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U.S. factories are adding robots at a record pace this year as they deal with worker shortages and the need to increase productivity. And industrial automation stocks have risen amid the bounce in sales, including Rockwell Automation (ROK) and Teradyne (TER).
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During the first three quarters of 2021, North American companies ordered nearly 29,000 robot units valued at $1.48 billion, surpassing the previous nine-month record set in 2017, according to the Association for Advancing Automation, known as A3.
That puts 2021 on track to be the biggest year ever for industrial automation, A3 President Jeff Burnstein told Investor’s Business Daily.
“Labor shortages are driving the demand for automation,” Burnstein said. “They just can’t find people. It doesn’t matter if it’s a warehouse or a factory, they just can’t get anybody.”
Non-Automotive Customers Leading Charge
On a year-over-year basis, robot sales are up 37% in units sold and 35% in dollar value so far in 2021. This growth comes even as industrial automation companies face component shortages that are hindering their production.
In the first nine months of 2021, automotive-industry robot orders increased 20% year over year to 12,544 units ordered. Meanwhile, non-automotive orders outpaced this growth, expanding 53% to 16,355 units ordered.
Industries posting the fastest growth in robot purchases in the third quarter were metals, up 183% year over year, and food and consumer goods, up 40%.
“We see many current users expanding their applications of robotics and automation throughout their facilities while first-time robotics users are emerging in a wide range of industries such as automotive, agriculture, construction, electronics, food processing, life sciences, metalworking, warehousing and more,” Burnstein said.
A3’s data only counts robots with manipulator arms. So, it doesn’t include the many mobile robots used for shuttling inventory in warehouses and factories.
“We’re definitely undercounting,” Burnstein said.
Industrial Automation Stocks Breaking Out
Several industrial automation stocks have broken out of base patterns recently, according to IBD MarketSmith charts.
Lincoln Electric (LECO) stock broke out of a cup base at a buy point of 143.40 on Oct. 20. It notched an all-time high of 147.08 on Oct. 26.
Teradyne stock broke out of a 27-week consolidation pattern at a buy point of 139.38 on Nov. 1. In intraday trading on the stock market today, it hit a record high of 149.95.
Rockwell Automation stock broke out of a cup-with-handle base at a buy point of 320.74 on Nov. 1. It reached an all-time high of 345.83 on Nov. 5.
Allied Motion (AMOT) stock broke out of a 21-week consolidation at a buy point of 38.20 on Nov. 4. It hit a record high of 44.70 on Nov. 9.
Other industrial automation stocks are still in consolidation patterns, including ABB (ABB), Cognex (CGNX) and Emerson Electric (EMR).
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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