IHS Insight Perspective
The market for servo motors and drives is benefiting from the increased emphasis on energy efficiency, as most servo motors utilize permanent magnets to achieve high efficiency levels. However, the reliance on rare earth magnets has negatively impacted the servo market recently, as the price increase of 2011 demonstrated the volatility of both the supply and price of rare earth magnets and forced many suppliers to pass their cost increases on to customers. For low performance servo motors with powers below 5HP, a closed loop vector VFD may be used for position control instead of a servo drive to reduce the cost of the system.
M&A activity has been high in the last five years, including the end of Yaskawa and Omron's European drives joint venture in late 2009. Other notable acquisitions include the purchase of Baldor Electric Company by ABB in 2010 and the purchase of Animatics by Moog in 2011.
This analysis represents a clustered, group analysis of 3 similar AC servo drives for use in industrial markets, specifically a factory automation setting.
Omron 3G3MX2 - Is a 3 phase, 200V, 0.4kW drive. Per Omron the 3G3MX2 'is specifically designed to drive machines.' This drive is designed to offer operation from near stand-still (0.5Hz) to 1000Hz, offering 'precise operation for fast cyclic operations and torque control capability in open loop'.
AC motor drive equipment such as this is typically employed in factory environments, where automated control of motor-driven systems is required.
Omron 3G3MX2 - Press release October 2009
Pricing and Availability
$350 Per unit in low volumes See below See below
Omron 3G3MX2-A2004 - $350 USD - single piece break (Jul 2012) - Pricing varies based on exact model.
All these drives are sold internationally via distributors primarily
220,000 Annual Units
10 Total Years
For the purposes of this teardown analysis, we have assumed an Annual Production Volume of 220000 units and a Product Lifetime Volume of 10 year(s).
Teardown volume and production assumptions are primarily used for our cost analysis in terms of amortized NRE and tooling costs, especially for custom components specific to the model being analyzed (mechanical components especially). Unless assumed volumes are different by an order of magnitude, minor changes in volume (say 1 million vs. 2) rarely have a large net effect on our final analysis because of this.
According to IHS IMS Research's Motion Controls annual research, global revenues for servo drives are forecast to grow significantly in 2011, by 15.8% to $4,584.4 million, continuing on the strong recovery started in 2010 when the market grew by 23.6%. In unit terms the servo drives market is expected to reach just over 7 million pieces in 2011, including both GMC and CNC drives, although over 70% will be in the general motion space. The market is expected to have surpassed pre-recession levels in 2011; however, the high growth from the past two years cannot be sustained in 2012. The market benefitted from a strong resurgence in machinery production following the downturn, which is estimated to have grown 17% in 2010 and another 10.2% in 2011. However, as machinery orders slowed in 4Q 2011 the impacts in 2012 are expected to be significant. A strong backlog of machine orders, particularly machine tools, sustained the motion controls market through the first half of 2012, but as orders for new machines remained low and has shown no signs of returning to growth in the second half of 2012, the servo drives market is expected to decline in the second half of the year.
The largest region for the servo drives market, in terms of sales, has long been Europe, Middle East & Africa (EMEA), due primarily to the number of machine builders in the region. Sales of servo drives in EMEA are forecast to reach $1,601.5 million in 2011, after a much more subdued recovery than the other regions. However, due to high forecasted growth in the Asia Pacific market over the next several years, this region is predicted to overtake the EMEA and become the largest consumer in 2014. Much of the poor performance in the 2H of 2012 is due to the size of the market in these two regions and the general economic slowdown in both China and the continued economic struggles in the Eurozone.
The market for servo drives is dependent on global machinery production, tracked by IHS IMS Research in "The Machinery Production Yearbook. The business cycle from 2006 to 2011 is a credible historical indicator of future growth as this period includes both a significant downturn, along with a strong recovery. When comparing historical performance of general machinery production and the overall motion controls market, the latter outperformed machinery production by just under 2%. Average growth from 2006 to 2011 for machinery production was estimated to be 6.1% in terms of revenues and, during the same time, approximately 8% in terms of motion control hardware.
Siemens, Fanuc, Mitsubishi Electric, Yaskawa Electric, and Bosch Rexroth lead the market share, most of which provide both GMC and CNC motion control products. These top five suppliers accounted for over 50% of the market in 2010. It is clear that the global motion controls market is dominated by European and Japanese suppliers, with only two US suppliers appearing in the global market share table.
Below is a list of the top 10 cost drivers found in this unit. As is the case with most teardowns - these items tend to represent the majority of total cost for the unit.
Total BOM: $63.84
Top Cost Drivers below: $36.25
% of Total BOM 57%
Main Cost Drivers below:
IGBT Module - 56x36mm IGBT Module, Potted, Integral Molded PPS Internal Mounting Brackek- (Qty: 1)
Renesas R5F61652D50FPV MCU - 32-Bit CPU, 50MHz, 384KB ROM, 4KB RAM, 75 I/Os, 8-Channel 10-Bit ADC, 2-Channel, 10-Bit DAC, I2C- (Qty: 1)
Enclosure, Main, Rear / Heatsink - Die-Cast Aluminum- (Qty: 1)
Renesas R5F71494AD80FPV MCU - 32-Bit, SH-2 CPU, 80MHz, 104MIPS, 256KB ROM, 8KB RAM, 63 I/Os- (Qty: 1)
MFS Technology 4-Layer - FR4, Lead-Free- (Qty: 3)
Phoenix Contact 1752191 Terminal Block - 11-Position, Vertical, Spring Cage Type- (Qty: 2)
Mitsubishi M81721FP MOSFET/IGBT Driver - Half Bridge, 600V, High Side- (Qty: 3)
Toshiba Semiconductor TLP285GB Optocoupler- (Qty: 5)
Renesas PS2815-1 - (Qty: 7)
MFS Technology 6-Layer - FR4, Lead-Free- (Qty: 1)
Not Included in Analysis
The total materials and manufacturing costs reported in this analysis reflect ONLY the direct materials cost (from component vendors and assorted EMS providers), AND manufacturing with basic test. Not included in this analysis are costs above and beyond the material manufacture of the core device itself - cost of intellectual property, royalties and licensing fees (those not already included into the per component price), software, software loading and test, shipping, logistics marketing and other channel costs including not only EMS provider and the OEM's margin, but that of other resellers. Our cost analysis is meant to focus on those costs incurred in the manufacture of the core device and exceptionally in some circumstances the packaging and literature as well.
General Notes on Drive Production
Production was recently determined to be shifting towards localization around the globe in the most recent research on Motor Controls by IHS IMS Research. Suppliers reported a general industry trend of relocating production closer to consumption. The Asia Pacific region, and more specifically, China, is seeing rapid growth in production of motor controls due much to local demand. This also means that regions including Eastern Europe, in particular Poland and Czech Republic, and Mexico are seeing increases in production to meet demand in Western Europe and the US.
IHS IMS Research estimates Asia Pacific was the clear production leader in 2011, accounting for 44% of the world total, followed by EMEA with 22%.
Country of Origin
For the purposes of this analysis, we are assuming the following country(ies) of origin for each level of assembly, based on a combination of 'Made In' markings, and/or assumptions based on our knowledge of such equipment.
Front Panel PCB - Japan
Interface PCB - Japan
Inverter Control PCB - Japan
Other - Enclosures / Final Assembly - Japan
Power Inverter PCB - Japan
Country of origin assumptions relate directly to the associated cost of manufacturing, where calculated by iSuppli. In the cases of 'finished' sub-assemblies (such as display modules), we do not calculate internal manufacturing costs, but rather assess the market price of the finished product in which case country of origin assumptions may or may not have a direct effect on pricing.
Labor rates are applied directly only to hand inserted components and systems in our bill of materials, and although regional assumptions do, these new rates do not have a direct effect on our modeled calculations of placement costs for automated SMD assembly lines. ""Auto" inserted components (such as SMT components) placement costs are calculated by an iSuppli algorithm which allocates a cost per component based on the size and pincount of the device. This calculation is affected by country or region of origin as well.
Component counts by assembly and the number of assembly are indicators of design complexity and efficiency.
Component Qty: 65 - Power Inverter PCB
Component Qty: 39 - Other - Enclosures / Final Assembly
Component Qty: 306 - Interface PCB
Component Qty: 287 - Inverter Control PCB
Component Qty: 175 - Front Panel PCB
Component Qty: 872 - Grand Total
At 872 components total, this AC Servo drive from Omron is 'in line' with other previous AC servo drives performed by IHS iSuppli which range from about 600 - 900 components for the range of devices we have torn down. Component complexity is usually a direct result of features set design choices.
The differentiator that the OMRON seems to offer internally is a special IGBT module that is built into the mounting bracket - it seems to be a special approach that is not used in the other drive designs in this analysis. Any customization of components such as this tends to add cost - but may offer unique performance characteristics that give Omron a competitive advantage. The 32-bit Renesas MCU is a very similar choice to other Japanese drives analyzed concurrently as well as in the past.