A new report from KPMG has revealed that through adopting digitisation in the automotive industry, the UK economy could gain up to £74 billion by the year 2035.
The report tiled The digitisation of the UK automotive industry explores the benefits that new technologies such as robotics, artificial intelligence and 3D printing could have on the industry. The Society of Motor Manufacturers and Traders (SMMT) commissioned the report to better understand how these emerging technologies could impact the future of their businesses.
KPMG's report calls for the automotive industry to fully embrace digitisation, saying: “By fully embracing digitisation, the automotive sector stands to gain £6.9bn every year by 2035. The cumulative total benefit to the economy could be £74bn by 2035.
“Our forecast is that if the UK automotive industry were to make a step change towards embracing digital technologies leading to fully digital vehicle manufacturing factories within the next 20 years, then by 2035 gross value added in the UK would be higher by £8.6bn (at today’s prices), which represents 0.3 per cent of GDP.”
However, this level of growth will require the automotive sector and the government to tackle a number of issues before digitisation can be fully implemented.
The report laid out the changes that need to be made for the automotive industry can embrace digitisation, saying: “The UK's digital infrastructure needs to be improved, clear policies on cyber security must be developed, the skills gap must be addressed and investment in digitisation must be accelerated. We recommend that the government places digitisation at the heart of its new industrial strategy, focusing in particular on skills, digital infrastructure, cyber security, access to finance and technology demonstrators.”
The CEO of SMMT Mike Hawes believes that the automotive industry is in a position to take advantage of what the fourth industrial revolution has to offer, saying: “Significant capital investment will be necessary and we must put digitisation at the heart of the UK's industrial strategy to ensure we are equipped with the right skills, infrastructure and standards.
“The competition from other countries is intense, so we should follow the model that is proving so successful in the development of low-emission and connected and autonomous vehicles in the UK, with a collaborative approach between government and industry.”
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