No National Plan, No Future: The AI Reality Facing Aussie Manufacturers

When I sat down with Dr Sue Keay on the latest episode of Manufacturing Tech Australia , I expected a conversation about factory robots, AI tools, and the usual challenges around workforce adoption. What I didn’t expect was to walk away with a deep sense of urgency about where Australia sits on the global AI and robotics stage.

Sue is not one for hyperbole. As Chair of the Robotics Australia Group up and Director of the UNSW AI Institute , she’s steeped in both the technical and strategic layers of our innovation ecosystem. So when she told us that Australia is at risk of falling dangerously behind, I paid attention.

Because here’s the thing: while countries like Taiwan have declared AI the second economic pillar of their nation (just behind semiconductors) Australia is still debating whether to invest at all. Despite our world-class talent, strong research output, and proven leadership in field robotics, we’re flying blind without a cohesive national strategy.

“At the moment, we’re not seeing any indication that either side of politics is investing in AI,” Sue told us. “That makes us an outlier globally.”

And that’s not just about political optics, it’s about competitiveness, resilience, and our ability to retain the very innovators we’ve worked so hard to nurture.

Ironically, while our robot density rankings (as reported by the International Federation of Robotics ) have slipped from 18th to 35th, Australia continues to punch above its weight in sectors that aren’t even captured in those statistics. Think mining. Agriculture. Ports. Logistics. Space. These are the unstructured, rugged environments where AI-enabled field robotics thrive. Environments that mirror our national strengths.

In short: we don’t build the world’s most robots. But we build some of the most advanced and contextually capable ones.

And yet, without government investment in compute infrastructure, national data access, or industry-commercialisation pathways, we risk watching our talent and IP drain overseas. The vision, the people, the ideas, they’re already here. What we lack is the long-term scaffolding to hold it all up.

This isn’t just a tech sector problem. It’s a business problem. A manufacturing problem. An economic sovereignty problem.

And for Australia’s mid-sized manufacturers, the ones I work with every day, the stakes couldn’t be higher.

These businesses are often the first to feel the squeeze of rising labour costs, shifting export markets, and tightening margins. They’re also the least likely to have in-house R&D teams, robotics specialists, or spare bandwidth to ‘experiment’ with AI. They need low-risk, high-impact pathways to adoption, and they need a support system that recognises this reality.

“We need to help SMEs understand what adoption looks like in their context,” Sue said. “It might be as simple as starting with process automation, mapping out inefficiencies, and building from there.”

Simple? Yes. Easy? Not without leadership.

That’s why the Department of Industry, Science and Resources upcoming AI Action Plan matters. It won’t solve everything overnight. But it’s a moment. A chance to reset the national conversation. A chance to align research, education, and industry around a common goal: making AI and robotics not just tools for the tech elite, but infrastructure for every business that wants to stay globally relevant.

Because in the absence of a strategy, we default to drift. And drift is dangerous.

So here’s the invitation. Whether you're running a regional food processor or a high-tech fabrication shop in Melbourne - pay attention. Engage with the plan. Reach out to your industry bodies. Ask your local member where they stand on AI and robotics investment. Start auditing your processes. Begin that conversation internally, even if it’s just: what would we automate if we could?

Australia doesn’t need to chase Silicon Valley. But we do need to choose whether we’re going to be active participants in this next industrial wave or passive consumers of someone else’s innovation.

This is our moment. Let’s not waste it.