Investment in American manufacturing has been on the rise, with companies like Velo3D and Goldhofer betting heavily on domestic capacity. This week, Velo3D announced plans for a new production campus in Livermore, California, while Goldhofer established its first US facility in Hickory, North Carolina, a move expected to create 80 jobs. These investments reflect a structural shift in the industry, with supply-chain security becoming a major concern for corporate boards.

But while investment is up, costs are still climbing. June's ISM Manufacturing Prices Index came in at 73%, a 9% drop from May's 82.1%, but still marking the 21st consecutive month of rising raw materials prices. Tariff policy is compounding the uncertainty, with new rules requiring Canadian and Mexican manufacturers to commit to verifiable US capacity expansion in order to qualify for reduced Section 232 tariffs.

Underneath both stories is a third, quieter one: automation is becoming the industry's answer to a labor market that refuses to loosen. Survey data from the Manufacturing Leadership Council suggests nearly a quarter of manufacturers plan to deploy "physical AI", robots with greater autonomy, within two years, more than double the share doing so today. That's a meaningful jump in a short window, and it lines up with what floor managers have been saying anecdotally for months: they can't hire their way out of the current workforce gap, so they're automating around it.

The strategic read for anyone watching this sector: capital is chasing resilience, not just efficiency. Companies that can demonstrate traceable domestic capacity, absorb near-term price volatility, and layer in automation to offset labor scarcity are the ones positioned to benefit from the reshoring wave, while those still competing on cost alone may find themselves squeezed from both directions.

New Investments, Rising Costs

The industry is seeing a wave of new investments in domestic capacity, but costs are still climbing. Companies like Velo3D and Goldhofer are betting heavily on the US market, but the industry as a whole is facing rising raw materials prices. Tariff policy is adding to the uncertainty, with new rules requiring Canadian and Mexican manufacturers to commit to verifiable US capacity expansion in order to qualify for reduced Section 232 tariffs.

Automation is the Answer

Automation is becoming an increasingly attractive option for manufacturers looking to offset labor scarcity. Survey data from the Manufacturing Leadership Council suggests nearly a quarter of manufacturers plan to deploy "physical AI", robots with greater autonomy, within two years. This is a meaningful jump in a short window, and it lines up with what floor managers have been saying anecdotally for months: they can't hire their way out of the current workforce gap, so they're automating around it.

The Strategic Read

Capital is chasing resilience, not just efficiency. Companies that can demonstrate traceable domestic capacity, absorb near-term price volatility, and layer in automation to offset labor scarcity are the ones positioned to benefit from the reshoring wave, while those still competing on cost alone may find themselves squeezed from both directions.