- Europe has been a strong force in robotics but it is starting to fall behind China and the US. Robotics investment grew by almost +230% over 2019-2024 and the market is poised to outpace USD100bn by 2030. China has become the largest consumer of robots by far, accounting for 51% of total annual installations of industrial robots, and its robotic industry is growing steadily. The robotics industry in Europe is at risk of disruption from incumbents supported by strong industrial policies, and new players emerging from the tech ecosystem amid the AI frenzy. As robotics could deliver increased productivity, help to address Europe’s demographic challenges and protect its industrial sovereignty, the region should act now to avoid following the fate of the auto industry, leaning on five levers:
- 1. Develop and implement a European robotics roadmap. Europe needs a strategic plan and a clear operational vision to ramp up its robotics sector. We suggest that such plan should focus on building robotics champions to first serve domestic sectors that are (i) less robotized, (ii) face productivity or recurrent labor shortage issues and are (iii) difficult to offshore and/or strategic. Namely, transportation and logistics, hospitality, agrifood, construction, healthcare, aerospace and defense. Europe should also avoid chasing robotics applications in which it is already falling behind too much (i.e. humanoids, autonomous vehicles).
- 2. Enhance access to capital for robotics start-ups. Europe should further develop a legal and business framework to increase the critical size of the venture capital market, whose funding capacities are complementary to public and private efforts. The capital-intensive nature of the robotics industry, which is even more pronounced for developing new AI-empowered smart robots, means that Europe cannot overlook any funding channel. The US currently attracts seven times more VC investments in AI compared to Europe, which could weigh on Europe’s innovative capabilities and lead to a technology lag.
- 3. Scale up innovation from research to market. Europe’s weakness lies in its market fragmentation and lack of cooperation to promote private investment. In this context, it needs to support the construction of regional champions and/or promote investment pooling to play a prominent role in the ongoing technology race for AI leadership. Increasing collaboration and business partnership via incubator programs between engineering schools and the private sector will help to develop an innovative ecosystem at reduced cost. At the public level, we recommend increasing the seven-year horizon budget for 2028-2034 by at least 5% (over EUR100bn) while setting up a minimal investment provision dedicated to the robotics industry (5-10%).
- 4. Invest in workforce upskilling and education. A significant number of EU firms report difficulties in finding employees with the necessary skills to implement digital technologies, including robotics. This shortage is particularly acute in industrial sectors, where the lack of technical operators, robotics technicians and systems integrators stalls the deployment of advanced technologies on factory floors. Compounding the issue, the share of EU enterprises providing training to their employees declined from 71% in 2015 to just 67% in 2020. A comprehensive upskilling agenda is essential. Frontline workers need training to operate collaborative robots safely, interpret interface feedback and perform basic maintenance. Technicians should be proficient in robot programming, PLC logic, sensor alignment and diagnostics. At the strategic level, engineers must be capable of planning robotic workflows and integrating systems with enterprise software. Expanding vocational training with updated curricula, incentivizing companies to invest in employee reskilling and establishing a unified “Robot Skills Framework” across the EU are critical steps to align the workforce with the demands of modern (automated) manufacturing.
- 5. Streamline regulatory frameworks to foster innovation and adoption. The EU must balance its leadership in AI regulation with the need to foster innovation, particularly in robotics. While the AI Act, effective since August 2024, sets a harmonized legal framework by categorizing AI systems by risk, its strict rules risk slowing innovation and deterring investment, especially for SMEs. Robotics, closely linked to AI, faces added regulatory complexity due to overlapping safety rules and dynamic risk classifications. To address this, the EU should harmonize regulations, create “regulatory sandboxes” for testing, promote international collaboration and adopt adaptive, risk-based approaches that evolve with technology and support sector-specific innovation.