Volkswagen (VW) Group has unveiled a substantial investment plan, committing up to €1bn ($1.17bn) towards the AI expansion by 2030, at the IAA Mobility trade fair in Munich, Germany.

The initiative highlights the company's focus on AI for vehicle development, industrial applications, and the enhancement of IT infrastructure.

The company’s goal is to deliver vehicles and other innovations more quickly to customers.

By leveraging AI throughout its operations, the company expects to realise efficiency gains and cost savings of up to €4bn by 2035.

Currently, the VW Group utilises over 1,200 AI applications across its key business areas, with more either in development or on the cusp of deployment.

A significant aspect of the AI investment is a collaboration with Dassault Systèmes to build an AI-powered engineering environment for faster product development.

This initiative aims to reduce the product development cycle for the brands of VW Group to 36 months or less, marking a reduction of a minimum 25%.

In terms of production, VW Group's "factory cloud", Digital Production Platform (DPP), connecting over 40 sites, is integrating new AI applications to optimise manufacturing processes, energy and material usage, and to minimise costs and CO₂ emissions.

The partnership with Amazon Web Services (AWS) has been renewed in August for another five years, focusing on enhancing the DPP.

VW Group is also pursuing partnerships with people in tech and industry to further its AI capabilities.

This includes exploring the potential of a large industry model (LIM), which would use collective industrial process knowledge to train an AI model for optimising workflows and process control.

The company is a founding member of Catena-X, an open platform for data exchange in the automotive sector, which includes other major industry participants.

Volkswagen Group IT management board member Hauke Stars said: "AI is our key to greater speed, quality, and competitiveness – across the entire value chain, from vehicle development to production.

“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.”