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Industrial production peaked in late 2017 and industrial stocks are flat over the past year. The U.S.-China trade war along with slowing global economic activity are causing industrial investors to sweat. But one area of the industrial economy is still growing like gangbusters: robots.

Robotic automation is penetrating new processes in different industries, such as logistics and health care, so the outlook for robots continues to be bright, even as the economy slows. That’s good news for Teradyne (ticker: TER) as well as a handful of companies that manufacture robotic automation equipment.

The Robotic Industries Association, or RIA, recently released second quarter industry growth figures and the numbers are impressive.

“North American companies ordered 8,572 industrial robots, valued at $446 million,” reads RIA’s August 20 news release. “This represents a growth of 19.2% in number of industrial robots ordered, and a 0.6% boost in dollars compared with the same period in 2018.”

Orders and values diverge because smaller robots, including collaborative robots called co-bots designed to work safely beside humans, are growing faster than the largest, most expensive robot models. Huge robots often find their way into the automotive business—to weld and paint car bodies as well as place heavy loads on assembly lines. The global car business, however, is struggling. Sales of U.S., Chinese, and European light vehicles are declining causing auto makers to tighten purse strings and delay capital spending.

Still, for the first half of 2019 the robotic market grew 7.2%, according to RIA. “The market is getting bigger and bigger,” Sebastien Schmitt, robotics division manager of Stäubli North America, tells Barron’s. “We’re busy, our activity is higher than our expected [2019] budget.”

Stäubli is a privately held, Swiss-based maker of high precision machines, including mid-size industrial robots. The company claims to have the fastest sorting robot in the world, capable of making 100 “picks” per minute.

A TP80 Robot picks and sorts rapidly

Stäubli isn’t as exposed to the automotive slowdown, partly because it makes smaller robots, and it sees many opportunities for new robot applications. “Food [packaging and production] isn’t very automated. We have sterile robots to clean facilities and robots that can work in humid conditions,” Roger Varin, CEO of Stäubli North America, tells Barron’s. “Our robots can wash salad, in the past that couldn’t be done.”

Stäubli also recently made an acquisition in the autonomous guided vehicle, or AGV, space. Investors may recall Amazon.com (ticker: AMZN) bought Kiva Systems, another AGV company, in 2012 for $775 million. Today, orange Kiva robots move inventory all over Amazon distribution centers.

“Our AGV has 20 tons of capacity,” explains Varin. “We are trying to be different—moving higher payload around manufacturing plants.”

Robot growth is good news for the industrial industry, but the robot business is still small in the grand scheme of things. The roughly $500 million in North American orders for the second quarter of 2019, for instance, represents much less than 1% of total capital spending by global industrial firms over the same span. That’s only a proxy, but it indicates the trend toward higher automation has a long runway ahead.

Barron’s recently wrote positively about industrial conglomerate ABB (ABB) as well as semiconductor test equipment maker Teradyne. Robotic automation growth is part of both stock-pick stories. ABB makes a range of robots along with other industrial automation products. Teradyne got into the co-bot business through its 2015 acquisition of Universal Robots.

Since our positive calls appeared, ABB stock is down 1.7%, worse than the 5.2% gain of the Dow Jones Industrial Average and the 6.2% gain of the Industrial Select Sector SPDR ETF (XLI) over the same span.

Teradyne has fared much better, rising 32.4%, more than 30 percentage points better than comparable market returns over the same span.

The weak automotive market has weighed on ABB investor sentiment. It makes the largest versions of industrial robots, along with smaller models like the company’s Yumi collaborative robot. Still, Barron’s is positive on the stock and on all of the opportunities presented by robotic automation.

Write to Al Root at allen.root@dowjones.com