The Volkswagen Group has announced it will invest around €1 billion to expand its AI capabilities by 2030.

The company will use the investment improve AI-supported vehicle development, industrial applications, and the expansion of its IT infrastructure.

The car manufacturer said that the aim of the investment is to make vehicles and innovations available to customers at a faster pace.

The company expects to save up to €4 billion with the consistent and scalable use of AI throughout the value chain by 2035.

Artificial intelligence is already being used across all key business areas of the Volkswagen Group, with over 1,200 AI applications already active throughout the company.

Several hundred more projects are currently in development or nearing implementation.

In vehicle development, Volkswagen said it is building an AI-powered engineering environment in partnership with Dassault Systèmes to support engineers through virtual testing and component simulations which will significantly accelerate development processes.

Volkswagen said that to maintain technology resilience, the company needs to have control over its data.

With this in mind, Volkswagen said it will expand its private cloud infrastructure in the coming years to enable more internal processing of sensitive information to protect against external risks.

Volkswagen is collaborating with technology companies and industry partners to explore the potential of a Large Industry Mode (LIM), an industrial AI model based on real manufacturing, design, and process data from voluntarily participating companies.

The company said collective industrial process knowledge could be used to train an AI model that helps optimise internal workflows and enables more efficient logistics and process control across industries and for all participants.

"With artificial intelligence, we are igniting the next stage on our path to becoming the global automotive tech driver", said Hauke Stars, member of the board of management for IT at the Volkswagen Group. "AI is our key to greater speed, quality, and competitiveness – across the entire value chain, from vehicle development to production.”

He continued: “Our ambition is to accelerate our development of attractive, innovative vehicles and bring them to our customers faster than ever before. To achieve this, we deploy AI with purpose: scalable, responsible, and with clear industrial benefits. Our ambition: No process without AI.”

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