March 21, 2020

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The future of smart factories in the automotive industry | Technology

The future of smart factories in the automotive industry | Technology

Supply Chain Digital takes a better take a look at the use of expertise in the automotive industry, following Capgemini’s report on smart factories.

The report performed by Capgemini, predicts that automotive corporations may see a rise in funding ranges and productiveness features consequently of smart factories.

Key takeaways from the report: 

The automotive industry is exceeding expectations. In the final 18-24 months, 30% of factories have been transformed into smart factories. Dr. Seshu Bhagavatula, President, New Technologies and Business Initiatives at Ashok Leyland explains that “There are three primary reasons why we took up the smart factory initiative.”

  • To enhance the productiveness of previous factories by modernising and digitising operations

  • To enhance the high quality points which can be troublesome for human beings to detect

  • To incorporate made-to-order or mass-customisation capabilities

On high of this present progress inside the industry, automotive corporations have an aggressive plan to transform one other 44% of its factories into smart factories. In addition to changing 42% in discrete manufacturing, 41% in course of industries, 40% in energy, vitality and utilities, and 37% in shopper merchandise.


Overall, by 2023 it’s estimated that smart factories may ship a productiveness acquire of US$135bn (with an optimistic situation of US$167bn). This totals as an annual enchancment of 2.8-4.4% alongside a productiveness acquire of 15.1-24.1%. Companies comparable to Mercedes-Benz Cars are seeing the advantages of smart factories, attaining a fourfold discount in rejection charges for some of its parts. 

However, at present 72% of companies are ranked as novices on the subject of the adoption of smart factories. With solely 10% prepared to learn from full scale smart factories. Reflecting on the industry, Markus Winkler, Global Head of the Automotive Sector at Capgemini, highlights the subsequent steps the industry must take in order to really see the advantages of smart factories. “Automotive companies have progressed better on their smart factory initiatives in the last two years and clearly plan to increase the pace of adoption from here onwards. However to get there, auto firms must address gaps in the talent pool, technology strategy and organisational commitment to deploy at scale, and realise the full benefits offered by smart factories. While smart factories are a critical part of the Intelligent Industry, OEMs and suppliers must also focus on smart operations including smart asset management, smart supply chain and service management to completely unlock the potential of the various technologies.”

For extra data on all subjects for Procurement, Supply Chain & Logistics – please check out the newest version of Supply Chain Digital journal.

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