HANOVER: Siemens AG will prioritise artificial intelligence (AI) investments in the United States and China if the European Union (EU) doesn’t adapt its restrictive regulations, according to chief executive officer Roland Busch.
Most of the company’s €1bil (US$1.2bil) investment in industrial AI will be directed to the United States due to Europe’s regulatory burden, Busch said in an interview at the Hanover trade fair.
The EU’s AI Act and Data Act “miss the mark” by treating industrial AI like consumer applications, adding new layers of oversight to areas already subject to sector-specific rules, he added.
“It’s complete nonsense to treat industrial and machine data the same way as personal data,” Busch said. “I can’t explain to my shareholders why I’m investing money in an environment where I’m being held back.”
Critics said the EU’s AI rules are too complicated and contradictory, and warn Europe could fall further behind global competitors in the emerging technology.
Engineering equipment makers, for example, are already required to comply with the EU Machinery Regulation, which will oblige them to assess and address the risks associated with autonomous systems.
Following a push by European and American tech companies and EU member states, the European Commission in November published plans to pare back the regulations in a bid to aid local companies.
The proposals called for delaying rules on high-risk AI systems for as much as 16 months, streamlining the process to report cybersecurity incidents, and easing data protection regulations to facilitate training AI models.
Busch said the Commission’s proposed adjustments are too limited to materially ease the burden.
German Chancellor Friedrich Merz reiterated his support for streamlining European AI rules in comments on Sunday in Hannover, saying his government will push “for extricating industrial AI from the current, overly restrictive straitjacket of the EU’s regulatory framework”.
“We simply cannot proceed as was once envisioned in Brussels many years ago, at a time when the sheer scale and scope of AI applications were not even remotely anticipated,” Merz said.
Once known primarily for its engineering and electrification business, Munich-based Siemens has evolved over its more than 175-year history into a provider of factory controls, software and automation products.
It’s the most valuable company on Germany’s stock exchange, with a market capitalisation of about €194bil.
Yesterday, the company introduced its Eigen Engineering Agent, one of the first commercially available AI systems designed to independently carry out tasks in industrial automation.
Rather than simply assisting engineers with suggestions, the system can take action within engineering environments, generating code, setting up configurations, and checking its own outputs.
The company said the technology can boost productivity by as much as 50%.
Applying AI in industrial contexts is generally more demanding than in consumer use cases like chatbots, as systems must meet much higher standards for precision and reliability.
Siemens started pivoting towards software with the 2007 acquisition of UGS Corp.
While software now accounts for more than a third of the Digital Industries unit’s revenue, it isn’t reported as a separate unit.
That structure is set to remain unchanged this fiscal year as Siemens works to “selectively” increase transparency and disclose more software-related metrics, Busch said.
Under Busch, Siemens has accelerated its push into software, acquiring Altair and Dotmatics for roughly US$15bil combined in recent years.
The company is continuing to pursue acquisitions across both hardware and software, Busch said.
“Of course, we look at the software sector, whether it involves simulations, AI applications, or even what we call operational software,” he said.
“Everything that has anything to do with data processing is of great interest to us.” — Bloomberg
