In a fast-changing world, the rate of development in China is making 'legacy' OEMs look again at their model cycles
Chinese brands like Aiways are forcing change in the industry
Manufacturers like Kia are looking at changes to prototype testing to speed up development
How do you speed up the development of new cars? The issue is one that car makers have grappled with for decades as they fight to stay ahead of rivals and keep on top of new trends. However, the need to come out with relevant product has become much more acute as battery technology evolves ever faster and China in particular forces the pace of development to an extent not seen in traditional markets.
The penalty for getting it wrong has never been harsher, particularly given this EV and software-defined era. “The product lifecycle of vehicles is so long that by the time you’ve launched a new vehicle, the technology can be very old,” said Neil Endley, global director for turnaround services at quality consultants Trigo. “It’s like buying a TV, fixing it on the wall and, disappointingly, the first advert you see is for a brand-new TV that supersedes yours. The rate of technology is racing.”
The speed at which the Chinese are replacing vehicles in particular is worrying traditional car makers. Nissan CEO Makoto Uchida voiced that fear recently, referencing the pace of China’s brands. “They do have the speed to market, which we need to learn in the future,” he said, acknowledging it would require a very different corporate culture. “Do we do that as a Japanese enterprise? We do lots of testing and experimenting before we hit the road.”
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Executives and engineers who have experienced China’s unique turn of development speed say it’s both illuminating and cautionary. “The pace is so fast [that] things can get done very quickly and they don’t get stuck in the corporate process,” one executive with experience of leading a global brand in China said, on condition of anonymity. He references a fairly big change needed for one of the brand’s models to keep pace with the competition.
“The Western engineers said 24 months. The Chinese engineers believed they could do it in six months,” he said. The solution involved so-called dual-path testing – ie testing different elements in parallel rather than sequentially to speed it up. “It showed me they were much more nimble and able to respond,” he said. “It’s partly energy and drive, partly just naivety [that] something’s going to work but won’t.”
One way that brands have sped up the process of designing and building a car over the years is increased use of simulation, particularly in the areas of crash testing, aerodynamics and fuel economy. One Chinese company, Jidu, a collaboration between tech firm Baidu and car giant Geely, is promising to decouple the software development from the hardware for its new autonomous car promised for 2023. The work done on the company’s virtual SIMUCar is then paired with the electric chassis to create what it calls “R&D efficiency”.
Of course, what the customer considers up to date in a new car could be restricted to what they see on the screens, and the development of the software can be done away from the car and delivered via over-the-air updates, or even off-board via cloud internet connection.
In announcing its recent tie-up with chip supplier Qualcomm, Renault reckoned that not only could it cut a year off the development time of on-board software by working with the company, but it could also build new services in the cloud and deliver them in three to six months compared with around three years now, Thierry Cammal, the head of the Renault Group’s Software Factory said.
The key to unlocking this is the new smart chips, essentially a powerful computer that controls a range of functions within the car. This way, Renault and others say, even second-hand cars could come with the latest software and features, spelling the end of automatic obsolescence. In theory, anyway. A chip supplier like Qualcomm is more used to the fast turnover of the mobile phone business, which demands upgrades annually whereas the automotive industry would require a useful life of 10 years or more.
Speeding up the development of hardware is more difficult but, as with any development process, there’s always slack to be removed. “If we make up our mind, and we come together as a team like we did on Maverick, it could be just two years,” Ford CEO Jim Farley said on an analyst call in October, in reference to the company’s US-only budget pick-up. Normally, a car is developed in around three and a half years. “We knocked 20 months off the Maverick development, but it required the leadership team to not have the hand-wringing in the [design] studio for six months, like we normally did.”
However, he did say that a longer lead time is good for EV launches like the F-150 Lightning electric pick-up or Mustang Mach-E. He said: “It’s not just the speed of your product creation. It’s whether you can be flexible and agile in your industrial system.” The key to that, he said, was to book reservations early “so that our industrial system can react to the orders”.
VW is getting around the problem of the fast pace of electric battery development by coming up with the so-called ‘unified cell’ that stays the same shape no matter what the chemistry. The company’s preferred prismatic cell is better packaged than current systems and will make its debut in the Artemis project in 2023, the firm said last year.
Start-ups are trying a new approach in which they put the vehicle together in modules rather than sourcing every part from individual suppliers. “In a traditional vehicle, you might have 3500 suppliers tied to that car,” said Trigo’s Endley. “We’re working with one particular newbie who has 77 suppliers. Another one has just got 23.”
This modular-based procurement works well for simpler vehicles such as electric delivery vans, where speed to market, cost and the latest technology are key elements, perhaps more than the final polish of the vehicle. The risk is now with the supplier, but choosing someone established reduces those risks.
The electric lorry from Swedish start-up Volta has moved incredibly quickly. “The project has been intense,” said Carsten Astheimer from British firm Astheimer Design. “We had our first running prototype for Volta in 12 months from the first sketch.” The difference between that and traditional car companies was marked. “The OEM process can be incredibly bureaucratic and regimented,” he said. “What you can do with start-ups is say let’s see what the project is about and we’ll create a process to suit and go through it much quicker.”
However, the danger is that if you skip too many processes, quality suffers. The development speeds of the consumer electronics industry aren’t repeatable in the car industry simply because the focus on safety and enduring quality has to be so much tighter. Any gains made by speeding up the process could be thrown away with prominent and expensive recalls. As Trigo’s Endley said: “You don’t want to be testing cars with the driver.”
Keyword: How Chinese car companies are forcing faster development times