Today, majority of the manufacturing industries are willing to implement automation in their plants depending on their specific benefits. Implementing automation into an existing production line requires a pre-study of all the operations to find out the optimal working area and working sequence that is possible to automate with the highest possible degree of efficiency. Thereby, this thesis work involves the study on the potential of implementation of collaborative robot in manual assembly lines of 13-Litre diesel engines thereby creating a human-robot collaboration scenario in the assembly line. This project was carried out at Volvo's powertrain production plant located in Skövde, Sweden. The initial study of assembly lines consisting of a predefined number of stations in the production of diesel engines was conducted. Concepts were developed and evaluated considering the results from pre-study using a suitable method. The finalized concept was simulated to visualize the practical benefits, obtain accurate timing data, and also to check for bottlenecks in the presented solution. A preliminary risk assessment process was carried out to identify and evaluate the possible risks that were involved in the finalized concept. The risk assessment process ensures the safety of the operator within the collaborative robot work cell. The study is concluded with an economic analysis which includes the figures for investment, payback period as well as the profit estimation for the simulated automation solution.