Hyundai is buying an 80% stake in Boston Dynamics in a deal that values the robot maker at $1.1 billion,

the South Korean automaker said Friday.

Analysts say Hyundai can leverage robot technology to expand automation at car factories and design

autonomous vehicles like self-driving cars, drones, and delivery robots.

Boston Dynamics' viral robot dog Spot, which can even climb stairs, has been used to evaluate

coronavirus patients in Boston, herd sheep in New Zealand, and give social distancing reminders in

Singapore.

Softbank sold the robot firm to Hyundai, marking its latest pullback from operating businesses as it

focuses on investing instead. Hyundai has agreed to buy an 80% stake in robot maker Boston Dynamics

from SoftBank, the South Korean automaker said Friday. The deal values the robot firm at $1.1 billion,

Hyundai said, suggesting it offered $880 million for the 80% stake. Boston Dynamics is best known for

its robot dog, Spot, which went viral.

Hyundai can leverage robot technology to expand automation at its unionized car factories, as well as

design autonomous vehicles like self-driving cars, drones, and delivery robots, analysts said.

The new stake comes after the newly promoted Hyundai Motor Group chairman, Euisun Chung,

pledged to reduce reliance on traditional car manufacturing, saying car-making would only make up

half of the company's future business. Urban air mobility would account for 30%, followed by robotics

at 20%. Chung will own a 20% stake in Boston Dynamics, while Hyundai Motor and its affiliates,

Hyundai Mobis and Hyundai Glovis, will hold a combined 60% stake.

"The transaction will unite capabilities of Hyundai Motor Group and Boston Dynamics to spearhead

innovation in future mobility," Chung said in a statement. Boston Dynamics' robot dog keeps hitting

the headlines. Boston Dynamics, which was spun out from the Massachusetts Institute of Technology

in 1992, was bought by Google in 2013 and sold to SoftBank in 2017.

The company's products include Spot, a four-legged dog-like robot that can climb stairs which has

gained enormous media attention. Spot became available to US customers for $74,500 in June, and

was expanded to Canada and the EU in September. The company suggests several uses for the dog-

like robot: "Inspect dangerous, inaccessible, and remote environments, automate data collection on

your site, carry payloads on unstructured or unknown terrain."

Clients include Ford, which leased two Spot robots in July as part of a pilot program. Spot has also

been used to evaluate coronavirus patients in Boston, herd sheep in New Zealand, and give social

distancing reminders in Singapore. "Hyundai needs to prove that Boston Dynamics can be

commercially successful and is capable of competing with cheaper Chinese rivals," said Koh Tae-bong,

an analyst at Hi Investment & Securities.

'Automakers are in an innovation race'

Last year, Ford said it was partnering with walking robot maker Agility Robotics as it designs a planned

fleet of self-driving delivery vans that will drop packages at the doorsteps of people's homes. The deal

is SoftBank's latest pullback from operating businesses as its CEO, Masayoshi Son, focuses on investing.

It also marks the fading of SoftBank's robotics ambitions, which were talked up by Son, and leaves the

group's own rump robotics business, which includes humanoid robot Pepper, looking increasingly

isolated.

For Hyundai, this is the latest in a flurry of deals under Chung, who pledged to transform the

automaker into a mobility provider, amid threats from electric carmaker Tesla and tech firms with

ride-sharing and self-driving technologies. "Automakers are in an innovation race. Hyundai is a

latecomer to the race, and it seems that they want to showcase that they can do it, rather than trying

to generate money from the robot business," mobility consultant Cha Doo-won said.

Hyundai has developed a wearable robot to reduce fatigue for factory workers and ran pilot programs

at its US plants. In January, Hyundai announced it had partnered with Uber to develop electric air taxis,

but the US firm said this week it would sell its loss-making flying taxi unit to Joby Aviation, an electric

passenger aircraft developer.

Source: GRACE DEAN,REUTERSDEC 12, 2020, 21:50 IST

https://www.businessinsider.in/tech/news/hyundai-has-bought-robot-maker-boston-dynamics-from-softbank-in-a-1-1-billiondeal/articleshow/79698379.cms

Based on the article above, answer the following questions:

1. Is Hyundai falls under time based competition industry? Support your answer with

justification by quoting an example from the article. (5 marks)

2. Describe the operations strategy of Hyundai. Support your answer with relevant knowledge

that we have learned. (15 marks)

3. "Hyundai has developed a wearable robot to reduce fatigue for factory workers..."

Which operations management decision best describe the above? Explain. (5 marks)

4. From operations management perspective, what can be done by Hyundai to maintain the

capability of their robot products? Explain why it is important to maintain the capability.

(15 marks)

5. Explain the difference between Softbank and Boston Dynamics. (5 marks)

6. In your opinion, do you think that it was a wise decision to sell off Softbank? Justify your

answer with reasons.