Research and development

Strategic focus of research and development

The focus of research and development (R&D) is determined by the Strategy 2020. The KION Group pursues the primary objective of increasing the customer benefits in all price segments and sales regions and, by adhering to modular and platform strategies, offering high quality as well as high-performance products at competitive prices. This involves structuring R&D cost-effectively, reducing the complexity and diversity of products and shortening development times for new products. R&D essentially works on a cross-brand and cross-region basis, which ensures that research findings and technological know-how are shared across the Group. In addition, specialist product development teams working for the individual brand companies and regions develop customer-specific solutions.

In the Industrial Trucks & Services segment, the focus for premium products remains on total cost of ownership for customers. The objective is to minimise these costs, which include the purchase price, maintenance and repair costs and energy use, while complying with environmental targets and regulatory requirements in order to create highly efficient and competitive products for customers. In the volume and economy segments, the KION Group is establishing shared, cross-brand and cost-efficient platforms that enable low-cost production yet allow a strong degree of regional differentiation in the industrial trucks. The development centre in the southern Chinese city of Xiamen plays a particularly crucial role here.

The Supply Chain Solutions segment focuses, on the one hand, on refining its central software solution, Dematic iQ. This includes optimising the standard package and making customer-specific and region-specific modifications. On the other hand, the manual and automated supply chain solutions, including their components, are being constantly enhanced in order to achieve even faster processes, seamless integration of all production and logistics steps and even greater productivity while using the same amount of space.

Across the segments, brand companies, and regions, the KION Group has brought together the technical functions – research and development, procurement, quality and production processes – in the new CTO organisation in order to make its operating units more competitive. Uniform standards and global coordination of technical activities should enable the KION Group to offer more product variants with less effort and shorter development processes in future.

Key R&D figures

Total spending on research and development came to €147.1 million in 2016 (2015: €130.5 million), which equates to 2.6 per cent of revenue. Total R&D expenditure included €50.6 million in capitalised development costs (2015: €40.9 million). These expenses were offset by depreciation and amortisation of €57.0 million (2015: €53.3 million) (see note [17] in the notes to the consolidated financial statements).

The number of full-time jobs in R&D teams grew by 39.8 per cent to 1,477. A total of 451 R&D employees were added as a result of the Dematic and Retrotech acquisitions. > TABLE 036

The KION Group takes comprehensive measures to protect the products it develops against imitations and pursues a specific patent strategy. In 2016, the KION companies (including Dematic) registered a total of 93 patents (2015: 70). As at 31 December 2016, the companies of the KION Group held a total of 2,689 patent applications and issued patents (31 December 2015: 1,641 patent applications and issued patents). The marked increase is predominantly attributable to the first-time consolidation of Dematic.

Focus of R&D in 2016

Automation and connectivity

As a result of acquiring Dematic, Egemin and Retrotech, the KION Group offers the full spectrum of solutions for Intralogistics 4.0. These range from intelligent industrial trucks and fleet management solutions (Industrial Trucks & Services segment) to fully integrated, automated intralogistics systems (Supply Chain Solutions segment), in which self-driving trucks can be included as a component. The KION Group has also strengthened its CTO organisation with the R&D teams from Dematic and Egemin, thereby laying the foundations for success in a digital future and building on a whole host of product innovations in industrial trucks and supply chain solutions.

Industrial Trucks & Services

In 2016, STILL launched the first self-driving order picker, the iGo neo CX 20, on the market. The truck interacts with its operator and automatically follows him or her during the picking process. This can mean time savings of up to 30 per cent and a faster pick rate because the operator does not have to keep getting in and out of the truck. In addition, STILL unveiled the LiftRunner tugger train system, an automated forklift-free solution for on-site transporting materials.

Linde Material Handling added further models to its innovative robotics series, Linde-MATIC. In the medium term, Linde is aiming for all of the major product series to include an automated version.

The KION premium brands also continued to enhance their fleet management solutions. STILL introduced the new ‘neXXt fleet’ software, which intelligently merges data sets from different applications and areas so that customers can analyse their fleets accurately and comprehensively. The tool comprises a variety of web applications (apps) that can be accessed easily and conveniently from anywhere. In the medium term, STILL neXXt fleet will replace the STILLReport and STILL FleetManager applications.

LMH added the ‘pre-op check’ app to its ‘connect:’ fleet management system. A smartphone or tablet can now be very easily used to carry out the check that is required each time before a truck is used, as stipulated by the rules of the DGUV (German Social Accident Insurance organisation). In addition, LMH developed a new localisation technology that pinpoints the location of trucks and transport containers to within centimetres in real time. In the service business, LMH tested a mobile service manager app that sends requests, together with the truck’s QR code and a photo of the defective function, directly to the LMH service organisation.

Supply Chain Solutions

Dematic has, on the one hand, further enhanced its Multishuttle storage systems. The flexible and scalable Dematic Multishuttle 2 can significantly increase speed, accuracy and throughput in warehouses, production plants or distribution centers. The ergonomically optimized high performance order picking station RapidPick, with its revolutionary delivery system and fully automated feeding, allows for rates of 1.000 order lines respectively 1.400 picks per hour. A newly introduced modular sorting system increases performance for numerous applications in production and distribution. The enhanced RapidStore UL 1200-1 for the automation of pallet warehouses was particularly developed to modify previously manual processes under difficult spatial conditions.

Dematic’s automated guided vehicle (AGV) systems have been fully updated: in the past three years, the automated very narrow aisle trucks (VNAs) and the Flexfork 900, 1600 and 2500 counterbalance trucks have been completely redesigned and switched over to the FlexTruck universal mobile platform. The new FlexTruck can include a robot arm, pallet lifter or conveyor, enabling it to pick the correct units from a pallet containing a single type of item in order to load up a stable, mixed-order pallet. This new Dematic model series also comprises several modular, interchangeable components, such as cable harnesses and lithium-ion/hydrogen fuel cell options, as well as all of the new reflector-less navigation features.

Egemin Automation launched the E’tow^® Easy Loop, a new standardised in-floor chain conveyor system that can be delivered and installed particularly quickly thanks to its predefined components. The supply chain solution’s automatic chain lubrication and self-cleaning capability enable it to run continuously with virtually no maintenance, making it particularly appealing to logistics service providers.

Software development

The KION Group’s software expertise was strengthened considerably by the acquisition of Dematic as well as the related implementation of agile structures and strategic research partnerships for visualising and simulating supply chain solutions. The Dematic iQ and Dematic iQ Analytics software offers customers in the warehousing and distribution industry a host of functions for planning, optimising and executing orders plus comprehensive insights into the data that they collect. This enables them to automate their facilities efficiently, regardless of whether they are automating individual process steps for the first time or already have extensive experience of automation. Dematic iQ solutions are developed and thoroughly tested by highly qualified, dedicated R&D software development teams; new functions and releases usually come onto the market several times a year. The solutions are then configured, adapted and optimised for the individual products by equally experienced teams of software engineers. This ensures that every customer receives a bespoke solution that is tailored specifically to their automation requirements. The new Dematic iQ 2.3 release, for example, offers even faster picking, and versions of it for different customer segments have been successfully implemented. The on-demand fulfilment function enables urgent orders to be processed as a matter of priority at the nearest picking station.

Drive technology

The development of new drive technologies in the Industrial Trucks & Services segment is focused on lithium-ion batteries. STILL and Linde are using technology developed by the CTO Organisation in order to establish a lithium-ion standard for various electric forklift trucks and warehouse trucks and to gain a competitive edge in this important future market.

In 2016, Linde and STILL unveiled the first counterbalance trucks with lithium-ion batteries. Both manufacturers already have a number of li-ion warehouse technology models and tow tractors in their portfolios. The first Linde trucks with lithium-ion technology in the 1.4 – 1.8 tonne load capacity range went on sale in November 2016. STILL intends to offer lithium-ion batteries in 90 per cent of its trucks by the end of 2017.

The focus of development work at Baoli was the upgrading of its trucks fitted with diesel engines, which must meet the new China 3 emissions standard but also remain very affordable. In parallel, Baoli is working on new electric counterbalance trucks and warehouse trucks in order to expand these product lines.

Linde added new IC trucks in the 5 – 8 tonne load capacity range to its EVO series. The new trucks consume up to 20 per cent less fuel than their predecessors and feature extensive exhaust aftertreatment.

Modular and platform strategy

The KION Group is establishing shared, cross-brand platforms for product development and production that are geared to the volume and economy segments. The platforms enable the industrial trucks to be adapted to different regions cost-efficiently. Development for the volume and economy segments is managed from China, where around one third of the R&D staff are based.

The premium brands, Linde and STILL, have shared platforms for the Asia-Pacific and Americas regions, whereas their products for western Europe are developed using different platforms in order to maintain the defining characteristics of the brands.

All platforms are part of a global module strategy that enables products to be developed more cost-effectively and at a higher quality because of the growing number of common parts. The Group is therefore able to achieve high levels of synergy even in western Europe with its different platforms. Wherever possible, local suppliers are used for regional product features.