High-tech dashboards signal big changes and fewer parts
Peer at the instrument panel on your new car and you may find sleek digital gauges and multicoloured screens. But a glimpse behind the dashboard could reveal what US auto supplier Visteon Corp found: a mess. As automotive cockpits become crammed with evermore digital features such as navigation and entertainment systems, the electronics holding it all together have become a rat’s nest of components made by different parts makers.
Now the race is on to clean up the clutter. Visteon is among a slew of suppliers aiming to make dashboard innards simpler, cheaper and lighter as the industry accelerates towards a so-called virtual cockpit – an all-digital dashboard that will help usher in the era of self-driving cars.
What’s at stake is a piece of the US$37-billion cockpit electronics market, estimated by research group IHS Market to nearly double to $62bn by 2022. Accounting company PwC estimates that electronics could account for up to 20 per cent of a car’s value in the next two years, up from 13 per cent in 2015.
Meanwhile, the number of suppliers for those components is likely to dwindle as automakers look to work with fewer companies capable of doing more, according to Mark Boyadjis, the principal automotive analyst at IHS Markit.
“The complexity of engineering 10 different systems from 10 different suppliers is no longer something an automaker wants to do,” he said, adding that manufacturers eventually will work with two to three cockpit suppliers for each model, down from six to 10 today.
One of Visteon’s ideas is a computer module it calls SmartCore. This cockpit domain controller operates a vehicle’s instrument cluster, infotainment system and other features, all on the same tiny piece of silicon.
Visteon is going all in on cockpit electronics, having shed its remaining automotive climate and interiors businesses in 2016. The bet so far is paying off. The company secured $1.5bn in new business in the first quarter, helped by growth in China. Visteon’s stock price is up more than 50 per cent over the past year.
The company’s makeover hints at the coming battle between suppliers fighting for real estate in the digital cockpit. In March, Samsung completed its $8bn purchase of infotainment company Harman. France’s Faurecia, a top seating and interiors supplier, last year bought 20 per cent stake in Paris-based infotainment group Parrot Automotive SAS in a deal that could make Faurecia the biggest shareholder by 2019.
Deal-making in the wider automotive sector has been at a fever pitch over the past two years fuelled by the race to develop autonomous vehicle technology. Activity in the sector was worth $41bn in 2016, according to PwC.
Analysts say German automakers are taking the lead in consolidating functions within the dashboard. Audi was the first to debut a virtual cockpit last year that combined its instrument cluster and infotainment system.
Streamlined dashboards can lead to cost reductions for manufacturers, who can save as much as $175 per car with an integrated cockpit, according to Munich-based management consulting firm Roland Berger.
They can also help with fuel efficiency. That’s because vehicles are lighter when there are fewer behind-the-scenes computers, known as electronic control units (ECUs). Vehicles today contain 80 to 120 ECUs.
But perhaps the biggest motivation for fancy cockpits is sales. Drivers accustomed to the seamless technology of their smartphones are finding today’s dashboard offerings clunky and non-intuitive. A study by JD Power study released this month found the most complaints from new vehicle owners stemmed from audio, communications, entertainment and maps systems.
Better cockpits could prove crucial to attracting younger consumers, who are not showing the same enthusiasm for cars, or even driving, that their parents did.