PREMIUM SEARCH Search by job title, geography and build a list of executive contacts
There's a race under way, and all the world's major automobile manufacturers are on the track. But where the rubber meets the road isn't the pavement, it's the Internet. By linking all their diverse product-development computer systems together on the World Wide Web -- from design and parts procurement to assembly and into the showroom -- the carmakers aim to chop months from the time it takes to create a new model and days from the time required to build a car. The purse runs to the billions.
The auto companies' goal is create the car of the future in cyberspace through global collaborations with suppliers, then make the leap to reality in the blink of an eye. "All the world's major carmakers are in -- and doing 100 mph," says auto-industry watcher David E. Cole, director of the Office for the Study of Automotive Transportation at the University of Michigan (for a Q&A with Cole, see BW Online, 9/21/00, "A Chat with Dr. Detroit").
The global auto makers are well positioned to benefit hugely from a leap into virtual design. The family buggy is the biggest, most expensive, and complex mass-produced consumer product ever made. A typical car is composed of more than 20,000 parts, provided by about 200 different suppliers that must all deliver the parts to the factory "just in time."
FIVE-DAY CAR. The auto industry has already made strides in computerizing the design and production process. By using tools such as product-development-management software (PDM) and computer-aided design/computer-aided manufacturing/computer-aided engineering (CAD/CAM/CAE), it has reduced the time it takes to bring a new model to the market from 5 years to about 18 months. Putting a car together used to take from 30 to 40 hours. Now it takes fewer than 20.
Hooking it all together on the Web is the next step. By speeding communication through the entire process, from the design to showroom, introducing a new model can quickly be cut to a year or less. Toyota, for one, is shooting for a five-day car, from idea to finish. "The overall strategy is to reduce new-product introduction times," says Michael Burkett, an e-business manufacturing analyst at AMR Research in Boston.
Advances in Internet technology have raised the speed limit, such as the amount of data that can be transmitted over the Web. "The lack of a virtual Web environment didn't allow simultaneous users and real-time interactivity," says Michael J. Kidder, director of marketing at Altair Engineering in Troy, Mich. "Today these are ceasing to be obstacles."
TEAM WORK. Indeed, producers of manufacturing software are rushing to make their design and engineering programs run securely over the Web. And the carmakers are quickly forming strategic alliances with them. GM recently inked a $13 million deal with Unigraphics Solutions. Ford has teamed with SDRC. And DaimlerChrysler is partnering with France's Dassault Systemes, which offers a program called CATIA, for "computer-aided, three-dimensional, interactive application." Says AMR's Burkett: "I'd put Detroit's investment in Web-enabled systems in the $1 billion-plus range over the next several years."
When all the systems are connected, teams of engineers located around the world will be able to communicate by voice while viewing a part -- or an entire car -- on their computer screens. Each will be able to make changes that can be seen by their colleagues. The design is tested in a virtual car on a virtual test track. Engineers will be able to watch simulated performance in various conditions, such as rain, in 3-D. Parts specifications will be sent directly to the toolmaker, who will be part of the team.
"You eliminate hard production tools by designing the digital car," says Scott F. Merlis, an analyst at Wasserstein Perella Securities in New York who coined the term E2E (engineer to engineer) to describe the collaborative design process. "An engineer can depress a virtual brake pedal in Stuttgart, and others in Detroit or Tokyo can watch the calipers close to stop the car. These systems can manage thousands of design changes."
NEW BENCHMARK. A harbinger of what's to come may be the World Car Project. Last spring, three teams of automotive designers and engineers on three continents developed the European Roadster Challenge (EUROC) race car in just seven days. A team in Europe designed the chassis, while a team in Japan designed the body, and a U.S.-based group created the power train.
Admittedly, the teams worked by selecting or modifying existing parts. But their feat established a benchmark in fast-turnaround auto design. "No one truly starts from scratch in designing any large product," notes Wayne George, senior vice-president at PTC (formerly Parametric Technologies Corp.) in Waltham, Mass., which markets a program called Windchill that enabled the developers to collaborate on the Internet in real time.
One of the most ambitious efforts to reinvent Motown is a DaimlerChrysler project called FastCar. The company is linking not just design, engineering, and manufacturing but also quality control, finance, procurement and supply, sales, and marketing into one seamless web. Any decision made will be passed immediately across the entire chain. "Right now, information moves along from point to point so everyone downstream is working with bad information," says Gary E. Dilts, senior vice-president of DaimlerChrysler's EConnect Platform.
EVERYBODY KNOWS. Today, if a designer specifies a new seat fabric, it may take weeks for the fabric maker to learn of the change. In the meantime, the mill continues to churn out the old fabric. Then the supplier has to change over its looms, and more time will pass before seats covered in the new material show up on the assembly line.
When the FastCar project is completed over the next several years, some 4,000 internal and 5,000 external users will have access to the interactive, 3-D "homepage" and all the data behind it. Dilts expects that the hyper communications will yield a huge payoff. "This will allow 12 people to look at a decision at once, not one by one," he says. "It will take time and money out of the process of making automobiles."
Merlis of Wasserstein Perella couldn't agree more. He predicts that by going online, auto makers will cut their product development time in half and chop the cost of making a vehicle by an average of between $900 and $1,300 over the next 5 years. The overall savings to the global Big Three? Merlis pegs it at a cool $18.5 billion by 2005. "The supply chain is suddenly becoming a value chain," he says. "Everyone, from the top tier to the third tier of suppliers will be tied directly into the design process."
CUSTOMIZED MODELS. But the biggest beneficiaries of a more nimble Detroit are likely to be anyone who purchases a car. "The integration of the Internet will change how the auto industry interacts with its customers," says Zahed Siddique, an assistant professor of engineering at the University of Oklahoma.
Communication will flow upward from the marketplace as rapidly as it travels downstream to the production line. Large fleet owners, such as Hertz, Avis, or the military, can be brought directly into the design process. Production can be matched to demand. And customized models can be quickly delivered to dealers. "The biggest effect on the bottom line is when you create a new product that everyone wants, and you can get it to the market on time," says PTC's Wayne George.
After all, why do we buy a new car every few years in an era where an auto can be well over a decade old and still not be worn out? The answer says Chris Bangle, chief of design at BMW in Munich, is software. "Hardware is an engine and a drive train -- its horsepower," he says. "Software is what it does for you." And those are emotional issues -- a racy convertible or a sport-utility vehicle, design and color, the smell of leather.
"The ramifications of much shorter development times will make the automobile even more a fashion accessory than it is today," predicts John Moore, vice-president of ARC Advisory Group in Dedham, Mass. And, who knows, it might even create a sales boom. Small wonder carmakers are putting theal to the metal.
By Alan Hall in New York Edited by Douglas Harbrecht
Copyright 2000, by The McGraw-Hill Companies Inc. All rights reserved.
Printer-Friendly Version
