The automotive industry can achieve $160 billion in productivity gains annually from smart factory adoption from 2023 onwards, a Capgemini report on digital transformation reveals.
A top 102 automotive manufacturer can realize an additional $4.6 billion or a 50 percent growth in operational profits annually within five years after the implementation of a smart factory.
The report predicts the average productivity growth of smart factories within the automotive sector will be seven percent as of 2023, while an automaker will break-even within a year of executing the full potential of its smart factories.
Automotive manufacturers expect that 24 percent of their plants will be smart factories by 2022. 46 percent already have a smart factory initiative, behind only industrial manufacturing (67 percent) and aerospace (63 percent).
43 percent of automotive companies are currently formulating smart factory initiatives. The automotive sector has the highest share (49 percent) of organizations who have invested more than $250 million in smart factories.
42 percent of automotive manufacturers accept they are not on track to realize the potential of smart factories and are struggling with the technology move. This is the highest across all the manufacturing sectors studied.
The report identified that those making the best progress are investing three times more than the companies who are struggling. The more advanced manufacturers are also investing in software such as advanced analytics and AI-based components.
“By using smart factory technology in our business, we have seen great benefits with regard to our employees’ productivity. They use sophisticated tools such as smart robots to create a safer environment, which in turn provide them with more time to focus on other important tasks,” Gregoire Ferre, chief digital officer at Faurecia and a Capgemini client said.