It may be possible to claim that industrial automation goes all the way back to the first assembly lines built by Henry Ford. However, the industrial robots that are ubiquitous today in the automotive manufacturing business may be more in line with what most people think of as industrial automation.

Modern robots used in auto factories are mostly used to weld together components of the body structure. They also use them to dispense adhesives, paint various components, and mount heavy pieces, such as dash panels into awkward places.

Today, many other manufacturing industries use robots in their factories. For example, the electronics industry uses industrial robots to pick up and place computer chips on its circuit boards.

The main participants in this portion of the automation MegaTrend are Sweden’s ABB (NYSE: ABB), Germany’s Kuka (FWB: KU2), and Japan’s Fanuc (TYO: 6954) and Yaskawa (TYO: 6506). The stock prices for all these companies are down since the start of the year, along with the general market. However, each is a leader in industrial robotics and likely to see strong future gains.

The Next Generation: Surgical Robots

More and more doctors are performing surgeries on humans laparoscopically. Rather than cutting big incisions, a narrow flexible tube with a small tool on the end, such as a camera or scissors, is fed in through a small incision and directed towards places in the patient that need repair, or where a biopsy is necessary. The advantages of laparoscopic surgery are many, including less pain for the patient, faster recovery time, and reduced scarring.

However, another advantage of laparoscopic surgery is that it lends itself well to being performed by robots. These robots aren’t fully automated. Rather a doctor sits at a control panel next to the operating table and guides the robot to perform the necessary surgical operations.

There’s also a screen that’s used in conjunction with a tomographic 3-D model of the patient’s organs to show the surgeon exactly where the robot is. The advantage is that surgical robots are far steadier than the hands of even the best surgeon, thus increasing surgical accuracy.

Twenty years ago, surgical robots were pure science fiction, like the one that repairs Luke Skywalker’s hand in the first Star Wars, but today they’re a reality and increasingly common in hospitals. They will continue to rapidly become more and more sophisticated and useful.

Development and deployment of surgical robots is led by Silicon Valley superstar Intuitive Surgical (NASDAQ: ISRG). The company’s stock price is also down about a third from its peak at the end of 2021. However, it should recover quickly. Today is a great time to get in at a discount if you’re a long-term investor.

On the Road and in the Air: Automated Vehicles

Autonomous and remote-controlled vehicles, both those that drive on the ground and fly in the air are very much part of the automation megatrend.

More and more, the world’s militaries are turning to arial drones to patrol airways, conduct reconnaissance missions, and carry-out bombing missions.  These are companies like AeroVironment (NASDAQ: AVAV) and Aurora Flight System (acquired by Boeing (NYSE: BA) in 2017).

Development of self-driving, autonomous cars is also part of the automation megatrend. It seems that research in this area has cooled-off in recent times. For example, Ford (NYSE:F) and Volkswagen recently shut down their joint development efforts.

However, Tesla (NASDAQ: TSLA), Nvidia (NASDAQ: NVDA), Alphabet (NASDAQ: GOOGL), and Microsoft (NASDAQ: MSFT) continue to work in this field, and they’re all MegaTrend stocks. Investment in any one of them is a good way to make money over the long-term in the automation megatrend.

Warehouse Robots

In line with industrial robots are warehouse robots. Big companies like Amazon (NASDAQ: AMZN) and Costco (NASDAQ: COST) have enormous fulfilment warehouses that employ thousands of warehouse robots alongside thousands of people. These robots are able to autonomously move inventory around the warehouses, load and unload them on and off of cargo trucks, and transport the inventory to locations in the warehouse where they can be mailed to customers.

Both of these two companies are MegaTrend favorites and offer terrific, safe, long-term growth potential.

Artificial Intelligence Is Coming

Artificial intelligence (AI) is a common thread that winds its way through all these components of automation. It promises to improve the performance and utility of all forms of automation.

Most of the companies listed above are involved with embedding intelligence into their automation products. Some examples of AI in robots include warehouse robots that learn their way around fulfillment centers, autonomous cars that learn to drive in traffic, and industrial robots that learn to safeguard their human co-workers.

The Automation Megatrend

Only a small subset of the types of automation are described here. It’s currently a $158 billion industry, and it’s expected to near $300 billion in the next five years.

There are many more types, such as household robots, self-guided ships, automated highway systems, and autonomous farming equipment, just to name a few. The level of automation experienced in our daily lives has been increasing for decades and will only continue to do so into the future, increasing at a faster and faster rate.

At the heart of automation is the fact that it’s reaching MegaTrend size quickly. That means, regardless of what the economy and markets are doing, this sector is a core technology that will continue to grow, even if global growth slows, and when that global growth heats up, you can be sure these stocks will be the key beneficiaries of this MegaTrend and others as well.

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