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Production 4.0: Audi plans for the smart factory

Automotive production is becoming more integrated and at the same time has to be more intelligent and more efficient. Flexible production of customized vehicles is one of the big challenges for the future, especially for a premium carmaker like Audi. How will the "Vorsprung durch Technik" brand meet its aim of offering premium quality with added custom flexibility? The company sees the "smart factory" as the key. Whether it's body-color moldings or light-alloy wheels in a special size, almost every car is ordered with some kind of customization, and the demands are increasing. This requires of course already a lot of flexibility. While the variety of models and quality demands are increasing, automotive manufacturers such as Audi are eager to make production sustainable. In an Audi interview, innovation management members Alois Brandt and Henning Loser talk about "production 4.0" and the upcoming "smart factory." How will Audi manage the production site with its very high standards of quality, efficiency, and environmental acceptability? Will the so-called "smart factory," which should be the intelligent factory of the future, only employ robots? Alois Brandt: "With a deep look into the production, I am convinced that our employees and not machines are the relevant working forces behind the Audi brand. Machines can be bought anywhere." Increasing digitalization is paving the way for the smart factory – the intelligent, digitally connected production facility. New high-tech solutions in manufacturing should further increase the high level of quality, while at the same time the assembly work should be easier and result in better ergonomics. Can you give us a clearer imagination of the "smart factory"? Alois Brandt: "There are a lot of ideas. But the big question at the moment is: Which one is really needed and leads into the right direction?" Can you tell us a little bit more about "production 4.0"? Alois Brandt: "The assembly line as we know it in the present will no longer play the same role. If it makes sense, it will be terminated and replaced by – let's call it – a virtual assembly line. The production will be more modular than before and the car will be directed to a production point – a so-called 'island of competence' – where it is needed." Henning Loser: "If the vehicle is to be assembled to the customer's wishes, it is obvious that efficient programming of robots and coordinating with the human workers is needed.

Weekly Recap: Audi pulls back the curtain on its future

The E-Tron Quattro concept is the future of Audi. It embodies all of the traits that will make the brand – and electric-powered luxury vehicles – more relevant into the 2020s. Here's why: The E-Tron Quattro concept, which will debut next month at the Frankfurt Motor Show, is a large sport utility vehicle that promises a range of 311 miles. It's an all-electric daily driver that fits the needs of most Americans. In production – which Audi says starts in 2018 – this vehicle will seat five and likely be called the Q6. You can take your family from Boston to Philadelphia without recharging. That's mainstream. We're moving away from the industry's "science experiment" era (as General Motors product chief Mark Reuss once described the appearance of the first gen-Chevy Volt) to a period where electric vehicles are plausible and practical for many US buyers. The 2018 Q6's only holdup for the masses will be price. But if you can afford an Audi SUV, you'll be able to buy an all-electric version. The E-Tron concept uses Volkswagen Group's second-generation modular longitudinal platform. The lithium-ion battery is located between the axles and below the cabin. Urquhart says the production model will feature the automaker's latest battery technology developed with LG Chem and Samsung. IHS Automotive projects the Q6 will sell more than 40,000 units annually by the end of the decade. "The E-Tron Quattro is a precursor for what will be an exciting and landmark production model for Audi and will position the brand at the forefront of the premium EV market," IHS analyst Tim Urquhart wrote in a commentary. It's the Tesla-zation of America. It's the Tesla-zation of America. The Q6 will be a Model X fighter, and expect other automakers to follow suit, particularly in the luxury sector with SUVs and other large vehicles. They offer more space for the battery packs, and development costs can be recovered easier. "Premium brands have an inbuilt advantage in terms of introducing [electric] powertrains over more mainstream automotive brands," Urquhart wrote. OTHER NEWS & NOTES Analyst says Tesla stock could be worth $465 a share Morgan Stanley analyst Adam Jonas sent shockwaves through the industry when he said Tesla stock has the potential to reach a whopping $465 a share. That's a leap from its $230.77 price at Friday's market close.

Audi looking for Tesla-style, non-traditional way to sell EVs

As part of Audi's notable EV emphasis at the Los Angeles Auto Show last week, there was a bit of a secondary discussion on just how the automaker might get to the point where 25 percent of all of its sales would be electric vehicles. After all, no major automaker has figured out how to crack into the double-digit percentage of plug-in vehicle sales. The problem might be, as The New York Times noted recently, that traditional dealerships just don't know how to sell EVs. While no one at Audi was saying that the automaker is going to open up its own EV stores, like Tesla has, but two Audi of America executives were certainly warm to a different style of how an automaker can encourage EV sales. Filip Brabec, AoA's director of product management, said that Audi is at least considering making changes, including some sort of different dealership experience and perhaps a new kind of test drive. "The traditional automotive approach is not necessarily working," Brabec said. "A lot of it has to do with the complexity of the product and the complexity of the offer and it's difficult, I think, to bring that into a classical dealership and sort of treat is as another car and off we go. I think there needs to be some differences in how we go in the future." AoA president Scott Keogh said that Tesla has shown the rest of the industry how to make selling EVs a complete experience. It's not just about the car, he acknowledged. "I think we have to give Tesla credit where it's deserved," he said. "I think the charging network, at least from a public relations point of view, is quite strong and that's definitely added to the message." So many automakers want to have that, "Tesla fighter," as we've heard over and over recently, but Keogh hinted that Audi could do a better job than Tesla is doing today. "I think they've done a good job of looking at the full package. I think we have some resources and the network and everything else that we can put a fuller package together." The most important part is getting people into the cars, Brabec said. "I think exposing consumers to EVs, letting them experience EVs is another big aspect, and probably different than we have today, because test driving a car today is a very conventional thing. It's probably not going to be as conventional with EVs, particularly if you've never been in one before." We can't wait.