How AI drives value in manufacturing
Globally,the use of AI in automotive manufacturing has increased significantly, with ~78% of manufacturers now incorporating AI into their operations as of early 2025, compared to 62%
just two years ago. This global momentum indicates a strong likelihood that
India will follow a similar path in embracing AI-driven transformation.
At each step on the shopfloor, AI systems interpret their environment, analyze
vast streams of data, draw actionable insights, and continuously learn from
outcomes.
From predictive maintenance to AI-powered quality control, artificial intelligence
is reshaping the shopfloor and beyond as can be seen in exhibit 2. As
automotive manufacturers strive for leaner operations, faster R&D cycles,
and higher product quality, AI is delivering tangible value across the
production chain.
Exhibit 2: Six ways in which AI will revolutionize automotive manufacturing processes
Where should automotive manufacturers focus their AI investments?
As automotive manufacturers explore AI to unlock operational efficiencies and
innovation, identifying the right use cases is critical. As identified in exhibit
3 & 4, high-impact, low-complexity use cases such as predictive maintenance, real-time vehicle diagnostics analysis for model upgradation, energy management, and AI process control offer strong near-term ROI and should be prioritized. Meanwhile, more complex but strategic bets like smart asset management and digital twin engineering may offer long-term strategic advantage.
Exhibit 3: AI use cases with high benefit and low complexity Exhibit 4: Why should automotive manufacturers focus on certain AI use cases
AI drives real results: How auto giants are transforming manufacturing operations
AI is revolutionizing automotive manufacturing with impressive results worldwide.
Mahindra & Mahindra has deployed generative AI for complete automation of
robot and heavy machinery maintenance, significantly reducing downtime, while
Tata Motors launched Digital.AI Labs to enhance smart mobility capabilities.
Globally, BMW's Regensburg plant uses AI predictive maintenance preventing 500+ minutes
of annual production disruption, and Ford's Dearborn facility employs computer
vision for paint defect detection with 95% accuracy versus 85% in human
detection.
Equally critical to technology deployment is upskilling the shopfloor workforce to
effectively leverage AI tools in their daily operations. Tata Motors has
demonstrated leadership in this area with its commitment to upskill over 50% of
its workforce with new-age auto tech capabilities within five years, by
collaborating with tech partners ARAI, Bosch etc., creating bespoke courses
with local university tie-ups, curating functional e-learnings and virtual
classrooms among other initiatives.
Conclusion
The integration of AI into automotive manufacturing is no longer a question of
"if" but "when" and "how strategically." High priority AI use cases like predictive maintenance, real-time vehicle diagnostics, equipment efficiency optimization etc. will enable automotive
manufacturers to make their operations future ready. By focusing AI investments
on the right mix of quick wins and future-proofing capabilities, manufacturers
can accelerate value realization across their operations.
How Praxis can help
At Praxis, we help automotive manufacturers unlock growth through strategic AI
implementation. As shown in exhibit 5, our work spans AI strategy, use case
prioritization, and culture change management. By selecting right AI and technology
partners, designing implementation strategies and establishing process
monitoring, we support clients in optimizing future ready manufacturing
operations with AI integration. Our tech, AI and data maturity
assessments provide roadmaps to best practice, while data factory, BI and reporting
capabilities enable single-view reporting and AI-driven insights.
By leveraging our proprietary frameworks and deep automotive industry expertise, we enable manufacturers to achieve measurable ROI from AI investments while building
scalable, intelligent operations that drive competitive advantage in the
rapidly evolving automotive landscape.
Exhibit 5: Capabilities we build and implement
