Quad Fours, Hemi Six-Packs, Rocket V-8s. Powerplants have long been sources of pride for automakers, symbols of engineering prowess.
But such pride is an expensive luxury in today's crowded, cost-obsessed auto industry.
Engine development, particularly in risk-laden emerging markets and noncore niches such as light-duty diesels and alternative-fuel vehicles, is a ravenous cash hog. A new engine is a billion-dollar commitment, driven in part by constricting weight, emissions and fuel-economy targets. These requirements have overwhelmed the old technologies and forced automakers back to their drawing boards.
Design and manufacturing responsibility for more and more major vehicle subsystems has gone to suppliers, and some companies believe engines are heading down this road.
'Fundamentally, the OEMs want to do everything quicker, cheaper and better,' says one supplier executive. 'One of the best ways to do that is to buy somebody else's proven technology and use it.'
Heavy-duty diesel engine makers have had some success penetrating the U.S. light-vehicle market with complete engines. For example, Navistar International Corp. supplies diesel V-8s for the Ford F-series pickup and will develop a smaller diesel V-6 under a pact with Ford Motor Co. set to last until 2012.
'We've found such a wide breadth of applications at Ford that we are not looking for other sources of (light-duty) business,' says Patrick Charbonneau, vice president of engine engineering for Navistar.
In Europe, suppliers take even more of an active role in powertrain development. Automaker engineering staffs are smaller there, and megavendors such as Robert Bosch GmbH and Siemens AG are spearheading research into new engine technology such as high-pressure common-rail direct injection.
It is no accident that the continent is home to most of the world's top engine consulting firms and their North American subsidiaries, including FEV Engine Technology of Germany, AVL Powertrain Engineering Inc. of Austria and Cosworth Engineering Inc. and Ricardo Inc. from the United Kingdom.
In contrast, Americans still have 'a strong desire to own all the bragging rights' to a powertrain, says David Hudson, technical director for business development at Ricardo in Belleville, Mich.
But several factors work against this:
Big 3 engineering staffs are mainly organized to do conventional, high-volume, gasoline-fueled engine programs. 'The small stuff (such as diesels) just gets in the way,' says Hudson.
Automotive safety and emissions standards are becoming more similar between the United States and Europe. That gives domestic automakers an incentive to commonize powertrains and tap European engineering resources.
Suppliers are developing the capability to provide complete systems, especially as they are increasingly being asked to 'share the risk' in emerging markets. That means taking a greater stake in the development and manufacturing of a vehicle.
For example, Ford Motor Co.'s planned Amazon Project in Porto Alegre, Brazil, will rely heavily on suppliers to furnish complete systems for a small sedan and small sport-utility. Following a pattern set by Volkswagen AG and Daimler-Benz AG, some of Amazon's suppliers will be in Ford's assembly plant.
'As a (powertrain component supplier) can demonstrate more capability, I think the OEMs will take it,' says Mitch Wetzler, CEO of Cosworth Engineering North America in Novi, Mich.
Although Cosworth is best known for its limited-production, high-performance engines, most of its work today is on core engine areas. Wetzler says more than 75 percent of Cosworth's billable hours are devoted to fuel economy and emissions research.
Also, an increasing amount of Cosworth's future business could come from Tier 1 suppliers rather than the automakers, says Wetzler. Some Tier 1 suppliers have aggressive growth plans. 'They will have to be in high-value subsystems if they're going to meet those goals,' he says.
But how much the U.S. auto industry spends on engine outsourcing is tough to determine. In a statement, Ford Motor Co. says it has added 600 engineers to its powertrain program and is moving some component sourcing inside. But suppliers insist the amount and scope of outsourcing are expanding, and they are bullish on the future.
'We used to just supply a $5 timing chain for an automaker to put together a timing system,' says John Fiedler, chairman and CEO of Borg-Warner Automotive Inc. in Chicago. 'Now we're selling them an $80 timing system that we developed.'
Fiedler says the Big 3 have encouraged their suppliers to grow into full-service systems providers, and their payouts have grown accordingly. Sales of Borg-Warner's powertrain systems components grew 8 percent last year despite the 1996 sale of its $100 million manual transmission business to a Mexican supplier.
The automakers 'want their suppliers to be an extension of their engineering programs,' says Charles Freese, chief engineer for Detroit Diesel Corp.'s advanced automotive engine program.
The company will supply a diesel engine for Chrysler's Brazilian Dakota through its Italian small-engine subsidiary, VM-Motori S.p.A., which it bought in 1995. VM also supplies complete passenger-car diesel engines in Europe to Chrysler, Rover and Fiat.
Even though Detroit Diesel's automotive business is still a small niche, 'We're positioning ourselves to offer any amount of service to our automotive customers,' says Freese.
Will automakers ever call on suppliers to build higher-volume engines for them? 'I wouldn't say that we wouldn't do it,' says Borg-Warner's Fiedler. 'We just haven't been given the opportunity yet.'
Cosworth's Wetzler believes the trend is inevitable, particularly as suppliers seek out more value-added business and automakers come to view their engines less as symbols of ability and more as commodities with increasingly comparable technology, reliability and power.
'It really depends on whether you can make the case that powertrains are competitive discriminators in the marketplace,' he says.
'Right now the OEs see it as a product discriminator. Whether the consumer continues to see it that way remains to be seen.'
Automotive News Staff Reporter Aaron Robinson is based in Detroit