Cailian News, October 8th (Editor Xiaoxiang) In American factories, there seems to be fewer and fewer jobs left for new robots...

Many company executives express that as production lines and workshop business slow down, manufacturers are reducing their purchases of automation equipment. At the same time, in the American labor market, more human workers are queuing up again to wait for employment.

According to the data from the Association for Advancing Automation (A3) in the United States, the number of robot orders in North American factories last year decreased by nearly one-third compared to the record level in 2022. The order volume in the first six months of this year further declined - in the first half of 2024, North American enterprises ordered a total of 15,705 robots, a 7.9% decrease compared to the previous year.

The association's data primarily focuses on industrial robots. Industrial robots are typically used for assembling parts or transporting heavy materials in production environments.

Cailian News reported several years ago, after the outbreak of the COVID-19 pandemic, many job positions in North American factories were difficult to fill due to labor shortages, prompting complaints of 'difficulty in recruitment.' To some extent, this situation drove American companies to introduce more innovative and efficient technological replacement solutions. Automation equipment attracted significant investments at that time. Supply chain bottlenecks further stimulated demand, especially when components and materials were in place, companies would try their best to speed up production.

For factory managers struggling to find workers willing to engage in repetitive tasks, industrial robots were once a coveted solution back then - they don't need rest and won't get injured or abruptly resign.

However, everything seems to have changed since last year...

Kawasaki Robotics, a subsidiary of Kawasaki Heavy Industries, produces automotive industry and warehouse automation production equipment. Paul Marcovecchio, General Manager of General Industry at the company's USA headquarters, stated that when companies buy robots out of fear and concern, they often end up purchasing too many. But now, they no longer need to worry about this.

Why are industrial robots not popular anymore?

Behind the unpopularity of robots, an obvious reason is undoubtedly the lack of demand.

According to data from the US government, industrial production in the US in August was barely flat compared to the same period last year. Production of appliances, heavy trucks, machinery, and oil well equipment all declined.

Survey data released by the Institute for Supply Management on October 1st shows that in September, US manufacturing activity has shrunk for the sixth consecutive month, with demand remaining weak and new export orders significantly reduced. The institute's survey director, Timothy Fiore, stated in a declaration that demand remains weak and output is decreasing. Due to the Fed's monetary tightening policy, companies are reluctant to invest in capital and inventory. "The uncertainty of the elections" is also a factor.

The Association for Advancing Automation in the US stated that the automotive industry was once the largest user of industrial robots in North America, but robot orders in the second quarter of the industry have declined by 20% compared to the same period last year. Automotive industry robots accounted for 46% of all robot orders in the quarter, much lower than the nearly 60% in the same period in 2022.

Auto manufacturers and their suppliers had been buying more robots to increase factory automation rates and boost electric vehicle production. However, due to recent disappointing sales, US automakers have put the brakes on the production of some new electric car models.

Scott Marsic, Product Manager of the Robotics Division at Epson, stated that people were once very excited about the prospects of electric vehicles, but demand has since changed. The company focuses on high-speed, precision robots used to manufacture electronic products and other small components.

There is also no shortage of workers.

In Cleveland, USA, manufacturing company Jergens produces components that enable robotic arms to pick up and secure parts in factories. The company's president, Jack Schron, said that while sales of (siasun robot&automation) in the aerospace & defense sector increased this year, their business in other markets performed averagely.

Schron also mentioned that some companies purchased a large number of robots during the labor shortage caused by the COVID-19 pandemic. However, they underestimated the maintenance and programming skills needed to deploy the robots for more complex tasks.

He said, 'The use of robots is a technical skill. The use of robots will not disappear, but it will indeed slow down.'

It is worth mentioning that in recent years, the growing interest of many companies in automation has made some American workers anxious. They believe that their jobs are threatened by robots, artificial intelligence, and other cutting-edge technologies. The most typical case happened this month - after reaching a temporary agreement on wages with port authorities last week and ending a worker strike, dockworkers continued negotiations on expanding the use of automation equipment and vehicles at ports along the East Coast and the Gulf of Mexico.

Many manufacturing executives have stated that although finding skilled workers such as mechanics is still difficult, reduced employee turnover and lower production volumes have decreased their need to purchase more robots. Census Bureau survey data compiled by Jason Miller, a supply chain management professor at Michigan State University, shows that only about 21% of manufacturers in the second quarter of this year believe that labor shortages are a comprehensive production obstacle, lower than 45% in the same period of 2022.

Many robot manufacturers have mentioned that customers are becoming more selective in their equipment purchases. High interest rates and lower production volumes mean that businesses take longer to recoup the investment in robots.

Austin, Texas-based Athena Manufacturing purchased seven robots in 2021 and 2022 when they could not find enough workers to meet the increasing demands for welding and cutting metal parts used in semiconductors, aerospace & defense, and nengyuanhangye industries. The company's CFO, John Newman, stated that since then, the company has only purchased one more robot because their production has decreased by 20% compared to 2022.

"Robots are still in use, but the frequency of use is not as high as it was during and after the pandemic," Newman pointed out.

Of course, in the long run, many industry professionals still believe that the appearance of more robots in factories will be the trend. Marsic of Epson Corporation predicts that with declining interest rates, the demand for robots will rebound, allowing manufacturers to use robots more cheaply. In terms of robots, companies are currently in a wait-and-see mode.