For anyone that watched the Terminator movie franchise and developed an overwhelming fear of robots – perhaps look away.
A new report from Betashares has shed light on the global robotics industry and its profound development.
An ideal ASX ETF for investors looking to target this developing market is the Betashares Global Robotics And Artificial Intelligence ETF (ASX: RBTZ).
Here are three reasons investors could benefit from long term growth through this fund.
A growing market
According to Hugh Lam, Investment Strategist at Betashares, globally, the robotic market is projected to reach US$111 billion by 2030.
This is being driven by persistent labour shortages, accelerating AI adoption, and better unit economics from increased competition.
Goldman Sachs forecasts the global humanoid robot market alone could reach US$38 billion by 2035. This is up more than sixfold from a previous projection of US$6 billion.
Real world application
According to Betashares, for much of the last decade, AI progress was largely software-driven.
However, advances in embodied AI are now enabling robots to operate in real-world environments. This is shifting application from research demos to commercial deployment.
Companies are already applying these capabilities across industries – from simulated factory design to physical automation.
At the same time, large-scale humanoid robot production is beginning to take shape.
For example, the demand for physical robotics is manifesting in areas of the economy where workflows are often considered monotonous or dangerous.
This includes high-energy power plants and logistics warehouses and manufacturing facilities.
Roughly 16,000 humanoid robots were installed globally by the end of 20253, with annual shipments forecast to reach 115,000 units by 20274 — a near-sevenfold increase in just two years.
Cheaper development
Not only is investment growing, and real world application materialising, but the cost of building a single humanoid robot has fallen dramatically.
From anywhere between US$150,000 and US$500,000 just a few years ago, manufacturing costs dropped approximately 40% between 2022 and 2023 alone, driven by cheaper components shared with mature electric vehicle supply chains and improving manufacturing techniques.
In summary, demand is increasing, while cost of production is lowering at the same time.
RBTZ fund overview
For investors interested in gaining exposure to this ASX ETF, the fund invests in companies involved in industrial robotics and automation.
It also invests in companies involved in non-industrial robots, humanoid technology, robotics-focused AI and unmanned vehicles and drones.
Recently, the fund has undergone a timely evolution in response to key development in the Robotics and AI landscape.
Some key changes include:
- The index now explicitly includes a Humanoid Technology theme and has sharpened its AI definition to focus exclusively on AI that powers physical systems – chips, software, and platforms enabling robotics and autonomous operation.
- The index now includes companies listed on mainland Chinese exchanges via the Hong Kong Stock Connect program – giving investors direct exposure to some of the most consequential companies in the humanoid robotics value chain that were previously inaccessible.
- Recognising that many of the most exciting players of next-gen robots and AI are still in early commercial stages, the index now admits pre-revenue companies actively developing relevant technologies.
The post 3 reasons this AI and Robotics ASX ETF is a long term play appeared first on The Motley Fool Australia.
Motley Fool contributor Aaron Bell has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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