High-tech dash­boards sig­nal big changes and fewer parts

The National - News - Business - - Analysis - Alexan­dria Sage

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.

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