The North American economy experienced a setback in 2023 as companies scaled back their investments in robots, with orders plummeting by a third compared to the previous year. The decline, the most significant in percentage terms since 2006, reflects concerns about a cooling economy and higher interest rates, which have made it more challenging for businesses to justify purchasing advanced automation technology.
According to data from the Association for Advancing Automation (A3), North American companies acquired 31,159 robots in 2023, marking a sharp 30% decrease from the previous year. This downturn, the largest in net units ever recorded, was particularly pronounced in automotive-related industries, which account for approximately half of the robot market, as well as in sectors like food and metals manufacturing.
Jeff Burnstein, president of A3, attributed the decline in robot orders to economic uncertainties, stating, "When the economy isn’t great, it’s easier to delay purchases." The fourth quarter of 2023 saw a further 8% drop in orders compared to the same period a year earlier, reflecting ongoing apprehensions among businesses.
Despite the overall decline in robot orders, some companies have announced initiatives to develop more advanced robotics technology. Robotics startup Figure recently partnered with Germany's BMW to deploy humanoid robots in the carmaker's South Carolina factory, while electric vehicle manufacturer Tesla is also working on a humanoid robot project. However, for many robot makers, selling existing machines has been challenging due to concerns about a softening economy and excess inventories accumulated during the COVID-19 pandemic.
Universal Robots, a Danish manufacturer of small, flexible robots, reported a 7% decline in revenue in 2023, with its president, Kim Povlsen, citing a "difficult economic and business environment" for many of the company's core customers. The decline in robot orders underscores the impact of economic uncertainties on investment decisions and highlights the challenges faced by manufacturers in navigating market fluctuations and changing consumer demands.
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