New practices in auto industry

Issue #50, Jan 13th, 2021

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Desperate times need desperate measures. The automotive industry is facing one of its most challenging times in recent times, with not just competition but forces of disruption from many sides, some even outside the traditional auto industry. It is therefore no surprise that interesting practices not seen before are witnessed. One example is the talk about technology giant Apple tying up with auto OEMs for contract manufacturing of cars with its technology included in them. Here are some more interesting updates.

Contract manufacturing with a partner

Hyundai would likely be a production partner for Apple, akin to the role Taiwanese electronics giant Foxconn plays in iPhone assembly. For all the glamour—and potential manufacturing volumes—of being associated with an Apple-branded car, the almost $15 billion gain in Hyundai’s market value since Thursday’s close is hard to justify. Besides the risks that the talks come to nothing, or that any project drains cash for longer than expected, contract manufacturing isn’t an especially attractive business. Canadian supplier Magna assembles vehicles under other brands, notably the Jaguar I-Pace, an all-electric SUV. The activity hasn’t been very profitable. - WSJ

JV for automotive design in Japan

Japanese trading house Sumitomo Corp. and India's Tech Mahindra have launched a joint venture to offer information-technology-based design and development services to Japan's automakers and auto parts producers as the industry undergoes digital transformation. - Nikkei Asia

"The automotive industry is undergoing the kind of changes that occur only once in a century. With the expansion of CASE areas, automotive design and development is becoming more complicated and diverse. Cooperation with external partners is expected to be increasingly important and demand for automotive engineering services will further increase.", says Sumitomo in its press release last week.

From CAD to Generative Design

"CAD was and is not really Computer-Aided Design but rather Computer-Aided Drafting,” states Francesco Iorio, the CEO of Augmenta AI. “The challenges and opportunities that engineering at large has faced have been dramatically unmet so far by the tools and computers that were intended to propel the human race. Now enters a new era of truly computer-aided tools tagged as “Generative Design”. These are unconstrained design tools where the user simply describes the problem they want to solve in the form of data, requirements and preferences. - Forbes

IP focus in auto sector

Artificial intelligence, quantum computers and autonomous vehicles are among the fastest-growing areas of technology, with American companies often in the lead, according to a new study of U.S. patents issued over the past five years. Ford Motor Co. is the most active in areas of vehicle navigation and control systems, according to the analysis by Fairview Research’s IFI Claims Patent Services. - Bloomberg

Increasing battery chemical capacity to compete

Mitsubishi Chemical will lift global production capacity of liquid used in electric vehicle batteries by about 50%, in a move to better compete against Chinese players for a rapidly expanding market fueled by green initiatives around the world. Mitsubishi Chemical will pour tens of millions of dollars into global battery electrolyte capacity, including its British plant. - Nikkei Asia

Electric truck for niche delivery segment

General Motors is launching a new electric-truck business geared toward delivery services, the latest in the company’s efforts to commercialize battery technology it is developing in-house. The division, named BrightDrop will sell electric trucks and services to package-delivery operators; FedEx is first customer. 

The new division plans to roll out later this year an electric truck designed specifically for commercial purposes. Named EV600, it will offer a 250-mile range on a single charge. The move pits GM against Ford and its recently introduced electric delivery van, as well as electric-vehicle startups such as Rivian Automotive, which is making plug-in vans for Amazon. - WSJ