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The digitalisation of the UK automotive industry

The digitalisation of the UK automotive industry

A new report commissioned from KPMG by the Society of Motor Manufacturers and Traders (SMMT) has highlighted a £74 billion opportunity for the UK if the industry fully embraces digitalisation over the next two decades.


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Digitalisation of automotive industry

Alongside the ongoing development of ultra low emission and connected and autonomous vehicles, the transition to digital manufacturing represents the biggest step change for automotive manufacturing since the introduction of automation in production lines in the 1960s.

New technologies such as intelligent robotics, 3D-printing and artificial intelligence, combined with new approaches to data management, will help manufacturers and the supply chain to save time, boost productivity, reduce waste and costs, and respond more effectively to consumer demand. These technologies will also reduce plant maintenance and machine downtime, enable faster product planning and more accurate forecasting of customer needs.

Customers, meanwhile, will enjoy greater levels of personalisation, more product content and connectivity, more responsive service and even shorter waiting times for new models.

The Digitalisation of the UK Automotive Industry’ report, launched at SMMT’s annual dinner, examines the future of digital manufacturing, also known as Industry 4.0, and outlines the benefits for the industry, consumers and the wider economy, as well as highlighting the potential challenges the UK sector must overcome.


Key Highlights include:

  • The automotive industry is a vital part of the UK economy accounting for more than £71.6 billion turnover and £18.9 billion value added. With some 169,000 people employed directly in manufacturing and 814,000 across the wider automotive industry.
  • Interviews revealed a number of digitalisation pilots at vehicle manufacturers and suppliers but did not find any fully digital factory implementations in progress. Connecting supply chains and customers digitally was at an even earlier stage of progress. 
  • Our forecast is that if the UK automotive industry made a step towards embracing digital technologies leading to fully digital vehicle manufacturing factories within the next 20 years, by 2035 gross value added in the UK would be higher by £8.6 billion (at today’s prices), representing 0.3% of GDP. Cumulatively, by 2035, the UK economy would have benefited by £74 million (at today’s prices).

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