STANTON, Del. – Amazon’s largest and newest warehouse, with more robots than ever, brings America closer to an automated future where machines do all the work of moving everything from groceries to laptops to manufacturers to users. And do it faster.
As Amazon has built increasingly automated warehouses since it opened its first satellite hub in 1997, five miles from New Castle, Delaware, this $ 250 million storefront is something entirely different.
Inside the five-story factory – as large as 17 football fields, or four of Philadelphia’s tallest skyscrapers – an electromechanical ballet performed by robots unfolds in eerie calm. Robotic vehicles, guided by optical and motion sensors, perform tightly adjacent turns, selecting and transporting Amazon’s vast array of merchandise from storage to delivery.
There are still workers unloading supplier trucks and putting the contents away – not in expansive grab-and-go shelves, but in eight-foot-high stacks of square yellow bins. Once inside these, the goods begin their robotic journey.
Hour after hour, tireless robots grab the batteries and move them across the vast floors, dutifully stopping in front of lone, flesh-and-blood controllers waving electronic devices to check orders. Finally, workers pack the sorted goods on conveyors to transport them to loaders for delivery.
And Amazon is developing drones and autonomous vehicles to accelerate these final stages.
Rival shippers such as FedEx or the US Postal Service, large grocery chains and upstart delivery men such as Gopuff of Philadelphia have also ramped up their warehouses. But Amazon’s massive investment will force its competitors to invest much more, much faster, analysts predict.
About 10,000 Amazon-built robots here far outnumber the 1,000 newly hired human workers who spend 10- to 12-hour shifts in the 3.7 million square foot complex, which Amazon contractors have erected. on the site of a former General Motors plant that itself attracted quite a bit of publicity in its day.
Does this 10-to-1 ratio end the massive hiring that has allowed warehouse work to double the minimum wage so widely available in recent years?
Amazon and its admirers are a little sensitive on this point, so it’s worth noting up front: Amazon is still hiring, not only because so many workers don’t last a year, but also because its service is so popular that he keeps building more centers, adding people to run them, doing things the robots still can’t do. For the moment.
Amazon employed 1.3 million people worldwide last year, up from 800,000 a year earlier. Among American companies, only its rival Walmart, with all its stores, employs more.
True, some critical economists say Amazon is destroying more jobs than it creates. Other analysts say labor saving has always been the goal of new technologies.
Either way, Will Carney, the plant manager here, said, “Our hiring isn’t quite over. “
Amazon is hoping it will be easier to keep human workers this winter, when the company pledged to start providing workers with up to $ 5,250 per year for college fees. It may also add robots and employees in Delaware, although Amazon does not detail its long-term plans for the installation.
The staff, although it has increased since opening this summer, is still lower than what Amazon employs in fulfillment centers a quarter of this size.
The facility is the flagship of Amazon’s vast expansion in the Philadelphia area. Amazon plans to open up to nine new facilities in the coming months. This is in addition to the 14 sites added last year in Philadelphia and its suburbs, Lehigh Valley, south of Jersey and north of Delaware.
In total, Amazon now has more than 57 operational or ongoing centers in this greater Philadelphia area. Real estate and industry analysts call this growth unprecedented.
Yet here in Stanton, Amazon is not replacing the old GM factory, where then-Sen. Joe Biden used to launch his political campaigns, happily treating unionized workers.
Built in the middle of farm fields in 1946, the old factory at its peak employed as many as 5,000 United Auto Workers who built Oldsmobiles, Chevettes and, later, Saturns, before the last workers did. were laid off in 2009 as a recession-stricken GM. slowed down production.
A Biden-backed proposal to build electric cars failed after it burned more than $ 200 million in state and federal grants.
Manufacturers add value and GM has paid well; the distribution of goods manufactured elsewhere was historically much less lucrative. The GM plant, along with a nearby Chrysler plant, a DuPont paint complex, and a Claymont Steel plant supported a thriving US manufacturing economy after World War II. All four are closed.
Despite Amazon’s recent pay rise of up to $ 18 an hour – $ 3 more than Amazon expected two years ago when it announced its plan – non-union Amazon workers earn less as GM workers when the plant closed. (Less than half, adjusted for inflation.)
As wages rise, Amazon has relentlessly focused on consolidating operations and accelerating deliveries.
“This is just the start. You’ll see great centers like this across the country,” with other oversized facilities already expanding in California, New York, Virginia and Arkansas, Subodha said. Kumar, a professor at Temple University School of Business and an expert in supply chains and information systems.
The robots make inventory management easier, speeding up deliveries from Amazon’s small fulfillment centers to cities such as Philadelphia, Kumar said. Amazon now guarantees two-hour deliveries to many places.
“They want 30 minutes,” he said. “They intend to go shorter than that, if they can.”
Amazon said automation frees workers from boring and repetitive tasks. But workers complained that automated production was accompanied by acceleration and an above-average injury rate.
Why Delaware? This helps the state give the company, whose profits exceed $ 2 billion per month, about $ 4.5 million in initial aid, while the local government has reduced property taxes to a fraction of what GM paid. Wilmington’s proximity to the workforce in Maryland, New Jersey, and the southern suburbs of Philadelphia also helped.
“They’re trying to find locations that they can run inexpensively,” Kumar said.
(Amazon officials say it doesn’t matter how close the plant is to the Port of Wilmington, airports, and on-site sidings, as goods come in and out by truck.)
“I call these very large factories the ‘mother ships’,” said Brittain Ladd, a former Amazon logistics manager turned automation consultant.
Ladd said Amazon’s latest expansion builds on lessons from the location and system management of its highly profitable Amazon Web Services business network.
He sees the acceleration of automation as inevitable.
“During the pandemic, a lot of people decided they didn’t want to spend 20 or 30 years working in a distribution center,” Ladd said. “Amazon could employ a million people. But the turnover in some places is close to 100% per year. They can’t hire enough people. They have no choice but to invest in automation and robotics.
Amazon bought Kiva, which developed the robots deployed in Delaware and elsewhere, eight years ago – and, looking to the future, stopped supplying Gap and other retailers with Kiva machines as if to prevent compete and keep the savings for himself, Kumar said.
Ladd expects the robotic arms race to accelerate, with Amazon forcing its competitors to upgrade.
“In the long run, if they don’t innovate and automate, they won’t survive,” Kuma said of Temple. “Amazon is going very fast.”