2025: The year the factory floor outpaced the C-suite

The automotive manufacturing landscape closes 2025 fundamentally altered from where it began. The transformation occurred not through grand digital visions but through thousands of smaller decisions made on factory floors. Manufacturers discovered that competitive advantage stems less from which technologies they deploy than from how rapidly they implement and iterate them. Speed has become the defining characteristic of successful production operations.

"Our industry is in a big phase of change, and it's about speed," Dr Hanns-Bernd Ketteler explained at Automotive Manufacturing North America 2025. "We have a lot of new technologies and we need to be fast to compete, including with the pace we see in China. We see breakthroughs like electrification and automated driving. This requires resources and investment, and it doesn't allow us not to be lean or not to be fast, or to make expensive mistakes."

Watch: Collaboration and speed key to manufacturing transformation at Bosch

At Automotive Manufacturing North America 2025, Dr Hanns Bernd Ketteler, executive director of operations at Bosch Mobility Americas, shared how digitalisation, AI and cross-functional collaboration are driving a faster, leaner and more connected approach to manufacturing across the value chain.

The Bosch Mobility Americas executive director of operations emphasised that whilst technology dominates discussions, success hinges on people. "We need colleagues and teams to think end-to-end, not just functionally. We need to go from what I call a 'tribal knowledge culture' to a more collaborative culture where we share knowledge across functions and even across sites."

This acknowledgement represents a seismic shift in manufacturing philosophy. For decades, automotive production operated within functional silos where expertise remained trapped within departments. That paradigm fractured under competitive pressure throughout 2025, forcing manufacturers to confront cultural transformation as challenging as technological implementation.

At BMW's Debrecen plant in Hungary, a central control unit functions as mission control, monitoring incoming components, coordinating logistics and tracking flow through the plant. Every staff member carries identical work phones, ensuring communications reach everyone uniformly. Whilst the homogeneity might appear dystopian to some, it supports culture building around technology adoption. The sense is unmistakable that data is controlled and actionable, not merely collected.

Ford presents an illuminating counterpoint. Despite significant greenfield investments in BlueOval operations, the manufacturer has emphasised brownfield upgrades at facilities like Dearborn. Paul Stephens, Ford's Global Strategy Manager for Autonomous Robotics, outlined the company's pragmatic approach to automation through brownfield-first deployments and rapid in-house software development. Rather than waiting for greenfield programmes, the company is investing in technologies that retrofit existing lines with minimal disruption.

The transformation demands what industry observers now call open heart surgery. Transforming century-old brownfield sites into flexible electric vehicle production hubs without halting output represents the single most formidable operational task in automotive manufacturing today. The classical production playbook no longer applies. As manufacturers confront intensifying cost pressures and compressed development cycles, they have discovered that digital success cannot be measured by budget size but by tangible value delivered at the assembly station.

At Volkswagen's Autoeuropa plant in Palmela, rather than pursuing a multi-million-euro software package, engineers deployed lighter-weight, operator-friendly tools that directly addressed bottlenecks. This trend appeared repeatedly throughout 2025. Manufacturers choosing modular, deployable solutions over comprehensive system overhauls.

Inside Palmela: How VW transformed a 30-year-old factory for net zero

From geothermal networks to electrified paintshops and closed-loop metal recycling, Volkswagen's Palmela plant demonstrates how legacy factories can achieve significant decarbonisation—while confronting hard truths about polymer contamination and circularity limits.

The AMNA 2025 conference brought together OEMs, Tier 1 suppliers and technology partners to discuss shared challenges. Several presenters emphasised scalable brownfield solutions and in-house software that can be rapidly deployed and iterated, adopting a "think big, start small, scale fast" mindset. OEMs focused on flexible, brownfield-friendly automation, internal AI inspection stacks, central fleet logistics orchestration and asset-light procurement. Tier 1 suppliers prioritised digitisation of factories, supply chain traceability, product-to-manufacturing integration and digital factory pilots that deliver measurable schedule and space benefits.

Artificial intelligence moved from experimental status to operational reality throughout 2025, though its deployment revealed that the technology remains evolving rather than mature. At Stellantis' Factory Booster Day, more than 80 partners unveiled over 100 new solutions aimed at boosting efficiency, cutting downtime and accelerating digital transformation across its global plants. A highlight was deployment of an AI-powered predictive maintenance system in North American paintshops, developed in collaboration with KCF Technologies.

By leveraging real-time sensor data from critical assets including pumps, fan units and oven exhaust systems, the system identifies emerging issues and prioritises maintenance needs, empowering teams to act proactively to minimise disruptions. This technology has already delivered measurable improvements in uptime, reliability and preventing costly breakdowns. Keyence showcased its IV4 smart-camera system with integrated AI now in operation at the Detroit Assembly Complex, performing 100 inspections per vehicle or over 50,000 inspections per day. The solution ensures every fastener is installed, delivering real-time feedback to operators through in-station displays and automated repair alerts.

Stellantis Factory Booster Day showcases AI driven manufacturing innovations

Stellantis gathered more than 80 partners in Detroit to unveil over 100 new solutions aimed at boosting efficiency, cutting downtime, and accelerating digital transformation across its global plants.

Ford has demonstrated that inexpensive, rapidly deployable solutions can produce greater than 99% defect detection and accelerate adoption across plants through in-house AI inspection teams. Valeria Anllo noted that collaboration with suppliers and start-ups is very close, highlighting working with start-up Inbolt, a selected solution from last year's Factory Booster event. This project aimed to upgrade the capabilities of standard industrial robots combining AI and vision systems. This system enables robots to adjust their trajectory and operations in real-time avoiding conflicts or impacts.

Steve Fallon noted that AI is becoming a big part of Stellantis' planning operations. "It's becoming a very big part of planning and scheduling where you can use AI to take scheduling, utilisation, people availability data and put everything together to get the maximum utilisation of our people, reducing the amount of downtime that we have in the plants."

Yet the deployment of these technologies revealed a critical insight. Reliable, standardised connectivity and data naming foundations are prerequisites for successful AI projects. Without a strong data layer, AI and virtual validation might fail to scale or deliver trustworthy results. The industry learned this year that technology alone cannot bridge organisational silos where planning, quality, logistics and production run on separate systems.

Dr Miguel Saez, Senior Manager for Global Automation Architecture Solutions and Standards at General Motors, offered insights into how artificial intelligence can fundamentally reshape robotic automation. "We are still trying to figure out as an industry what's the right mix between EVs, hybrids, ICE vehicles," Saez observed, highlighting the unprecedented challenges facing modern manufacturers.

Traditional robotic programming is incredibly time-intensive, with Saez noting that "it takes hours, probably 100 plus hours to create a program, touch up, do the simulation, touch it up." This complexity creates significant barriers, especially for smaller manufacturers. Saez described methods like kinesthetic demonstration, where human experts physically guide robots through complex movements, allowing AI to learn through direct experience. Virtual experimentation provides another powerful training ground, creating environments where robots can experiment, fail and learn without high physical prototyping costs.

AMS Talks 2025-2026: The Human & The Machine in Carmaking

In our final livestream of 2025, we explored how automotive manufacturers are abandoning top-down digitalisation for agile, shop-floor solutions. What we discovered across factory visits is striking: transforming brownfield sites into EV hubs succeeds only when you empower people, not just deploy technology. What awaits in 2026?

"We need to start telling the AI agents this is what manufacturing is, this is what success looks like, this is what a good weld looks like," Saez explained, highlighting the importance of explicit knowledge transfer. The most ambitious aspect of Saez's vision is creating a universal library of manufacturing skills. This wouldn't be limited to specific robot brands or manufacturing sites but represent a transferable manufacturing intelligence that could be deployed across platforms.

The year brought clarity that workforce development in smart factories extends beyond technical training. It requires understanding pain points, building engagement, creating pathways for advancement, managing cultural transformation and confronting difficult questions about the future nature of manufacturing work. A panel discussion at AMNA 2025 revealed divergent perspectives on balancing technological ambition with human capability, exposing an industry grappling with questions that extend far beyond software implementation.

As global manufacturing confronts a looming skills crisis, Toyota Motor Manufacturing UK, with help from Rockwell Automation, created a training model that could reshape how the industry develops its workforce. The company established a training academy at Burnaston, recognising a stark reality. Technology advances far more rapidly than the workforce operating it. As automation grows more sophisticated, the human capability gap widens unless actively bridged.

The project trains apprentices on contemporary PLCs, HMI screens and production control systems rather than legacy equipment, ensuring graduates possess immediately relevant skills for emerging automated environments. Philip Smith, team leader for senior technical skills development at Toyota, explained the academy's strategic foresight. "We are currently undergoing a huge equipment update as part of a wide-scale transformation."

Christian Winterhalter, director of digitalisation at Hexagon, articulated that the current wave of vehicle factory innovation focuses on human-centric digitalisation. Intuitive systems, ergonomic interfaces and workflows enhance the ability of people to make better, faster decisions on the line. "It's not just about automation for its own sake," Winterhalter said. "It's about enabling people on the shopfloor to make better decisions faster with intuitive tools and systems that remove complexity."

Ryan Treece from ISA noted that the main barrier has shifted. "There is a temporary skills gap," he pointed out. "You now need process knowledge and the ability to deploy and troubleshoot code, especially when AI generates bad code. The skill set is growing, but people are the constraint more than technology."

One of the major barriers to human-centric transformation is the persistence of siloed operations, where planning, quality, logistics and production run on separate systems, limiting visibility and responsiveness. For many vehicle manufacturers, especially those with legacy infrastructure, the first step is not replacing everything but creating data interoperability. Modular training, digital onboarding and performance-based support tools are being integrated directly into production systems. This is critical as factories begin producing new powertrain architectures or managing mixed-model lines with high variation.

Production flexibility emerged as a defining requirement in 2025. With tariffs, regulatory churn and variable battery electric vehicle uptake, companies are prioritising modular architectures, local-for-local production and enhanced visibility to enable rapid rebalancing of mix and sourcing. Market uncertainty has forced manufacturers to abandon fixed production lines. Honda, BMW and Volkswagen are investing billions in systems that can switch between combustion, hybrid and electric vehicles by the hour.

Ford unveiled its Universal EV Platform and Production System, both designed to streamline electric vehicle production whilst boosting domestic manufacturing. The platform is being implemented as part of a $5 billion ($5 billion) total investment across two US sites. According to Ford, $2 billion ($2 billion) is new investment committed to upgrading the Louisville Assembly Plant in Kentucky. The system reduces the number of dock-to-dock workstations by 40% and improves ergonomics by delivering parts in pre-kitted modules with all required tools.

Ford-Renault Alliance: Ampere Platform to Power New European EVs

The landmark manufacturing alliance between Ford and Renault Group not only anchors Ford’s passenger car revival in Europe but also provides a major boost to Renault’s Ampere electric vehicle strategy by allowing the French OEM to fully utilise its EV production capacity and plants in Northern France.

The company emphasised that the Universal EV Production System requires a new set of skills and operating practices on the shopfloor. Training programmes at Louisville are upskilling employees in automation, digital quality management and module-based assembly. Ford vice president of Americas Manufacturing, Bryce Currie, spoke at the August launch, outlining how the new approach fundamentally alters assembly processes.

Until now, financial constraints and implementation complexity have limited automation to large-scale manufacturers with deep pockets and dedicated integration teams. That constraint is dissipating. Speakers at AMNA 2025, including representatives from Ford, Gestamp and ABB, emphasised the democratisation of robotics through low-code approaches, with a push to lower barriers through cobots, robot-as-a-service models, plug-and-play instrumentation and in-house apps that reduce dependence on integrators. The objective in carmaking is accelerated return on investment and broader deployment across plants of varying scale.

Several speakers advocated asset-light strategies with robot-as-a-service and operational expenditure models, so companies are able to pivot more rapidly as technology generations swiftly evolve. Brett Adcock, founder of BMW's autonomous robotics supplier Figure AI, announced in January 2025 that the company had signed its second commercial customer (with "one of the biggest US companies"), and now sees "the potential of shipping 100,000 humanoid robots". The sheer numbers envisaged for deployment show that this is far from being mere marginal experimentation.

Ford, for example, uses AI-powered digital twins to simulate assembly line scenarios, identifying production gridlocks and streamlining workflows, whilst Daimler employs the tech in engine manufacturing to optimise design and performance under multifarious conditions. Such virtual commissioning is empowering carmakers to test production changes in software before ever committing resources to physical reconfiguration, dramatically reducing risk and implementation time.

The revelation this year has been discovering that competitive manufacturing advantage increasingly stems from collapsed development processes rather than superior robotics. Chinese manufacturers have achieved what seemed impossible just five years ago. They build vehicles as well as any global automaker whilst maintaining price points that Western competitors cannot match. Xpeng celebrated its one millionth vehicle off the line in November 2025, with combined facilities reaching 600,000 units in January 2025 and 800,000 six months later.

How automation and AI are powering Xpeng's EV production

From fully automated bodyshops and in-house “smart brain” production control to high-pressure testing and rapid global expansion, Xpeng is using advanced manufacturing to scale at speed.

The Chinese manufacturer's first plant in Zhaoqing was inaugurated in 2017, with stamping, welding, painting and final assembly workshops. Fully automated, this National Green Factory-certified plant features 389 ABB robots and can produce one vehicle every 90 seconds. Then in 2023, a new fully integrated smart plant in the Guangzhou Knowledge City in Huangpu came online, adding further momentum to the production volume. Covering 126 acres, it supports production of three platforms and various vehicle models, including saloons, SUVs and MPVs.

Xpeng is accelerating its commitment to its Go-Global 2.0 strategy, one that focuses on expanding its presence in international markets. To facilitate that, it is looking at additional manufacturing in Europe, although for now it isn't making any major investments, instead choosing to partner with Magna to produce its G6 and G9 models at the contractor's Graz facility. "We started production in the third quarter of 2025 and the aim is to have a steady ramp-up in terms of capacity and volume," says Brian Gu, vice chairman and president of Xpeng. "In 2026 we hope to produce numbers in the tens of thousands, because right now we are only planning on making the G6 and G9, but as we introduce new models in Europe, we're looking at potentially being able to produce them in the Austrian factory."

Xpeng is the first Chinese OEM to contract Magna to undertake complete vehicle assembly at the Graz manufacturing facility. The Chinese manufacturer demonstrates how vertical integration and digital-first agility enable velocity. Legacy vehicle producers operate on five-to-seven-year major model cycles. Chinese manufacturers have reportedly delivered new EV designs to market in approximately half that time. Western manufacturers now confront the uncomfortable reality that their structural disadvantages run deeper than production technology alone.

Sustainability considerations grew more sophisticated throughout 2025. BMW's Debrecen plant will be the first automobile plant in the BMW Group to operate entirely without the use of fossil fuels during normal operation. The paintshop's power-to-heat technology is central to its fossil fuel-free operation. By relying entirely on electricity sourced from renewable energy, the facility has significantly reduced its carbon footprint. Although this approach increases electricity consumption, it eliminates the need for natural gas, making the plant one of the most environmentally friendly in BMW's network.

Inside BMW’s smart logistics strategy at Debrecen

BMW is redefining automotive logistics with direct delivery systems, real-time tracking, digital twins, and autonomous transport at its Debrecen plant. The OEM’s tech-driven approach integrates production, quality, and sustainability – setting a new standard for next-gen vehicle manufacturing.

BMW's Heat Grid project exemplifies energy efficiency, integrating several measures to recover and reuse energy. A multivalent storage boiler collects waste heat from various processes, reducing overall energy consumption by up to 10%. The company's battery manufacturing facility in Straßkirchen represents what BMW calls the new Bavaria speed. What has emerged in just 15 months since the building permit was granted demonstrates how faster industrial projects can be executed.

Milan Nedeljković, BMW's board member for production, noted that transformation cannot succeed without qualification and trust. By late 2025, the first high-voltage battery for testing is scheduled to roll off the line at Straßkirchen. Series production will begin at the end of 2026, with up to 1,000 high-voltage batteries per day at peak. A total of 1,600 new, high-skilled jobs are being created in what has been a structurally weak region.

According to industry analysis, 45% of employers expect headcount to remain flat in the third quarter of 2025, whilst 38% anticipate some hiring and 15% foresee cuts. Two-thirds of automakers expect to increase investments in process automation over the next year. Seventy-four per cent anticipate significant changes in the required skills for manufacturing and IT roles. This shift further erodes the traditional dominance of internal combustion engine roles, demanding new forms of workforce planning.

Many workers already feel vulnerable, with economic instability and company restructuring cited as the top threats to careers. For employers, the key recommendation is to retain skilled staff despite short-term volatility. Workers, meanwhile, are urged to focus on skills development and mentorship to preserve employability amid constant disruption.

As the year closes, manufacturers confront a paradox. They possess more sophisticated production technology than at any point in history, yet success depends less on technological capability than on organisational willingness to deploy it pragmatically. The factories that thrived in 2025 were those that recognised technology as an amplifier of human expertise rather than its replacement. They built training programmes that matched the pace of technological change. They chose modular solutions over monolithic systems. They prioritised speed of deployment over architectural perfection.

The lessons of 2025 are unambiguous. Manufacturing transformation succeeds not through grand visions but through disciplined execution. Not through revolutionary change but through evolutionary improvement. Not through technology alone but through technology married to human capability. The factories that will define 2026 will be those that learned these lessons well. They will be facilities where operators wield digital tools as naturally as previous generations wielded wrenches. Where training programmes anticipate rather than react to technological change. Where flexible production systems enable rapid response to market shifts. Where sustainability goals integrate seamlessly into operational decisions.

The year ahead demands continued investment in both technology and people, recognition that competitive advantage stems from how rapidly organisations can deploy and iterate solutions, and acknowledgement that the gap between leading and lagging manufacturers will widen as those who master pragmatic innovation pull further ahead. The transformation is far from complete, but the path forward has never been clearer. The automotive manufacturing sector is reshaping itself not through proclamations but through daily decisions made on factory floors. Automotive manufacturers who understand this distinction will be the ones who thrive.