German Industry Tackles AI Challenges at Trade Fair

German manufacturing sector tackles AI challenges at tradeshow

Artificial intelligence is poised to usher in major transformations in contemporary living, yet at an industry trade show in Germany, numerous businesses are contemplating their role in this technological upheaval.

Tourists stroll by the AI signage for Artificial Intelligence at the Amazon Web Services (AWS) exhibit during the opening of the Hannover Messe industrial expo.

(Copyright: RONNY HARTMANN / AFP)

One of our representatives mentioned using ChatGPT somewhat," said a business official from a metal processing company located in Southern Germany during this week’s Hannover Messe event.

The exhibition featuring 4,000 companies assured attendees opportunities to “live the future” and delve into AI’s “real-world uses in sectors like manufacturing, robotics, and energy,” allowing exploration at each visitor's individual speed.

A striking exhibit — a massive Rolls-Royce airplane engine developed with optimization techniques powered by AI from Microsoft and the German firm Siemens — attracted numerous intrigued spectators.

However, at the edges, the small and medium-sized enterprises (SMEs), which form the core of Germany’s economic structure—the well-known Mittelstand—frequently remained more subdued when discussing this topic.

Andrea Raaf from Herz Aetztechnik, a company that employs lasers for manufacturing vehicle and electronic components, stated that AI is still incapable of handling such tasks.

She told AFP that the components we produce are quite distinctive, hence we don't find much value in implementing artificial intelligence.

Other entities have shown greater involvement, such as the family-owned Koerner Electric, which mentioned they have been utilizing artificial intelligence for the last three years.

In front of custom-designed circuit boards, their technical director Dennis Koerner stated that AI had assisted in both the production process and the analysis of optical and electrical measurements.

Koerner stated that they have developed a compact AI tool that enables them to produce code at an accelerated pace.

It was essential to achieve quicker and more reliable outcomes without requiring multiple staff members for the task.

- Lagging behind -

Previously synonymous with advanced technology, Germany’s industrial sector acknowledges that it is falling short against American and Chinese rivals in the digital innovations set to shape the upcoming centuries.

A lot of German companies still hesitate when it comes to integrating the quickly advancing technology into their specialized areas of premium engineering.

It’s crucial not to avoid incorporating AI," stated Agnes Heftberger, managing director at Microsoft Germany. "If we do, Germany risks falling behind internationally.

At the fair, AI agents were also showcased; these are autonomous systems capable of performing various tasks ranging from coding to facilitating conversations.

Microsoft provides solutions to convert machinery information into easy-to-understand language and predict maintenance requirements beforehand.

However, Loke Olsen, an automation engineer at Confirm A/S—a Danish company that works with the pharmaceutical sector—expressed some doubt regarding AI’s capability to avoid mistakes and self-correct effectively.

He stated to AFP, 'We must ensure that AI operates flawlessly since we are required to adhere to extremely stringent health regulations.'

For certain individuals, affordability is a concern. Koerner mentioned that it appears as though "we can barely manage the costs" of several AI products displayed at the exhibition.

- 'Game changer' -

According to a Microsoft survey, nearly half of German industrial companies utilize AI for certain business operations; however, they show considerably less willingness when it comes to employing AI for product development.

According to a study conducted by the machinists' association VDMA, only seven percent of machinery manufacturers intend to implement generative AI for aiding in product design.

"Although there have been some early efforts, the investments remain insufficient," stated Guido Reimann, the deputy managing director for software and digitalization at VDMA.

The research discovered that GenAI has the potential to significantly increase the sector’s yearly profits by several billion euros through enhancing efficiency and increasing sales.

But although 52 percent of managers saw AI as a potential "game changer", it said, "its use has so far often been limited to experimental or proof-of-concept projects".

The top concerns listed were a lack of data quality, shortages of AI specialists and technical challenges.

The Fraunhofer research institute from Germany has been traveling across Germany since 2023, demonstrating practical uses of artificial intelligence in various fields ranging from woodworking to medical care.

"The practice of networking smaller businesses together frequently proves beneficial due to AI’s reliance on data," stated institute spokesperson Juliane Segedi.

The greater the amount of data available, the more effective an AI system can be. If you encounter a related issue that requires resolution, combining the data can help create a beneficial solution for all involved parties.

Various obstacles still persist. Numerous individuals worry that artificial intelligence could eventually replace their occupations.

A crucial step, according to Segedi, will involve persuading labor unions not to view AI as a menace but rather as an instrument that can support their objectives.