2022.01.17 Hyundai Motor Group

Value Chain Innovations from Creative Destruction

Hyundai Motor Group
With the advent of the fourth industrialization in the 21st century, how might factories—the legacy from the first industrial revolution in the 18th century—survive? By incorporating new technologies, of course. The AI-led disruption happening all over the world is impacting factories as well. Get ready to meet the “Smart Factory.” Also called ‘futuristic factory’ or ‘intelligent factory,’ the smart factory is a manufacturing platform run by an automated system based on digital data and ICT (Information and Communication Technology). An answer to the limitations of the traditional, manual-labor dependent factory, the smart factory is fast rising as an innovative alternative.


In Hyundai and Kia’s focal vision, the smart factory is understood as a manufacturing platform whose technology avails production that is more consumer-oriented than ever. This vision is embodied in E-FOREST, the Group’s smart factory brand, which is based on three central premises: ‘Auto-FLEX,’ which implies flexible and highly automatized production processes, ‘Intelligent,’ which implies the establishment of AI-based autonomous control systems, and ‘Humanity,’ which implies making hazardous operations autonomous as well as making eco-friendly factories. The E-FOREST is thus envisioned as an organic network of humans, nature, and technology that will help unlock the limitless potential of mobility’s future; with it, the industry itself will be rendered more efficient and economical, delivering satisfaction and value for the future consumers.

FUTURE | Incorporating Industry 4.0 for Consumer-oriented Manufacture

The smart factory applies such ICTs as AI, robotics, IoT, and Big Data to the existing production process (assembly, logistics, quality control, etc.) to make them more “intelligent.” The sensors throughout the factory gather and analyze real-time data to give a comprehensive view of the entire production process, and the data integration between the processes can eliminate redundant operations. Getting robots to do the jobs not easily filled by humans can also improve efficiency as well as worker safety and welfare. 

The revolution brought to the production process can free more time and money for development, helping the engineers focus on building better cars and ultimately allowing the consumers to enjoy high-quality products at reasonable prices. Big Data and AI will be responsible for predicting the supply, endowing the company with the flexibility to quickly adjust to sudden market shifts; even analyzing the data of each consumer, and individualizing the production process to match his or her specific demands, may become possible.

Core Objectives of Hyundai’s Innovations in Manufacture

1. Flexible Manufacture

Cellular Manufacturing (Push -> Pull manufacturing), no limits to the number of models that can be assembled 

Current: 4 Models
HMGICs: Limitless

2. Higher-degree Automation

Automate logistics and assembly to a globally unparalleled level

Current: 7% of logistics automated
HMGICs: 70% of logistics automated

3. Human-robot Collaboration

Installation of Co-bots to reduce the need for auxiliary human labor

Current: 21.5% of the total labor from the assistant
HMGICs: 5% of the total labor from the assistant

4. BTO (Build To Order)

BTO manufacture minimizes the lead time & inventory

HMGICs: lead time within 12 hours.

5. Intelligent Factory

All value chain data managed in integration to minimize operation costs

HMGICs: 30% reduction in costs compared to the present

6. Immaculate Quality Control

Using QC data from automated, standardized quality control processes to reach zero assembly claims

Testbed for Smart Factory Technology: Hyundai Motor Group Innovation Center in Singapore

To realize its consummate visions of the smart factory, Hyundai Motor Group will establish Hyundai Motor Group Innovation Center in Singapore (HMGICs) in the Jurong Innovation District by late 2022.

Singapore is an innovation mecca of Southeast Asia and a home to some of the world’s leading global companies, universities, and research institutes. Taking advantage of this local talent pool, the Group is seeking to develop an open innovation ecosystem within the HMGICs—one that would develop and validate new business models and technology across the value chain of future mobility, including R&D, business, and manufacture. 

In particular, the HMGICs is expected to develop, and serve as a testbed for, the Group’s manufacturing platforms in Industry 4.0. The intelligent manufacturing platform, incorporating futuristic technologies in AI, robotics, and IoT, will serve as a milestone for the consummate smart factory in the Group’s ultimate vision. Hyundai Motor Group is planning to apply the intelligent platform to various processes—small EV production and BTO manufacture systems being some early goals—to validate its effectiveness.

HMGICs Core Objectives

KEY TECH | 1. Technologies for Production Process

Smart Tag System

Hyundai Motor Group’s Smart Tag System

It is quite common to have multiple models put together on a single assembly line; in such a case, the Smart Tag System attaches a small tag onto the car body that allows the assembly robots to recognize the specifications of the model being assembled. The system prevents such errors as where the car receives a wrong part or a faulty assembly, helping to keep the defect rates low.

Automated Inspection Protocol for ADAS Systems

The automated inspection protocol technology uses 6 robot arms to quickly—in approximately 85 seconds—inspect the finished vehicle’s five ADAS systems (FCA, Forward Collision Assist; LKA, Lane Keeping Assist; BCA, Blind-Spot Collision-Avoidance Assist; SCC, Smart Cruise Control; SVM, Surround View Monitor). Previously, these systems had to be inspected separately, making it not only more time-consuming but also more difficult to test their collaborative functions. The new technology is far more reliable and productive in ensuring quality.

Industrial Wearable Robot CEX & VEX

Designed for the assembly workers who must bear the weight of heavy equipment and/or are held to postures where their backs are bent, the VEX is a wearable robot that reduces musculoskeletal problems and increases work efficiency. Its performance and shape (angle/length) is adjustable to body type, worker strength, and work conditions, and is also lightweight (approx. 2.5 kg) enough to be useful for most situations.

KEY TECH | 2. Technologies for Vehicle and Platform Development

VR-Assisted Design Evaluation

The technology uses VR (Virtual Reality) to create virtual vehicles and surroundings, in which the engineer can efficiently review and make changes to the car’s design and structure. The technology allows the engineer to travel freely in and out of the virtual vehicle, even operating the functions as if he or she were in real life. By eliminating the need to build an expensive test car, the technology reduces the average development time for designing a new model by approximately 20%, not to mention the significant cost savings. The technology also gives the engineers the ability to perform quality control from the earliest stages of development; finally, it endows the company the ability to respond quickly to the rapidly changing paradigms of the industry and consumer demand.

Scanning & Deep-Learning of Paint Inspection Sheets

This technology, developed by the AIRS Company in collaboration with the Manufacturing Engineering R&D Center, takes advantage of a large existing database of paint inspection sheets, which are manual records of painting quality inspections by human inspectors. The information in the sheets (inspection time, vehicle model, problem type, problem locations) is scanned to build a Big Data database, which is then analyzed by AI algorithms to identify solutions to patterned issues. Notably, the technology and its underlying principles are applicable to other production processes, such as wheel alignment calibration.

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