What is Digital Transformation in Automotive Manufacturing?

Digital transformation in automotive manufacturing isn’t new. At GE, we’ve been working with automotive OEMs and tier suppliers for 30+ years to digitize their processes.


But, that doesn’t mean that all – or even a majority – of automotive manufacturers are on the bleeding edge of digitization. I’ve toured plants of major automotive OEMS that still:


  • Have paper-based processes in place
  • Work as islands of operations. For example, the different shops – Stamping, Body, Trim/Chassis, General Assembly – act more as their own entity rather than having a holistic solution for the plant
  • Don’t focus on pulling all of their data into one place to facilitate optimization


Digital transformation in automotive manufacturing always was and still is a journey with greater gains in each step change in maturity.

Today’s challenges

Trends Toward Increased Digitization in Automotive Manufacturing


According to a recent Frost and Sullivan survey, IT spending is increasing from $38B in 2015 to $168B in 2025 – a significant growth. We will see further initiatives around digitization within the plants.


Furthermore, the COVID pandemic has pushed automotive manufacturers to look more closely at their systems to see how they can better operate in such extenuating circumstances. Challenges like the chip shortages in the industry are having an impact on production. Support for remote monitoring and control as well as reporting have been in higher demand. And, fortunately for automotive manufacturers, the pandemic is starting to subside which has increased revenues for OEMs: more people are driving than flying, which requires a ramp back up in throughput.


According to some reports, automotive manufacturers plan to increase their digital investment by up to 24% in the next few years, as they face unprecedented competitive challenges, new product requirements such as electrification, and more.


However, I have also seen firsthand that automotive manufacturers can be hesitant to adopt the latest digitization innovation. In this industry where uptime is the critical metric, many companies are satisfied with just patching their applications to ensure they can continue to build cars – but without taking advantage of new technology that could move them to the next level.


Overcoming Challenges

Improving Automotive Manufacturing Operations


Some of the challenges faced by the industry include:


  • Maintaining high uptime of manufacturing
  • Improving cycle time
  • Increasing resource efficiency
  • Ensuring cybersecurity
  • Supporting the agility required for new models, EV, autonomous, etc.
  • Retiring workforce and a new generation of digital workers


How can automotive manufacturers best utilize the capacity they have in place and be flexible as more models are introduced?


Certainly, more exciting technologies are coming from the automotive sector including autonomous and EVs. The push for EV vehicles will have an impact on the process as many steps will be skipped – for example, adding a gas tank won’t be needed. This is a big push for the industry, and flexible manufacturing processes to handle gas-powered vs electric vehicles will be an even greater requirement.


Another challenge for manufacturing (in many industries, not just automotive) is new employees coming in to replace retiring workers. This is a new generation that has grown up on computers and advanced technology. Manufacturers need to address the best way for these new workers to come up to speed and stay engaged.


Automotive IoT

Continuing the Automotive Digital Transformation Journey

Recently, we’ve worked with some customers closely to help push their digital transformation agenda. Some great examples we’ve seen from some of our automotive customers recently are:

Digitization of Weld –  By taking a paper-based process that relied on human interaction to determine weld quality and moving it to a process that reads data directly from laser welders, this major automotive OEM was not only able to improve their quality but also reduce their cycle time of the weld process.

Taking advantage of this digitized data allowed them to visualize any weld issues in real time. No longer would they need to transcribe data, sample vehicles and deal with paper. They achieved better quality and reduced cycle time – which translate to better reputation and more revenue.

Automated Storage/Retrieval System – When vehicles come out of the Paint shop, they are placed in a large storage bin to wait their turn for general assembly. Which vehicle is selected next will rely on order schedule, vehicle features, etc., so that the general assembly process can run as efficiently as possible. For instance, there may be rules that you can only run two sunroof cars in a row, or it could impact takt time.

Using real-time data on available vehicles, our automotive software system can select the best vehicle to put on the general assembly line next. By doing this, we are ensuring general assembly has the most efficient plan to deliver the needed vehicles for plan. This can help reduce cycle time and improve throughout.

Analytics around Paint Quality – Dealing with data coming from the plant floor, we can run analytics to determine quality of the body paint. For example, looking for imperfections and Orange Peel, we can understand, based on a myriad of variables, whether a vehicle will have paint quality issues. Using this system will help improve quality and customer satisfaction, leading to improved brand equity and revenue.

All of these examples are possible by taking advantage of the large amount of data available in the automotive manufacturing and automotive operations processes.

It doesn’t stop there. More exciting technologies are making their way to the plant floor. Augmented Reality is allowing automotive customers to error proof their assembly process by showing operators what parts to install and where. Mobility also continues to make inroads at the plant, allowing visibility into data and alerts. And, the cloud is being seen more and more as manufacturers feel better about making their data available for applications.


Automotive Digital Transformation will Forever Change the Industry

The automotive industry is going through exciting times with new technologies within the plant and innovative products for consumers.

Digital transformation is a means for OEMs and tier suppliers to evaluate their processes to determine how they need to change to get these new products to customers.

As a “car guy,” it is exciting to watch. And, I’m looking forward to COVID restrictions easing, so I can get back in the plants in person!

For now, check out my video about how we digitized the body weld process, helping a major OEM improve efficiency and quality.