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VW turns to Amazon to streamline its supply chain

Volkswagen Industrial CloudVolkswagen Group has announced it will use Amazon Web Services (AWS) to automate manufacturing and logistics processes across its network of 122 plants and more than 30,000 facilities that make up the group’s global supply chain.

The carmaker said it had signed a multi-year agreement with AWS, the cloud computing unit of Amazon, to build a cloud-based industrial digital production platform. The services that AWS will provide include IoT, machine learning, analytics and other functions that VW hopes will make its plants more efficient and improve production flexibility.

Industrial manufacturer Siemens will also play a key role in ensuring that machinery and equipment from different manufacturers at the 122 Volkswagen plants are networked efficiently in the cloud.

Porsche CEO Oliver Blume, who oversees production across the VW Group’s 12 brands, said the collaboration with Amazon would “strengthen production as a key competitive factor”.

AWS CEO Andy Jassy promised in a statement that “Volkswagen’s and AWS’s collaboration will have a profound impact on efficiency and quality in production through Volkswagen’s global supply chain.”

The planned ‘Industrial Cloud’ will gather all data from VW’s manufacturing plants in real time and the functions provided by AWS will be designed to help boost effectiveness and track vehicle parts across the supply chain.

Teams from Volkswagen and AWS have already set 140 projects for integration, including a system for tracing the transfer of goods in and out of the factory by truck and services for the cross-plant analysis of system efficiency. The goal is to put the Industrial Cloud and the first concrete services and functions into operation by the end of this year.

VW said that, combined with a company-wide data ‘lake’, it expected the new system to provide insights into operational processes that would help identify gaps in production and waste.

The two companies also plan to deploy machine learning to optimise the operation of machinery and equipment.

Over time, VW plans to include its 1,500 suppliers and partners in the project.

AWS offers a broad range of cloud-based applications which companies pay to use, avoiding the need for them to invest in their own infrastructure. As AWS serves numerous clients, it can easily scale its offering as and when needed.