Dr. Wilfried Aulbur

The re-industrialisation of the Triad
In the wake of the global financial crisis, Western nations re-discovered the charm of manufacturing as a driver of innovation, employment and services. The US, UK, France, and even Germany with a still healthy industrial base all embarked on various initiatives to ensure manufacturing employment within their own national frontiers. Rather than going through all the initiatives currently underway, we will focus on ‘Industry 4.0', the German avatar of the re-industrialisation drive.

The basic premise of Industry 4.0 is that the introduction of intelligent machines, embedded cyber-physical sensors, collaborative technologies and networked processes will once again drive an efficiency revolution in industrial manufacturing.

European companies, in particular, are positive regarding the potential of Industry 4.0. Expected cost savings of 14 percent on average over the next five years would negate a large part of the factor cost advantage that countries like India enjoy today vs. developed nations (typically in the range of 15-30 percent).

Efficiency gains are expected to be even higher at 18 percent within the next 5 years. Industry 4.0 is a board room level topic for all European manufacturing companies with investments in the approach amounting to 3.3 percent of revenues on average. In comparison, a typical R&D budget of Western OEMs amounts to about five percent of revenue.

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