Amazon (NASDAQ: AMZN) is growing its fleet of robots in its warehouses to meet increased demand for expedited delivery as it faces pressure to cut costs.
The use of robots in the e-commerce giant’s warehouses is not new, the company acquired the robotics firm Kiva Systems for $775 million back in 2012, and currently has over 520,000 robotic drive units in facilities around the world. 75% of the 13 million packages the company delivers daily go through some form of automation.
This time, more than making its facilities more efficient, Amazon is looking to deploy more advanced robots to do the company’s most demanding and repetitive tasks — tasks that have triggered warehouse employees to organize unions and complain of injuries and exhaustion while working to meet Amazon’s ambitious same-day or next-day delivery promises.
Recode, which cites leaked internal 2021 research from Amazon, says that turnover rates in the company’s US warehouses are so high that it could run out of people to hire by 2024. The company has faced rumors of replacing its people with robots since it bought Kiva a decade ago, but it claims that the robots, instead of replacing its human workers, would make their lives easier. It also said it would retrain employees for higher-skilled jobs like mechatronics or software engineering.
It’s still humans who are responsible for selecting items off the shelves and packaging them for delivery, but the company’s newest robotic system, Sparrow, could soon start taking over at least the selecting part. The state-of-the-art robot, which was introduced last week, would “streamline the fulfillment process by moving individual products before they get packaged — a major technological advancement to support our employees.”
The Sparrow can identify about 65% of Amazon’s vast product inventory using computer vision and artificial intelligence. Its system can also detect if an item is damaged and discard it. It also has the ability to learn as it goes along,
and it’s unlikely that they will organize a union. The future looks bright for Sparrow, but maybe not so much for Amazon’s employees, especially since not everyone can be retrained for higher-skilled jobs.
The company claims that it has “created more than 1 million new robot-related jobs and 700 new job categories, including hardware and software engineers, as well as maintenance, technician, and operational positions.” But it was also planning on laying off 10,000 of its corporate workers this week.
Information for this briefing was found via Amazon, Vox, Axios, and the sources and companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.