Mastering artificial intelligence will be key to the future of the automotive sector; firms that fail to do this risk being left behind. IMD’s AI Maturity Index unveils the strategic approaches driving transformation among industry leaders, write Tomoko Yokoi and Michael Wade.
Artificial intelligence is reshaping every aspect of the automotive industry, from manufacturing operations to autonomous vehicle deployment. Industry leaders recognize that AI maturity extends beyond isolated use cases to encompass comprehensive organizational change, transforming how companies design, build, and sell vehicles.
At IMD’s TONOMUS Global Center for Digital and AI Transformation, we evaluate organizations across five critical dimensions that distinguish AI leaders from followers. Our proprietary AI Maturity Index reveals how automotive industry leaders are systematically building capabilities that create sustainable competitive advantages in an increasingly complex technological landscape.
Examining the 2024 AI Maturity Ranking reveals distinct patterns among the most AI-mature companies, namely Volkswagen Group (#22), Hyundai Motor (#23), Toyota Motor (#25), and General Motors (#27)
AI maturity in the automotive sector begins with bold leadership decisions that position artificial intelligence as fundamental to corporate strategy rather than a peripheral tech investment.
Volkswagen Group exemplifies this approach with its comprehensive AI strategy. In January 2024, the company established its AI Lab as a globally networked center to incubate AI-driven innovations. “We want to offer our customers genuine added value with artificial intelligence,” said CEO Oliver Blume. “We aim to link external digital ecosystems with the vehicle, creating an even better product experience.”
Chairman and CEO of General Motors Mary Barra has consistently championed AI as central to transformation strategy. At an investor conference, Barra noted that artificial intelligence will be critical to Cruise, GM’s autonomous vehicle unit, and the company overall, while her decade-long commitment to technological transformation demonstrates a sustained executive focus.
Leaders in the field recognize that AI advancement requires them not just to develop applications, but to control foundational chip technology. Hyundai Motor has shown its strategic commitment to AI by establishing a semiconductor development group in 2022, followed by an investment in Canadian chipmaker startup Tenstorrent the following year.
Toyota’s leadership commitment manifests through long-term strategic investments in AI-driven mobility solutions. Since establishing the Toyota Research Institute-Advanced Development (TRI-AD) in 2018, the company has systematically expanded its AI capabilities. In 2020, TRI-AD evolved into Woven Planet Holdings, Inc., which has explored the future of AI and mobility by building and acquiring several AI-related solutions such as Renovo, Carmera, and Lyft’s self-driving division.
“Volkswagen Group has integrated ChatGPT-powered voice assistants into vehicles for seamless control.”
The most AI-mature automotive companies have built sophisticated technical infrastructures that enable breakthrough AI applications in their vehicles while supporting deployment across manufacturing, customer platforms, and service operations.
General Motors has constructed a “data factory” processing telemetry – remote moderation – of tens of millions of vehicles. The platform democratizes vehicle health and safety insights across the organization, enabling predictive maintenance analytics and real-time fleet monitoring capabilities.
Toyota’s Advanced Drive system, part of its “Teammate” initiative, leverages AI, computer vision, and deep learning for hands-off freeway navigation. Their collaboration with Stanford Engineering achieved the world’s first fully autonomous tandem drift in July 2024.
Hyundai Motor has developed AI-powered features integrated directly into their vehicles, including the panoramic curved display and dual wireless charging in the Santa Fe compact SUV. Across their vehicle lineup, predictive AI systems enable the detection of potential vehicle maintenance issues before they arise, enhancing reliability and customer satisfaction. Beyond vehicles, Hyundai deployed DAL-e Delivery and Parking Robots in June 2024 at their Seoul facility, demonstrating practical applications of AI in logistics and space management. These delivery robots handle last-mile package distribution while parking robots optimize vehicle positioning in constrained urban environments.
Volkswagen Group has integrated ChatGPT-powered voice assistants into vehicles for seamless control, while their September 2024 partnership with Google Cloud integrated generative AI into customer applications, creating new value propositions that enhance vehicle ownership experiences. They announced plans in April 2024 to test their fully autonomous ID Buzz robotaxi in Hamburg, with the service designed to integrate seamlessly into the city’s existing transportation infrastructure while collecting real-world performance data to refine autonomous driving algorithms.
AI maturity requires deep integration into core business operations, from manufacturing processes to customer service.
AI maturity requires deep integration into core business operations, from manufacturing processes to customer service.
Toyota has operationalized AI throughout its manufacturing processes, implementing AI cameras to detect defects and systems that mimic skilled craftsmen’s techniques to accelerate training while ensuring quality consistency. Their partnership with CEVA Logistics demonstrates how AI optimization extends beyond internal operations to supply chain management and carbon emission reduction.
Volkswagen Group has deployed AI-powered collaborative robots to work alongside human operators, streamlining its manufacturing processes.
Hyundai Motor has implemented AI across customer relationship management systems to personalize service interactions and predict customer needs, while their manufacturing operations leverage AI for quality control and production optimization.
Automotive AI leaders invest systematically in workforce transformation, combining traditional automotive expertise with emerging AI competencies. This dimension focuses on reskilling employees and fostering cultures that embrace AI technologies.
Toyota’s workforce development extends through strategic partnerships, including their October 2024 collaboration with Hyundai’s Boston Dynamics to develop AI-powered humanoid robots. These robots will assist in manufacturing tasks requiring dexterity and precision while enabling human workers to focus on complex problem-solving and quality oversight functions. Toyota Material Handling Japan and Fujitsu launched Japan’s first AI-powered cloud service for forklift safety evaluation in July 2024, enhancing operator training.
Volkswagen Group created their AI Lab as a globally networked center collaborating with the tech sector, serving as a training ground where automotive engineers work alongside AI specialists, fostering knowledge transfer and developing hybrid skill sets essential for next-generation vehicle development. Separately, their March 2024 Prague IT hub launch enhances AI capabilities across multiple markets through partnerships with local technology talent and institutions.
Hyundai Motor’s approach includes partnerships with Naver for AI voice assistant development launching in 2026, supplementing internal capabilities with specialized external expertise. This collaboration enables Hyundai engineers to learn advanced natural language processing techniques while external partners gain automotive domain knowledge, creating a cross-pollination of skills across industries.
The most AI-mature automotive companies extend their capabilities through strategic partnerships that accelerate innovation while sharing development risks.
Toyota has exemplified collaborative innovation with their May 2024 collaboration with Nissan and Honda on AI and semiconductor development for next-generation vehicles. Their October 2024 partnership with NTT, involving $3.26bn for AI software development, demonstrates the scale of collaborative investment required.
General Motors extends its ecosystem through targeted partnerships including its $60m investment in Mitra Chem, while their AI-powered EV charging network optimization demonstrates practical applications of predictive analytics. Their collaboration with NVIDIA on next-generation vehicles, factories, and robots using AI, simulation and accelerated computing showcases strategic partnerships that combine automotive expertise with specialized AI capabilities.
Hyundai Motor’s September 2024 World Smart City Expo showcase demonstrated strategic partnerships aimed at smart city integration, including vehicle-to-infrastructure communication systems, autonomous public transport solutions developed with city planners, and AI-powered traffic management systems created through joint ventures with urban technology firms.
General Motors has established comprehensive AI governance extending from autonomous vehicle safety protocols to manufacturing quality assurance.
As AI becomes central to vehicle safety and autonomous operation, the leading automotive firms have implemented comprehensive governance frameworks ensuring ethical deployment while maintaining regulatory compliance across global markets.
General Motors has established comprehensive AI governance extending from autonomous vehicle safety protocols to manufacturing quality assurance. Their commitment to ethical AI deployment extends to their software quality approach which ensures they “don’t ask drivers to serve as software beta testers”.
Toyota’s responsible AI approach focuses on safety-first development methodologies, particularly evident in their autonomous driving research. The company’s AI-assisted driving philosophy focuses on “amplifying people by building models that predict drivers’ actions, developing AI that enhances driver performance” rather than replacing human judgment entirely.
Volkswagen Group’s governance framework addresses customer data protection and AI transparency, particularly important as AI systems become integrated into vehicle operations and customer interactions. Their approach to linking external digital ecosystems with vehicles requires robust privacy and security protocols to protect customer data while enabling AI functionality.
The companies that excel across the five dimensions of AI maturity consistently outperform peers in innovation, operational efficiency, and market responsiveness.
The automotive sector demonstrates how the systematic development of AI capabilities creates sustainable competitive advantages in manufacturing efficiency, customer experience, and autonomous vehicle deployment. The companies that excel across the five dimensions of AI maturity consistently outperform peers in innovation, operational efficiency, and market responsiveness.
For organizations seeking to enhance their own AI maturity, the examples set by industry leaders offer valuable guidance:
The automotive organizations positioned for future success will systematically develop AI capabilities across all these dimensions while navigating complex regulatory landscapes. This comprehensive approach creates resilient organizations capable of leading transformation toward intelligent, autonomous, and sustainable mobility solutions.
IMD’s TONOMUS Global Center for Digital and AI Transformation provides proprietary analysis and executive education focused on helping organizations enhance their digital and AI maturity. If you are interested in the AI Maturity Index methodology or would like to assess your organization’s current capabilities, you’ll find more information here.
All views expressed herein are those of the authors and have been specifically developed and published in accordance with the principles of academic freedom. As such, such views are not necessarily held or endorsed by TONOMUS or its affiliates.
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