German automaker Mercedes-Benz, which has been producing cars in China for over 20 years, is increasing research and development investment in its Chinese factories to accelerate its digital transformation and better grasp opportunities from the evolution of the world's largest auto market.
Beijing Benz's state-of-the-art final assembly workshop, featuring over 98 percent automation, relies on nearly 1,200 robots to streamline production.
These include advanced artificial intelligence visual inspection robots that can monitor product quality with more than double the efficiency of human workers. The robots collect data that is then uploaded to the factory's neural network, MO360, to inform decision-making processes.
"The MO360 system is actually a great production system that we facilitate and use here. It's actually partially developed in Germany for Mercedes-Benz cars, but with a lot of contribution here of our Chinese experts here, making use of AI and also big data, and I think the things we need in this assembly process connecting all the relevant processes we have, starting from the supply chain with our suppliers, over assembly, over quality insurance and also the maintenance of our equipment here at the line," said Joerg Bartels, president and CEO of Beijing Benz Automotive Company.
By using these digital systems, the factory has improved its production efficiency by over 15 percent, enabling it to meet the growing demands of the Chinese auto market.
According to Mercedes-Benz's data on the Chinese auto market in the first half of this year, more than 352,600 new vehicles were delivered, with the second quarter delivery numbers up nearly 10 percent from the first quarter.
In response to the rapid integration of electrification, intelligence, and networking in China's automotive industry, Beijing Benz has sped up its digital and intelligent transformation, supported by an 80-person IT support department dedicated to improving and upgrading the digital production system.
"They really help with the success of the project. I have to have daily discussions as well as a lot of collaboration activities with both local production, IT colleagues, as well as international colleagues. This collaboration would really ensure that we can leverage local digitalization skills as well as 'China speed' to take our MO360 digitalization to the next level," said Williams, an IT application expert.
Beijing Benz has now become the company's largest production base in its global network, with cars rolling off the assembly line every 45 seconds. One out of every two E-class cars sold worldwide is produced in this factory.
Beijing Benz has also formed a supply chain system covering East China and Northeast China with the Beijing-Tianjin-Hebei region at the core. Suppliers in Beijing-Tianjin-Hebei account for 30 percent of the factories inputs, and their industrial output value accounts for more than 50 percent of the national total.
With a population of more than 1.4 billion, China has a huge market and constantly upgrading consumption needs, which offers a chance for the German automaker to grow rapidly.
In the past five years, Mercedes-Benz has invested a total of 10.5 billion yuan (about 1.47 billion US dollars) in research and development in China, and its 2,000 strong team is the company's fastest growing digital Research and Development department in the world.
"When certain demands emerge in the Chinese market, our team will design and develop products based on the demands and then test the products in the Chinese market before promoting them globally," said Chang Yu, director of Mercedes-Benz China's smart cabin and smart driving project.
China's automobile market has ranked first in the world in terms of production and sales for 15 consecutive years. Having localized its businesses for 23 years in China, Mercedes-Benz has witnessed and deeply shared the opportunities in the country.
"So taking the advantage here of the Chinese expertise and the speed gives us a great opportunity not only here but for the whole Mercedes-Benz operations worldwide. And we will obviously expand, as we did in the past, and we continuously grow here in China. And we will continuously work on expanding our footprint here in China," Bartels said.
"Chinese auto and parts manufacturers have been developing and growing rapidly. This foundation makes foreign companies see very valuable resources in the Chinese market that they can acquire in the future. They can accumulate technology at a faster pace in China to compete in the future global market," said Boni Sa, director of automotive advisory services at S and P Global Mobility.
Mercedes-Benz speeds up digital transformation to seize opportunities in China
Mercedes-Benz speeds up digital transformation to seize opportunities in China
