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Siemens targets up to 80% factory automation with AI, board member says - Finance news and analysis from Global Banking & Finance Review
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Siemens targets up to 80% factory automation with AI, board member says

Published by Global Banking & Finance Review

Posted on October 19, 2026

1 min read

· Last updated: October 19, 2026

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Siemens Targets 80% Factory Automation with Major AI Investments

Siemens' Vision for AI-Driven Factory Automation

Erlangen, GERMANY, Oct 19 (Reuters) - AI could help preserve manufacturing jobs in high-wage countries such as Germany by boosting factory automation to as much as 80%, Siemens executive board member Cedrik Neike said on Monday.

Productivity Gains and Competitive Edge

Speaking at the company's electronics plant in Erlangen, Neike said manufacturers need annual productivity gains of 7%-9% to remain competitive.

Current and Future Automation Levels

• Siemens aims to harness AI to raise the level of automation in factory manufacturing to 70%-80% from 30%-40% currently, Neike said.

Partnerships and Technological Innovations

Collaboration with Nvidia

• Siemens and Nvidia are working on the use of "physical AI" in manufacturing, using digital twins and AI models to simulate and optimise factory operations before they are deployed on the factory floor.

Investment in Erlangen Electronics Plant

• The German engineering company aims to turn its Erlangen electronics plant into a showcase for AI-powered manufacturing and will invest €500 million ($561 million) to expand the site by 2030.

Financial Context

($1 = 0.8909 euros)

(Reporting by Alexander Huebner, writing by Cian Muenster)

Key Takeaways

  • Siemens sees AI-enhanced automation as a way to preserve manufacturing jobs in high‑cost regions, targeting 70–80% automation versus today’s 30–40%, enabling annual productivity gains of 7–9 % (Reuters)
  • In collaboration with NVIDIA, Siemens is deploying “physical AI” via digital twins and AI models to simulate and optimise factory operations before real‑world deployment, reducing engineering effort by up to 85 % and cost by up to 20 % at Erlangen (press.siemens.com)
  • The company is investing €500 million to expand and modernise its Erlangen electronics plant into a global R&D and industrial‑metaverse hub by 2030 (press.siemens.com)

References

Frequently Asked Questions

How much factory automation does Siemens plan to achieve with AI?
Siemens aims to increase factory automation to 70%-80% from the current 30%-40% using AI technologies.
What is the purpose of using AI in Siemens factories?
Siemens uses AI to boost productivity, remain competitive, and preserve manufacturing jobs in high-wage regions.
What is 'physical AI' and how is Siemens implementing it?
'Physical AI' refers to the use of AI and digital twins to simulate and optimize factory operations before physical deployment.
How much is Siemens investing in its Erlangen plant expansion?
Siemens is investing €500 million ($561 million) to expand and upgrade its Erlangen electronics plant by 2030.
Which companies are collaborating on AI for manufacturing?
Siemens and Nvidia are collaborating to apply AI and digital twins in manufacturing processes.

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