CHICAGO — The industrial automation sector is coming off a record year for robot shipments. But the market is likely to take a pause this year as customers optimize their operations with the factory and warehouse robots they've already bought. However, artificial intelligence is likely to boost sales of industrial robots in the near future, experts say.
Companies shipped a record 44,303 industrial robots to U.S. manufacturers last year, the International Federation of Robotics said. The IFR announced its latest statistics ahead of the Automate Show in Chicago, which opened Monday and runs through Thursday.
U.S. shipments of industrial robots rose 12% in 2023 with the automotive sector the biggest buyer. Automakers and car parts manufacturers accounted for 33% of all industrial robot installations in the U.S. last year.
The electrical and electronics sector was the second-largest buyer, the trade group said. It accounted for 12% of all industrial robots installed in the U.S. manufacturing industry in 2023.
Other sectors increasing installations of industrial robots last year included metal and machinery as well as plastic and chemical products.
Industrial Robot Orders Strengthening
But installations are likely to slow this year, said Jeff Burnstein, president of the Association for Advancing Automation, known as A3. That's because robot purchases declined 30% in North America last year after record orders in 2021 and 2022, Burnstein said.
"You would expect that if orders are down, shipments will be down (this year)," Burnstein told Investor's Business Daily.
However, the future is bright because the trends driving automation are still vital, Burnstein said. Those trends include worker shortages and the need for companies to improve the speed and efficiency of their operations.
"We're already seeing a strengthening of orders," he said. "So we expect the second half of this year to be pretty good."
AI In Focus At Automate Show
At the Automate conference, more than 800 exhibitors are showing off automation technologies ranging from robotic arms and conveyors to vision and motion control systems. And artificial intelligence is playing an increasing role in those products and systems. A3 produces the Automate conference.
Publicly traded companies exhibiting at Automate include ABB, AMD, Cognex, Fanuc, Rockwell Automation, Siemens, Teledyne, Teradyne and Zebra Technologies.
"In general, AI is making the robots smarter and able to do more tasks — whether it's picking something or packaging something," Burnstein said. "That functionality, combined with advances in machine vision and motion control, is going to enable robots to do a better job in what they currently do and take on new tasks."
Nvidia Is Supporting Industrial Robots
AI chipmaker Nvidia is providing software tools to advance the capabilities of industrial robots, Gerard Andrews, director of product marketing for robotics at Nvidia, said in a panel discussion at Automate.
"One of the areas that we're really excited about — and everyone in the automation space should be excited about — is the emergence of the concept of a foundational model," Andrews said.
Nvidia has created a suite of foundational models for robotic arms called Nvidia Isaac Manipulator. That model was trained on massive data sets so robots can handle tasks like assembly, sorting and machine tending, he said.
Investment Opportunities In Factory Automation
The growth of industrial robots is something investors should consider, says Taylor Krystkowiak, vice president and investment strategist at Themes ETFs. His firm manages the Themes Robotics & Automation ETF.
"As the capabilities of artificial intelligence continue to expand exponentially, we expect to see a commensurate expansion in the capabilities of automation and robotics that can execute ever more complicated tasks," Krystkowiak told IBD.
To be included in the BOTT exchange traded fund, stocks must have a positive total return over the preceding 12 months, he said. Holdings span old-guard companies like Lincoln Electric to newly public firms such as Symbotic.
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