Vorwerk Group, a corporate group that owns a range of household appliance companies, has announced that it will be shutting down Neato Robotics, a developer of robotic vacuum cleaners.
The robotic vacuum company was founded in 2005 by Stanford University graduates and emerged as a key competitor to iRobot’s Roomba series.
Stefan Watzinger, a spokesperson for Vorwerk Group, told TechHive that Neato is “now being closed down despite lots of restructuring efforts,” based on the fact that it had “not achieved its self-defined economic goals for several years now.”
Watzinger added that Vorwerk intends to use Neato’s 14-person team in Milan to “ensure the security of the infrastructure of Neato’s cloud services for at least five years,” while spare parts and repair service will also be “guaranteed for at least five years.”
Since 2017, the corporate group has had total ownership of Neato Robotics. In a company statement, Vorwerk cited inability to achieve economic goals, especially in the USA, as a key motivation for the decision.
The announcement came as part of its wider corporate strategy development. It will now reportedly be focusing on developing growth by withdrawing from non-profitable market segments.
However, the company did also announce plans to ‘further expand its investments in the area of vacuum cleaner robotics and to strengthen the robotics competence within the group’.
Neato’s robot vacuums are equipped with SLAM technology with lidar to map, navigate and clean. By bypassing camera-based technology, the machine is designed to clean even in the dark.
Some other key elements of Vorwerk’s strategy announcement included a renewed focus on brands such as Kobold and Thermomix and further developing the group portfolio.
To achieve this, Vorwerk has developed a robotics competency centre at the Wuppertal Laaken site, wherein 50 developers and engineers of robotic systems will work on new group projects.
With this step, the group hopes to strengthen its commitment to Germany as a location to expand its position in the vacuum cleaner robotics market.