Robotech Stories: Warehouse automation and Amazon – a Prime example
- 21 August 2024 (3 min read)
Robotech continues to be a source of long-term growth opportunities, thanks to its diverse investment universe and ability to harness accelerating technological advances. These attributes provide significant flexibility – not only to capture new possibilities, but also to help address challenges attached to them. The cost and availability of labour is a key challenge facing businesses today. The cost of staffing factories and warehouses is rising, while the available workforce is shrinking. This is in part due to younger generations’ growing disinclination to apply for manual, repetitive jobs:
The concept of automation is not new to investors, and its potential for growth and enhanced scalability is expected to lead to greater efficiency, precision, and safety. These advantages may also help to strengthen the ability of industries to respond to the aforementioned challenges such as rising labour costs, shrinking skilled workforces, and ageing machinery.
Amazon has committed significant resources to help drive the future of warehouse automation by continuing to develop logistics robots. In 2023, the company made headlines for welcoming two new recruits, ‘Sequoia’ and ‘Digit’, as an example of the benefits of that automation can provide to both employees and customers of large-scale e-commerce solutions. The first comprises of a multi-function aid to workers as a pilot scheme in its Texas warehouse: Sequoia is able to streamline inventory management and order processing, speeding up deliveries, while its ergonomic console and robotic arm components reduce the amount of manual handling injury risk. Amazon expects this innovative automation solution to be able to identify and store inventory at their fulfilment centres up to 75% faster than today.
Meanwhile, Digit is a pioneering bipedal solution developed in partnership with Agility Robotics. Its greater range of movement and physical handling abilities are designed to expand the functions and dexterity of fulfilment automation devices, enabling them to better navigate warehouse spaces built for humans, and complete tasks requiring more complex movement and grasping skills. Such developments illustrate the potential of automation to take over a greater range of repetitive, manual handling operations, thus ‘freeing up’ warehouse workers for more complex tasks. Amazon first entered the robotic space in 2012, when it acquired Kiva Systems and their fleet of automated guided vehicles (AGVs). After more than a decade Amazon has now a long track record of adopting robotic solutions at scale, with around 750,000 already in operation. This is one of the main reasons why Amazon is the number one e-commerce player globally, being able to deliver millions of products daily with a next day delivery option. Its continued commitment to research and development is forecast to not only provide labour solutions and efficiencies, but also to create new roles and industries within the robotech field.
The evolution of warehouse automation illustrates just one of the range of examples where companies within the robotech investment universe possess both the agility and the technology to provide both opportunities and solutions to cross-sector modern, global industry and commerce.
Companies shown are for illustrative purposes only as of 21/08/2024. It does not constitute investment research or financial analysis relating to transactions in financial instruments, nor does it constitute an offer to buy or sell any investments, products or services, and should not be considered as solicitation or investment, legal or tax advice, a recommendation for an investment strategy or a personalised recommendation to buy or sell securities.
Disclaimer
This website is published by AXA Investment Managers Asia Limited (“AXA IM HK”), an entity licensed by the Securities and Futures Commission of Hong Kong (“SFC”), for general circulation and informational purposes only. It does not constitute investment research or financial analysis relating to transactions in financial instruments, nor does it constitute on the part of AXA Investment Managers or its affiliated companies an offer to buy, sell or enter into any transactions in respect of any investments, products or services, and should not be considered as solicitation or investment, legal, tax or any other advice, a recommendation for an investment strategy or a personalised recommendation to buy or sell securities under any applicable law or regulation. It has been prepared without taking into account the specific personal circumstances, investment objectives, financial situation, investment knowledge or particular needs of any particular person and may be subject to change at any time without notice. Offering may be made only on the basis of the information disclosed in the relevant offering documents. Please consult independent financial or other professional advisers if you are unsure about any information contained herein.
Due to its simplification, this publication is partial and opinions, estimates and forecasts herein are subjective and subject to change without notice. There is no guarantee such opinions, estimates and forecasts made will come to pass. Actual results of operations and achievements may differ materially. Data, figures, declarations, analysis, predictions and other information in this publication is provided based on our state of knowledge at the time of creation of this publication. Information herein may be obtained from sources believed to be reliable. AXA IM HK has reasonable belief that such information is accurate, complete and up-to-date. To the maximum extent permitted by law, AXA IM HK, its affiliates, directors, officers or employees take no responsibility for the data provided by third party, including the accuracy of such data. This material does not contain sufficient information to support an investment decision. References to companies (if any) are for illustrative purposes only and should not be viewed as investment recommendations or solicitations.
All investment involves risk, including the loss of capital. The value of investments and the income from them can fluctuate and that past performance is no guarantee of future returns, investors may not get back the amount originally invested. Investors should not make any investment decision based on this material alone.
Some of the services listed on this Website may not be available for offer to retail investors.
This Website has not been reviewed by the SFC. © 2024 AXA Investment Managers. All rights reserved.