An individual works with robots at Procter & Gamble’s manufacturing facility in Tabler Station, West Virginia, U.S., May 28, 2021.
| Photo Credit: Reuters
North American firms ordered about a third fewer robots final 12 months as worries about a slowing economy and better rates of interest made it tougher to justify shopping for the superior machines, the primary hiccup in 5 years in what has been a regular development of the robotic invasion of the area’s workforce.
“When the economy isn’t great, it’s easier to delay purchases,” mentioned Jeff Burnstein, president of the Association for Advancing Automation, an business group that tracks robotic orders.
Companies purchased 31,159 robots in 2023, a drop of 30% over the 12 months earlier than, the biggest drop in proportion phrases since 2006 and largest drop ever in internet models, in line with the group, referred to as A3. The pullback occurred in automotive-related industries — which made up about half of the market final 12 months — in addition to different sectors similar to meals and metals manufacturing.
Orders in the fourth quarter hit 7,683, an 8% drop from the identical interval a 12 months earlier.
Slowing robotic orders got here whilst some firms introduced initiatives to develop extra superior variations of the machines. Robotics start-up Figure mentioned final month it cast a partnership with Germany’s BMW to deploy humanoid robots in the carmaker’s South Carolina manufacturing facility to tackle sure bodily duties. Electric-vehicle maker Tesla additionally has a humanoid robotic in improvement.
Softening economy
But for a lot of robotic makers, promoting present machines has been hampered by worries about a softening economy and the surplus inventories constructed up through the COVID-19 pandemic. Universal Robots, a Danish maker of small, versatile robots, not too long ago reported its income fell 7% final 12 months, to $304 million.
Universal’s President, Kim Povlsen, instructed buyers: “2023 was characterized by a difficult economic and business environment for many of our core customers with global industrial activity slowing in the first half of the year.”
Robot gross sales boomed through the COVID-19 pandemic — as producers scrambled to make use of the machines to churn out items amid a dire labour scarcity. Indeed, 2022 marked a report 12 months for orders, in line with A3’s information.
To be certain, robots are only one kind of kit firms want, and different gauges of spending have held up higher in the U.S. Orders for non-defence capital items, excluding plane — a measure intently watched by economists to trace tendencies in enterprise spending — rose 1.7% final 12 months, in line with the Commerce Department, suggesting that investments in extra primary varieties of tools remained near regular because the economy defied expectations of a sharper slowdown.
Dave Fox, President of CIM Systems Inc., a Noblesville, Indiana, firm referred to as an integrator that assembles robotic programs for purchasers, mentioned his enterprise began off sturdy final 12 months however then slumped.
“Several big projects got pushed into this year,” mentioned Mr. Fox. “There were definitely a few customers who brought up their concern about where the economy is headed. And interest rates probably didn’t help.” Mr. Fox estimates his enterprise quantity fell 30% in 2023, in contrast with the 12 months earlier than.
Mr. Fox mentioned some clients who delayed orders are actually asking for up to date quotes, which is a good signal for enterprise in the months forward. But he mentioned it’s too early to say whether or not enterprise will return to lofty pandemic ranges.
A3’s Burnstein mentioned most robotic producers he speaks with are optimistic that enterprise will decide up through the second half of this 12 months.
Mr. Burnstein mentioned the business has largely labored its method by means of the distortions brought on by the pandemic.
During the disaster, many firms put in additional orders for robots as a result of they fearful about receiving deliveries amid manufacturing delays and a breakdown in world provide chains. “There’s still this feeling that companies were buying in advance of their needs (in 2022),” mentioned Mr. Burnstein, “so a lot of companies now have inventory to work through before they order a lot of new robots again.”
Joe Gemma, chief income officer of Wauseon Machine, a programs integrator in Ohio, agreed there was a list glut that distorted the enterprise. “A lot of us were ordering extra inventory,” he mentioned. “Our customers were too.”
Mr. Gemma mentioned an ongoing scarcity of labour in the U.S. means the robotic enterprise will proceed to thrive. “I was at a plant recently that normally has 600 people working in production — and they have 140 open positions,” he mentioned. “Almost every place we go, there’s still a workforce challenge.”
