Collaboration with Electronics Industry Ensures Automakers’ Needs are Met
Collaboration is touted as a critical element of the automotive industry’s solution to navigate the future — whether that be the new normal post pandemic or e-mobility, autonomous, or shared mobility evolutions. Car companies are working with government to define regulation and educational and research institutions on how best to implement new infrastructure, and they are converging on design and manufacturing to consolidate efforts, reduce costs, and accelerate EV advancement. Examples of this collaboration exist throughout the industry.
At a recent Vehicle and Transportation Technology Innovation (VTM) meeting, one of the local officials said in her welcome, “Only with collaboration will risks become opportunities.” This could not be truer for the automotive industry than now in this stage of the paradigm shift.
General Motors (GM) writes, “We cannot reach the future we envision alone — we must continue to pursue collaboration opportunities with leaders across the industry“. GM acts on this statement through partnerships with Nikola, Honda, and LG Chem. Tesla’s end statement of its popular Battery Day was, “The supply chain needs to grow with us.” And they called for their supply chain to share with them what’s wrong in their specifications with suggestions on how to improve.
Strategic alliances like the Renault–Nissan–Mitsubishi Alliance formed over the past couple of decades to advance the electric future through investments in startups for infrastructure and technology. “Reports show that Nissan will expand cooperation with Mitsubishi for plug-in hybrids in Asia and Renault for EVs in Europe.”
Just these few examples demonstrate a fundamental shift and recognition by the industry that working together will get us to the end goal faster. But old habits die hard. While significant partnership is recognized in building infrastructure and necessary regulations to allow mainstreaming the new electrification and autonomous technologies, collaboration in the design and build standards seem to be lagging.
Why are we not hearing more automaker voices in the design and manufacturing of standards? Here is my take on this, but I’d like to hear from you about what I may be missing. As I said, old habits die hard, and structural change takes time. The regulatory space for EV and autonomous technology is a new frontier, and it is easier to collaborate on the unknown where we all feel at a disadvantage. In design and manufacturing, the norm of the automotive industry has been to work separately to protect their ‘secret sauce’ and maintain competitive advantage. Additionally, standardization is traditionally on the tail end of the development process as technologies mature. But as collaboration becomes the norm, the opportunity increases to build standards earlier which helps supply chains support automakers more consistently, brings down total cost, and drives focus on further technology development.
Standardization in the infrastructure and safety space is driven by outside forces and requires the involvement of governments, environmental protection agencies, and safety advocates. Design and manufacturing standards have been driven by the automakers based on their R&D. Unless there are supplier challenges they can’t resolve, outside collaboration hasn’t been critical. It is possible to collaborate and not give up proprietary information. We have seen this with the industry coming together to develop quality process standards (www.AIAG.org). Just as these standards have significantly reduced the burden on suppliers in understanding customer requirements and improved supplier consistency and efficiency, the same can be done for automotive electronics standards.
Significant time and money have been invested over the years by each company to create their own internal standards and supplier communication tools. It takes a concentrated effort and significant time investment to modify this structure. Yet, we are doing this with infrastructure and customer behavior in the transition toward electric vehicle (EV) technology. Comparatively, rethinking our standards structures is a significantly less daunting task.
As my screensaver reminds me, “You cannot do today’s job with yesterday’s methods and be in business tomorrow.” Incorporating industry standards into internal specs enables automakers to save significant time in developing and maintaining their own. By enhancing collaborative standards development in electronics, vehicle manufacturers can increase this resource savings and communicate with suppliers throughout the process more efficiently, leading to better supplier communication and faster onboarding. It will also drive and speed innovation by suppliers, educating them earlier about needs and allowing more focus on R&D versus understanding supplier requirements.
Creating standards benefits an organization in the same way that using standards does. Through the development process, you gain control of quality and reliability by identifying areas of improvement, improve communication with suppliers by working alongside them in the process, contain costs of developing standards internally, and reduce costs built in at the supplier level to assure compliance with varied automotive standards. A few, like Toyota and Ford, have seen this value and are beginning to join development and training efforts.
Evident by current partnership examples and changing industry language, it is clear that working together is the optimal way to transform. We see pods of collaboration versus industry wide efforts to test the waters and grow trust in the collaboration process. As trust builds and electronics continues to grow in criticality, electronics industry leaders can drive this shift by taking a lead role on pulling together their automotive customers, colleagues, supply chain partners, and other industry collaborators (software, etc.) to enhance and develop the standards that will recast the automotive industry. The electronics industry must be an outside force pushing advancement of partnership with automakers on standards development to help drive the automotive industry forward.