How Automation Meets Manufacturing Reshoring Imperatives

Autonomous mobile robots (AMRs) impact a wide range of applications.

Contributed by: Mobile Industrial Robots (MiR)

Defining workflow areas relieves workers of material transport activities so that they can do more valuable tasks. Image courtesy of MiR.

One thing U.S. manufacturers learned from COVID-19 and its aftermath is that they need more control over business risks. Even after the pandemic’s impact, the combination of rising wages in China and increasing productivity in the U.S. has reduced the labor cost gap between the two countries to just 4%, according to an analysis[1] by U.K. consulting firm Oxford Economics. And while shipping costs have stabilized somewhat, geopolitical instabilities present new risks for businesses that depend on offshore components or production.

Reshoring to the U.S. from Asia — or nearshoring to manufacturing partners in Mexico or Latin America — has become increasingly helpful to avoiding risks and reducing costs and delivery times. In a recent Deloitte[2] survey, 62% of manufacturing leaders in the U.S. and Europe with annual revenues of over $500 million have already begun reshoring or nearshoring. In an analysis of S&P 500 earnings call transcripts, Bank of America[3] stated that mentions of reshoring were up 128% in the first quarter of 2023 versus the first quarter of 2022.

Many manufacturers also are looking to take advantage of new government programs and incentives that support onshore investments. The Reshoring Initiative’s 2022 Data Report[4] states that “new investments in U.S. manufacturing by domestic and foreign companies surged,” with a record-breaking 364,000 new jobs in 2022. That increased 11% in the first quarter of 2023 over 2022, which — if that rate continues — would result in over 400,000 new jobs in 2023.

The challenge for manufacturers with reshoring initiatives, however, is the continued labor shortage that makes filling those new jobs problematic. Businesses face historic low unemployment rates across most of the U.S., combined with an aging workforce that is retiring at record rates and a general lack of interest in manufacturing jobs by younger workers.

AUTOMATION HELPS ADDRESS LABOR SHORTAGES

For manufacturers of nearly any size, automation is proving to be the enabling factor to address labor shortages while they reap the advantages of reshoring. Lower automation costs and more financial options such as leasing mean many manufacturers continue to invest in equipment to offload the dirty, dull, and dangerous jobs they can’t otherwise fill. At the same time, manufacturers can shift to hiring (and retaining) workers for more attractive and valuable jobs that help them improve quality, productivity, and overall competitiveness. Flexible, cost-effective collaborative robots such as cobot arms and autonomous mobile robots (AMR) support business growth while reducing dependency on low-skilled manual labor.

DENSO is a global manufacturer that uses AMRs from Mobile Industrial Robots (MiR) in multiple locations throughout the Asia, Europe and the U.S., including its Athens, Tennessee, plant that is located near its Tier One automotive customers. A pilot program between the warehouse and production areas delivered results within six months, freeing six workers from pushing carts up to 12 miles per day and allowing them to move to value-added roles. The project was quickly expanded to bring components directly to line-side production for just-in-time efficiencies and to support transporting goods such as maintenance supplies and spare parts.

“Automating these repetitive and strenuous tasks with new technologies that make jobs easier helped us retain our existing labor force,” said TIE engineer Travis Olinger. “We had plenty of open jobs for value-added activities within the production environment. We wanted to pay people to make parts for us that make us money, and not pay them to move parts that cost us money.”

AUTOMATING MATERIAL TRANSPORT

While high-mix, low-volume manufacturing can still be a challenge for production robot arms, automating material transport with AMRs offers immediate impact in a wide range of applications. Skilled workers can focus on profitable activities rather than being paid to walk miles per day moving raw materials, subassemblies, production waste, and finished goods from one area of the plant to another. For larger manufacturers, who are often already highly automated in production processes, mobile robots represent a “last mile” opportunity to further optimize labor and production efficiencies.

Automation also supports nearshoring to manufacturing partners in other parts of North America. Mexico currently ranks third in the world for robot implementations, which is helping manufacturers there maintain competitiveness. The Mexico Business Journal[5] states that, “Coupled with lower overhead expenses and operational costs, logistics, duties and tariffs, nearshoring/reshoring manufacturing operations from China to Mexico could save in excess of 30% Total Cost of Operation (TCO) hourly wrap rates.”

AMRs CAN JUMPSTART RESHORING INITIATIVES

An MiR250 with an Interrol conveyor module enters an elevator. Image courtesy of MiR.

Unlike conveyor systems or automated guided vehicles that require extensive, costly, and fixed infrastructure, AMRs use integrated sensors and safety features to maneuver safely and autonomously around workers and other equipment. Intuitive navigation and fleet management software allows manufacturers to easily update robot “missions” and routes, and adapt to new production requirements. That means that new automation initiatives can focus on one or two areas to begin with, and then expand the fleet over time as the robots pay for themselves through their return on investment (ROI).

Implementing AMRs starts by defining workflow areas where workers can be relieved from material transport activities to more valuable tasks:

Inbound logistics. Limit fork truck traffic to the controlled environment of the receiving dock and use safer, more-efficient AMRs for repetitive and long-distance transport of pallets or goods to any internal destination.

Raw material storage. Within and from the warehouse, customizable AMRs can move pallets, receive material from high-reach equipment, and deliver raw material for production binning.

Production and assembly lines. AMRs move safely and efficiently through even the busiest manufacturing environments, following regular “bus routes” or responding to on-call systems. AMR software can also be integrated with enterprise resource planning (ERP), manufacturing execution systems (MES), and warehouse management systems (WMS) to automatically deliver materials lineside to meet just-in-time and agile processes.

Finished goods, waste, and outbound logistics. With regular autonomous pick-up and delivery, materials don’t stack up in manufacturing environments. Regular samples of work in progress can be delivered to quality inspectors to address issues quickly, reduce scrap, and improve quality and yield. AMRs can transport large finished products that can’t be handled by conveyors and could cause lifting injuries, and can also remove empty pallets and other waste from the manufacturing floor and deliver it to disposal areas.

While ROI varies widely depending on individual situations, many AMR deployments pay for themselves within a year or two, giving manufacturers the ongoing benefits of reduced business risk and improved productivity, despite labor challenges. A certified integrator can help define the best AMR applications, plan an effective approach, manage risk assessments and train workers. WMHS

MiR manufactures AMRs that can quickly, easily and cost-effectively automate internal logistics and optimize material handling. Learn more at https://www.mobile-industrial-robots.com

[1] https://tinyurl.com/manufacturing-labor-news

[2] https://www2.deloitte.com/us/en/insights/focus/transportation/future-of-transport-industry.html

[3] https://tinyurl.com/cnbcreshoring

[4] https://reshorenow.org/content/pdf/2022_Data_Report.pdf

[5] https://tinyurl.com/mexicobusinessnews