Auto Industry to Invest Billions in Digitalization Initiatives

Automakers will invest heavily in digital factory technology over the next decade. Illustration courtesy NavVis GmbH

NEW YORK—Digital technology will help legacy automakers transition from internal combustion engines to battery-powered vehicles over the next decade. A new report from ABI Research predicts that the auto industry will increase investment in digital twins and other tools at a cumulative annual rate of nearly 9 percent, growing from $83 billion in 2023 to $188 billion by 2033.

“The transfer to EVs is driving demand for software, as manufacturers need to design new vehicles and simulate the vehicles’ performance,” says Michael Larner, industrial and manufacturing markets research director at ABI Research. “The new production lines will also need to be simulated before launch.

“Manufacturers are realizing the potential of digital twins to enable teams to collaborate to bring the new operations to life,” explains Larner. “[However], before creating digital twins, automobile manufacturers will need to remove data silos and create digital threads with suppliers such as Amazon Web Services, Google, Nvidia and Siemens.”

Austin has been senior editor for ASSEMBLY Magazine since September 1999. He has more than 21 years of b-to-b publishing experience and has written about a wide variety of manufacturing and engineering topics. Austin is a graduate of the University of Michigan.

The ASSEMBLY Show South

ASSEMBLY is thrilled to return to the Music City Center in Nashville, TN for The ASSEMBLY Show SOUTH on May 1-2, 2024. This is a booming time for manufacturing and the U.S. South is right in the heart of the action. According to ASSEMBLY’s most recent annual capital spending survey, the South is projected to account for 31 percent of total spending this year, marking the fifth straight year this region has accounted for at least 30 percent of capital spending in the U.S.

In this session, manufacturers will learn how Quality function deployment (QFD) can transform consumers’ qualitative demands into quantitative parameters that will shape the design of their product and, ultimately, their manufacturing process.

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