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Digital factories: Industry 4.0 to unleash new highly efficient automotive manufacturing in the U.S.

2016

The impact of digitization on the automotive industry is usually discussed in a consumer-related context. But the next digital revolution is not about the consumer, it's about productivity. "There are annual savings of $16-32 bn waiting to be realized for domestic automotive production in the U.S. This equals 10-20% of the addressable production costs and is realized by following a trend which is also known as the fourth industrial revolution, or simply Industry 4.0", says Stephan Keese, a Senior Partner with Roland Berger. A new study by Roland Berger analyzes the prerequisites for these developments, compared it with the U.S. location factors, and came to a clear conclusion: The U.S. ticks all the right boxes to be the ideal playground for Digitization of manufacturing.

Digitization of manufacturing promises to offer abundant opportunities to increase efficiency and reduce cost. Relative to traditional auto manufacturing plants digital factories can produce a higher number of derivatives and variants on the same assembly line without major changeover costs, with a faster time-to-market, and a higher quality. This results in a better utilization of capacities and balanced plant and staff deployment.

U.S. automotive manufacturing plants are expected to maintain utilization rates above 90% for the next 5 years. This means that relatively soon the U.S. auto industry will reach full capacity. As Roland Berger Senior Project Manager Christian Boehler puts it, "Since OEMs will need to invest in new plants and technologies, choosing a digital factory will ensure these plants are the best able to meet the demands of the future."

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