Behind the Slowdown in Robot Orders

Given all the interest in robots we’ve been seeing over the past decade, a recent report from the Association for Advancing Automation (A3) noting a decline in the North American robotics market didn’t come as too much of a surprise. The A3 report showed a decline in both units ordered and revenues, with unit orders declining nearly 8% and revenues down nearly 7% during the first half of 2024 compared to the same period in 2023. 

In its report, A3 pointed to economic headwinds such as inflation and rising borrowing costs as being principal reasons for the downturn. But I would add a couple more factors to this. 

One of these I believe has been election uncertainty. For most of my life, the general view of most economists has been that it didn’t really matter much who was president when it came to the markets or general U.S. economic performance. And without getting bogged down in certain analyses of Bureau of Labor Statistics or GDP data or market performance that tend to show it has made a difference—at least since World War Two—it’s clear that political tensions have risen to the degree that the general political normalcy those of us over the age of 45 or 50 have experienced for much of our lives has changed dramatically. And I believe this change, while not necessarily impacting long-term economic performance, most certainly influences near-term decision-making, especially in an election year like 2024. And I think we’re seeing this now, not just in its effect on the robot market, but in the recent performance of the manufacturing sector overall. 

Another factor that’s been impacting the robot market in 2024 is the natural slowdown tendency that follows a run-up in buying. The robot market has seen huge growth over the past several years, so it’s expected that we would see some easing. After all, what goes up must come down, with the exception, of course, of some suspect compound annual growth predictions I see from some industry analyst groups.

One issue potentially contributing to this natural slowdown after a big buying surge was pointed out in a podcast discussion I had with Ira Moskowitz of the Advanced Robotics for Manufacturing Institute. In that discussion, Ira noted that he has seen several challenges with robot implementations at small and medium manufacturers, which make up the bulk of manufacturing operations in the U.S. He said most of these manufacturers often don’t have the technical staff needed to fully support robot implementations. As a result, one of the most common things he’s seen in these smaller manufacturing facilities is a robot arm sitting in the corner because the manufacturer thought they needed it but didn’t have the resources to really put it to good use or maintain it.

Where robot buying is up and down

While overall robot sales decreased in the first half of 2024, A3 also pointed out that this robot buying decline was not an across-the-board issue. In fact, industries such as food, consumer packaged goods and life sciences were the main industries driving robot sales in early 2024. This too make sense considering that the CPG industries have lagged behind other manufacturing industries, such as automotive and electronics, when it came to the adoption of robots in their production operations.

According to A3, robot orders from food and consumer goods companies rose by nearly 86% and revenues increased by 56% in the first half of 2024. And the life sciences industry saw a nearly 48% increase in robot orders contributing to a nearly 87% increase in revenues from this industry. 

Two recent cases in point about the growing use of robots in the food industry can be seen in Automation World’s coverage of Amy’s Kitchen’s use of Chef Robotics technology and El Pinto Foods use of robots to increase its packaging efficiency.

And while the automotive industry’s robot orders remained positive with a 14% increase in the first half of 2024, it was in the semiconductor and electronics industry that the biggest hit occurred, with robot orders falling by 40%.

Robot technology keeps advancing

Again, I’ll contend that this drop in robot orders is more of a temporary reflection of several factors impacting the market than it is any kind of negative reflection on robot use or their capabilities in manufacturing in general. After all, the advances we’ve seen in robot technologies over the past decade are just a start to what we’ll see in coming years.

Consider what we’ve seen introduced in just the past several weeks:

• Universal Robots is now delivering a 5 kilogram boost in payload capacity to its UR20 and UR30 robots via a software update.
• Olis Robotics has added new remote access capabilities that enables it to not just assess robot operations remotely, but monitor, diagnose and debug entire robot cells remotely. With this software, users can monitor and set alerts for pre-defined runtime parameters through the PLC, including I/Os, registers and custom tags. Olis Robotics says this real-time access to PLC data basically closes the loop on video-based diagnostics for industrial automation systems using robots.
• Vention, the company behind the cloud-based Manufacturing Automation Platform to enable small and mid-sized manufacturers to more easily automate production operations, is now working with ABB Robotics to make the ABB GoFa collaborative robot family compatible with Vention’s platform. Learn more about this partnership.

Avoiding problems with robots

The bottom line here is that, if you’re looking into applying robots in your production operations, don’t let news of this downturn impact your decision. Instead, be sure to approach it as Ira Moskowitz from the Advanced Robotics for Manufacturing Institute advises to ensure you don’t wind up with a robot arm sitting in the corner of your facility. 

He said manufacturers should first conduct an engineering analysis of the target production line to first verify that a robot is actually needed there. Next, make sure you understand how the robot will interact with the rest of the line. Ira said that a robot can, of course, be used to automate nearly any step that was previously done by a human, but it could also disrupt the entire way that operation functions. Ira advised that you really have to think about how you would reengineer the line so that the robot can function efficiently and enable the rest of your processes to perform at the level you want. 

Original Article: https://www.automationworld.com/factory/robotics/article/55239498/behind-the-slowdown-in-robot-orders