering many types of motors such as rotary and linear ones. A few of the innovations Beckhoff Automation has introduced are the XTS transport system (2012) and the XPlanar (2018) planar motion system with stationary coils and moving magnets. The XPlanar is a new way to perform intellectual conveyor functionality inside a machine as the system can control each mover individually by controlling the magnetic fields, which are generated by the stationary coils.
Users can perform interesting moving patterns with the technology that can be applied to food and drug packaging. Beckhoff Automation will also demonstrate the system at an upcoming show to present its leadership in automation innovations.
For Taiwan's semiconductor industry, EtherCAT has already become the standard communication terminal for the industry and the XPlanar will also be a perfect solution for semiconductor manufacturing because of dust-free requirement.
Beckhoff MX-System for control cabinet-free automation
Phylex Ong, managing director of Beckhoff Automation Taiwan
