Bringing Factories Back to the City

Oct. 19, 2012
The 'Factory of the Future' will be greener, leaner and an integral part of tomorrow's cities.

 By 2025, the number of megacities (cities with populations over 10 million) will grow from 23 to 36, the United Nations forecasts, and the population in the top 600 cities in the world will grow by 500 million. In the near future, Hans-Jörg Bullinger told the World Manufacturing Forum Tuesday in Stuttgart, Germany, two-thirds of the world's population will live in megacities.

Countries such as Germany won't have such massive urban areas, but Bullinger, president of research institute Fraunhofer-Gesellschaft, warned it would be a “big mistake” for manufacturers in export-dependent Germany to ignore this demographic change.

"Our cars which we develop here will be mostly driven in megacities. We have to choose products and services which fit into the specific demands of those megacities,” he told the gathering of some 400 political and business leaders examining policy issues facing manufacturing nations and companies.

Germany is sponsoring research to develop a High-Tech Strategy for dealing with six global challenges arising from such massive demographic and technological changes: health and nutrition, safety and security, mobility and transportation, information and communication, energy and living, and production and environment.

To meet these challenges, researchers are envisioning what a “city of the future” will look like and the technologies needed to deal with a more resource-constrained future. With energy, for example, Bullinger said Germany now produces 20% of its electrical energy from renewable resources. Wind farms are being planned for the relatively shallow North Sea to boost electrical production, he noted, but transmission lines will be needed to bring that power to cities such as Stuttgart and systems built to store it. "We will want to rebuild nearly the entire power system," he said.

In a smart future city, he said, part of the energy answer will be to create a more decentralized power system. Homes will become individual power sources, with solar panels on the roof and a heat pump in the basement.

Factory of the Future

Manufacturing makes up 24% of Germany’s economy and researchers plan for a significant role for the sector in the country’s future. But manufacturing, Bullinger said, must be smarter and more efficient. He noted that in the past, factories moved to areas outside cities because they were noisy and polluting.

But now, he said, many factories are cleaner and could have a new place in the urban environment. Moving them back into the city would provide a "higher quality of life," he said, by allowing employees to walk to work rather than commute in cars. Urban factories would be closer to populations of skilled workers, suppliers and technical and research centers.

In Germany, Bullinger pointed out, industry consumes almost half of the nation’s electrical power. He said manufacturers need to become both more energy and materials efficient. For example, companies save 20% in energy cost by using recycled aluminum rather than primary aluminum. Increasing the use of recyclable materials and bringing recycling facilities closer to factories could reduce energy and material demand.

When a manufacturer purchases a machine tool, the purchase price of the tool accounts for only 20% of the lifecycle cost of the machine. The other 80% is consumed with operational and maintenance costs. He said energy costs and cooling lubricant account for more than one-third of the cost of that machine over a 10-year period. So energy efficiency would have a dramatic impact on reducing manufacturing costs.

By making machining processes more accurate, he said, manufacturers benefit not only through reduced waste in the form of less scrap material but also save on the energy used to produce the scrapped product.

Energy efficiency extends not just to operational costs but to the design of products. Producing green automobile powertrains, for example, could result in not only the use of less material but also improved operating efficiency and the production of 20% less CO2.

“This is the vision we have for the cities of tomorrow ­ zero CO2 emissions, energy efficient, even higher quality of life, smart cities built on intelligent networks, resource efficient,” Bullinger concluded.

About the Author

Steve Minter | Steve Minter, Executive Editor

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An award-winning editor, Executive Editor Steve Minter covers leadership, global economic and trade issues and energy, tackling subject matter ranging from CEO profiles and leadership theories to economic trends and energy policy. As well, he supervises content development for editorial products including the magazine,, research and information products, and conferences.

Before joining the IW staff, Steve was publisher and editorial director of Penton Media’s EHS Today, where he was instrumental in the development of the Champions of Safety and America’s Safest Companies recognition programs.

Steve received his B.A. in English from Oberlin College. He is married and has two adult children.

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