Industrial Automation Changing New Standards for Factory Location

Factory location decision criteria are fundamentally changing. CBRE analyzes that AI-optimized facilities now receive rental premiums over traditional factories. With global IoT devices exceeding 41.6 billion in 2025, factory digitization has become an irreversible trend.

Traditional factory location criteria were labor, land costs, and transportation. But as automation progresses, new criteria emerge: First, stable power supply (surging power demand for automation systems). Second, high-speed network infrastructure (IoT and AI data transmission). Third, skilled technical personnel (automation equipment operation and maintenance).

Reduced labor dependency makes 'stable infrastructure' more important than 'cheap labor.' This becomes a factor mitigating capital region concentration. Automated factories don't necessarily need to be in population-dense areas since they don't require massive labor forces.

Gyeongsangbuk-do industrial complexes may actually benefit from this change. Stable power near KHNP nuclear plants, high-speed networks from Gyeongbu Expressway fiber backbone, and technical workforce supply from POSTECH and Handong University meet new location criteria for automated factories.

Logistics automation is also developing rapidly. Introduction of autonomous forklifts, Automated Storage and Retrieval Systems (AS/RS), and AI logistics optimization changes logistics center location criteria. Large flat sites and stable power became key, which Gyeongbuk industrial complexes' spacious lots satisfy well.

When building automated factories, additional considerations from permit perspectives include: confirming power input capacity, network infrastructure construction permits, and safety certification for robots and automation equipment. Linking with government smart factory support programs can significantly reduce automation investment costs.