Smart factory investment at critical stage

27 April 2020

A research paper, entitled Industry 4.0: Rising to the Challenge, has been published by Siemens Financial Services (SFS) as the first of a series on the investment challenges faced by manufacturers migrating their businesses to Industry 4.0 technologies.

The report highlights the fact that Investment in digital transformation now constitutes the difference between surviving and thriving for companies, even more so in the light of recent economic uncertainty that comes with the current Covid-19 pandemic.

SFS has developed a model which conservatively estimates the size of the investment challenge faced by the manufacturing industry as it seeks to implement smart factory technology during the five-year period 2020-2024.

Previous research from the company found that the ‘tipping point’ for investment, at which half of manufacturers will have substantially migrated to Industry 4.0 production platforms, will occur within the next five to seven years.

New financing models to enable Industry 4.0 investment are often aligned to business outcomes, to integrate financing closely with the expected rate of return-on-investment delivered through the benefits of digitalized technologies. “Given the twin pressures of growing competition in domestic and export markets for European manufacturers, investment in digital transformation is at a critical point,” said Brian Foster, head of industry finance at Siemens Financial Services. “Smart finance enables sustainable ways to invest that facilitate clearly identified desired business outcomes for the manufacturer, all achieved through access to the right technology and services with support from a knowledgeable specialist financier. This is especially supportive given the likely economic impact of the current global healthcare crisis.”


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