Japan's automotive industry is actively deploying artificial intelligence (AI) as a tool to support on-site experience and judgment, building a human-centered collaborative AX (AI Transformation) model, according to a new report. The report calls for a "hybrid manufacturing AX model" that combines Korea's physical AI-centered strategy with Japan's human-centered digital transformation.
The Korea Institute of Machinery and Materials (KIMM) published Issue No. 123 of its Machinery Technology Policy series, titled "Japan's Manufacturing AX Status and Implications — Focusing on the Automotive Industry."
The institute outlined shifts in the global manufacturing paradigm and proposed directions for Korea's response. According to the report, Toyota and Honda are using AI as a tool to strengthen organizational capabilities along three pillars: Human-in-the-Loop AI, Kaizen-driven DX, and Cultural Intelligence, the digitalization of organizational culture.
Toyota has built a system in which on-site workers directly develop applications and AI through citizen development. This has shortened development cycles while ensuring fit with field operations. Honda has likewise improved data visualization and decision-making structures through on-site DX.
A notable feature is that both companies have replicated long-standing organizational cultures through AI. Toyota built a multi-agent AI system based on its "O-Beya" collaborative decision-making culture to support the transfer of expert knowledge and design decisions. Honda developed a discussion-style AI in which multiple AI agents collaborate, based on its "Waigaya" evidence-based discussion culture. In effect, the companies have implemented decision-making structures based on collective intelligence for solving complex problems.
Citing the Japanese cases, the institute emphasized that Korean manufacturing's AX strategy must go beyond simple technology adoption and shift toward a focus on the field, the organization, and the ecosystem. "Japan has not merely adopted AI — it is redesigning organizations around AI," said Kim Cheol-hu, principal researcher at KIMM. "Future manufacturing competitiveness will be determined less by the technology itself than by how organizations use AI."
KIMM publishes Machinery Technology Policy, a specialized journal that analyzes trends in the machinery industry and proposes policies, at least four times a year, serving as a think tank in its role as a national research institute in the machinery field. Subscriptions and downloads are available on the KIMM website.
