AI in Manufacturing: How the US is Betting on to Outpace China

Artificial Intelligence is extensively leveraged in a large group of industries, ranging from gaming, banking, retail, to commercial, and government. Now it is making its way into manufacturing. According to a study report, developing AI capabilities in industrial manufacturing is not only critical for economic transformation but also a mechanism toward sustainable competitive advantages.

Since AI is poised to significantly alter many industries, the technology is well suited to manufacturing. And when we think of manufacturing megapower, China always comes to the front as the nation has continued the lead in the manufacturing race since 2010. However, a research found that the United States has an edge over China owing to its various motives and strategies that boost AI adoption in industrial manufacturing.

The report further reveals that the ecosystem of AI in industrial applications in the US is growing rapidly. And the expensive labor force has driven the sector to improve production efficiency and lower operational costs. In addition to that, cloud service providers, smart manufacturing platform vendors, key providers of industrial AI platform and services, edge industrial AI gateway and server vendors, and chipset vendors are collaborating to bring AI into industrial manufacturing.

The US Beats China on The Factory Floor

According to another report, the US is predicted to outpace China as the world's most competitive manufacturing nation by 2020. However, in order to maintain their dominance, the China government has listed 10 key industrial manufacturing segments under Made in China in 2025, and AI is playing a vital role as a strategic component of the Information Technology segment.

Since 2015, the government has been fostering provincial and local government, public agencies, and state-owned enterprises to adopt AI in industrial manufacturing. Conversely, industrial AI startups in the US are more mature than their global rivals. Being vendor agnostic, these startups can coexist with a range of recognized industrial solution providers such as GE, Siemens, Honeywell, and bring AI on the factory floor, lessening upfront cost and the blockades to adoption.

There are also some potential hindrances for the US to lead the manufacturing race. The continued strength of the dollar could reduce international sales of US industrial exports. And smart factories need a skilled workforce, and the number of science, technology, engineering, and mathematics (STEM) graduates and upskilled workers who have earned technical training may not be able to maintain the pace with demand.

Despite this, the high labor cost and the swift time-to-market can propel US manufacturers to be more aggressive with the adoption of industrial AI solutions. Additionally, experts believe that China will also catch up as the huge investments poured into AI and all its contiguity, such as 5G and robotics, will create new opportunities for domestic companies where they all focus on AI in industrial manufacturing, strengthening China's sustainable competitive advantages.