UK manufacturers to boost AI investment amid challenges, new report reveals
Published: 19 December, 2024
A new report by Make UK, in collaboration with Autodesk, highlights growing investment in artificial intelligence (AI) among British manufacturers, with three-quarters of companies planning to increase spending on the technology over the next year. However adoption is uneven, with significant barriers preventing smaller firms from fully leveraging AI’s potential.
The report, Future Factories powered by AI, explores the opportunities AI presents for the manufacturing sector and identifies areas where government policy and industry action could facilitate broader adoption. While AI is already delivering benefits in energy optimisation, waste reduction, and resource efficiency, its integration into core manufacturing processes remains limited.
Manufacturers reported increased efficiency (69%), improved productivity (61%), and automation of routine tasks (46%) as key benefits of AI. However, many smaller firms are missing out on these advantages, with large companies twice as likely as SMEs to implement AI (71% vs. 28%). Barriers such as limited technical skills, low awareness, and lack of digital infrastructure contribute to this disparity.
Nina Gryf, Digitalisation Lead at Make UK, commented: “AI and automation are driving dramatic change in speeding up manufacturing processes and elsewhere in companies. Their potential to drive economic growth and reshape industries is becoming increasingly clear. However, while the uptake of such technologies is increasing, the UK needs a step change in the use of automation; otherwise, it risks missing out on vital transformative productivity gains.”
The report also underscores the UK’s weak adoption of robotics. At just 111 robots per 10,000 employees, the UK ranks 24th globally in robotics use, well behind comparable nations like France and Italy. Additionally, 29% of manufacturers have no plans to consider robotics, with only 16% currently using the technology.
Despite increased interest, the report reveals that a lack of knowledge and skills is holding back many companies, particularly SMEs, from reaping the benefits of AI. Nearly a quarter of firms reported increased profits from AI adoption, and a third said it enabled them to take on more work, demonstrating the technology’s transformative potential.
Srinath Jonnalagadda, VP of Industry Strategy for Design & Manufacturing at Autodesk, stressed the need for long-term commitment: “Taking advantage of new technologies isn’t a one-off investment and the silver bullet for change. It demands a shift in mindset and an iterative approach over time. A continued and concerted effort will be needed to achieve the industry transformation and workforce with the skills and capacity required to take advantage of new technology, allowing UK industry to emerge as a global leader in AI-driven innovation.”
The report calls for targeted initiatives to support manufacturers, particularly smaller firms. Recommendations include extending R&D tax relief to cover investment in capital equipment and ensuring the expanded *Made Smarter* programme delivers support nationwide. Industry leaders are also encouraged to share best practices and foster peer-to-peer learning to address cultural and awareness gaps.
The survey of 151 companies was conducted in August 2024.
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