LG Innotek is applying artificial intelligence (AI) to its component purchasing and quotation processes, following its use in production. By analyzing data from 2 million components, the company has reduced the time required for generating product quotations by over 70%.
On September 20, LG Innotek announced that it has implemented its 'AI Component Proposal System' across all business divisions after two years of development.
Each camera module, semiconductor substrate, and automotive component from LG Innotek contains hundreds of parts. Previously, employees had to check purchasing histories scattered across multiple systems and request quotes from new suppliers, which was time-consuming.
The new system standardizes the names, specifications, and units of approximately 2 million components, including capacitors and inductors, into a single database. By inputting necessary conditions, the AI can find similar components and compare their performance and prices.
A key feature is the 'reference price' function, which analyzes existing purchase prices and price trends to suggest appropriate price levels. The system can also predict prices for new components without purchase history, achieving a reliability rate of over 96%. The time to select candidate components has been reduced to under two hours.
Since 2024, LG Innotek has been applying AI process recipes to reduce the time needed to explore optimal processing conditions for camera modules from 72 hours to under 6 hours. This latest development expands the application of AI from production processes to the quotation and purchasing stages.
The system can also be used to secure alternative components. If a specific part is discontinued or supply issues arise, it can quickly identify similar specification products to respond to changes in the supply chain.
LG Innotek plans to enhance the system by applying agentic AI, allowing it to autonomously search for and analyze the latest component information and reflect it in the database.
Kim Jun-sung, Executive Director of LG Innotek's Purchasing Center, stated, "The 'AI Component Proposal System' is optimized for manufacturing companies that handle a variety of components. We will continue to provide value that exceeds customer expectations through AX-based working methods."
* This article has been translated by AI.
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