Why manufacturing could become a commodity

Aug 09, 2019

Digital and connected smart factories will be able to transform the auto industry by turning manufacturing itself into a commodity, a leading automotive software supplier said Tuesday at the 2019 CAR Management Briefing Seminars.

By automating factories with processes, machinery and even products that can communicate with each other, plants of the future will be transformed into highly profitable ventures capable of producing multiple products for different customers, predicted Alexander Swoboda, CEO of enterprise product costing software maker Facton.

One smart factory could be like every other smart factory.

By creating a "generic factory, which then can be rented out to whoever needs it ... the manufacturing capability itself could actually become commoditized and will produce good products that will no longer be differentiators," he said.

But that will change the way automakers and suppliers have to think about profitability, Swoboda said.

"If we want to stay on top and run profitable businesses, we need to understand those trends and see how we can deal with them and how we can leverage them."

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