75-80% of warehouses will be automated in the next decade: AutoStore CEO

Written By Warehouse Automation

AutoStore CEO and President Karl Johan Lier joins Yahoo Finance to discuss the company’s market debut in Oslo, growth acceleration of automation after the pandemic, and the effects of the chip shortage on the company.

Karl Karl Lier, CEO of Autostore.

Norwegian robotics company AutoStore appears to have wowed the Street in the lead up to its IPO. AutoStore said today it has priced its IPO at the top of its targeted range, valuing the company at about $12.4 billion. It's not hard to understand the investor enthusiasm. AutoStore is a major player in warehouse automation technology at a time where companies are aggressively growing online and need tech like this to compete.

Joining us for more on the company is AutoStore president and CEO Karl Lier. Karl, good to see you this morning here. Congrats on the debut. For those folks out there not familiar with what you do, what are some of the drivers of your business right now?

KARL LIER: Well, we are a robotics company in the automatic robotics business. So we be the ultimate [INAUDIBLE] among models. And we see after the pandemic that the growth in e-commerce really has accelerated this business, and we have seen very strong growth, really for many years. But after the pandemic, really the demand has increased very, very strongly.

- And Karl, it's Julie here. So talk to us about where the demand is coming from. It's kind of interesting to me that your technology is not even more widespread, given the growth we had already seen in e-commerce. Where is the demand coming from and what do you think is the growth path for your company and its technology?

KARL LIER: Well, we are only a source business, and this market is primarily a manual operation today. We say that 15% of the market is penetrated with automation. We believe that during the next decades, probably 75% to 80% of the warehouses will be automated, and that brings a market that will grow strongly for many decades to come.

And in addition, our product is very strongly linked with e-commerce. 70% of our customers are into e-commerce, so the growth, the secular growth drivers like e-commerce, changing trading patterns, et cetera is also accelerating our business.

- And Karl, one number that jumped off to me on the presentation that you all put out, $3.4 billion product pipeline, over 2000 projects in the works. How long does it take until you realize that amount of revenue?

KARL LIER: Well, we see that a lot of these, we say that slightly more than 10% will materialize during 12 months, for instance. And there will be some delays and a lot will take longer time. So we see, really, project lifetime so from three months to two to three years, I would say.

- Hey Karl, Brian Cheung here. This is a bit of a silly question, but obviously there's a shortage of auto parts out there. This is kind of in line with just the broad supply chain issues in many other industries as well. But does that affect your ability to source the parts that you use to build up your factories? Obviously with this IPO you're building up capital. I imagine you're using that for a growth strategy to maybe increase what you've got going on here. What does it take to put these robots in the infrastructure together, and is it hard to build that right now?

KARL LIER: Well, I would say that generally, I think all over the world there is challenges on the sourcing side. We have seen it this year primarily with longer lead times on aluminum, I would say. But we have been able to deliver the expected volumes and customer demand for 2021, and our increasing capacity for 2022 on the aluminum side.

Her står Karl Johan Lier med dei to ulike robotane – Red Line og Black Line – som susar rundt og hentar varer lagra i kassar som står tett i tett i ei aluminiumsramme. FOTO: Ellen Marie HagevikBilde 1 av 4

But they're all along a lead time, so customers need to order all the projects earlier to secure delivery at the right time. In addition, you have components where it is on location at the moment and in that connection we have been able to continue to deliver as expected during 2021. And we work hard every day to continue to deliver the growth also for going forward.

- How is the chip supply shortage impacting the business, Karl?

KARL LIER: Well, at the moment we have been able to deliver according to expectations. And we are working with the component sourcing all the time, really to secure deliveries. So as we see it now, we are on track to continue to deliver the growth for 2022.

- All right, we'll leave it there. AutoStore president and CEO Karl Lier. Congrats on the IPO. We look forward to staying in touch.

Jakob Hatteland raised over a billion last year

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