Headlights are getting smart. They're not just putting a different face on the front of a car - the next generation of headlamps will have brains. As headlights undergo the biggest revolution since the arrival of the sealed beam unit a half-century ago, the company with the best technology will win.
The costly technology battle is expected to trigger a shakeout. The first blow came last year, when the lighting divisions of Robert Bosch GmbH of Germany and Fiat Group's Magneti Marelli formed a joint venture called Automotive Lighting.
Meanwhile, General Motors has spun off its lighting operation, now called Guide Corp. And Ford Motor Co. is expected to follow suit when it spins off Visteon Automotive Systems.
'It is likely that further joint ventures will happen in this process,' said Ulrich Koster, chief spokesman at Germany's Hella KG Hueck & Co. 'We assume that there may be a shakeout in the next couple of years.'
The shakeout is likely to occur after the automakers choose suppliers to provide 'smart' headlamps. At the moment, Hella and Valeo appear to be leading the race to introduce this technology.
Hella's smart headlamps will debut next year on the BMW 7-series sedan. Jaguar engineers describe headlights as 'an area that is flourishing both in design and technology,' will follow BMW closely. The British automaker is working with Hella and other suppliers.
The new generation of lighting will help drivers see around corners. Headlamps will adjust the beam pattern automatically to suit different driving conditions. The headlamps will project a long, narrow beam for high-speed journeys and a short, fat beam in low-speed, urban areas.
The full benefit of these advanced systems will not be realized until European regulations are changed. Most likely, this will occur sometime after 2002.
However, existing regulations will allow BMW to introduce headlamps with adjustable beams on its 7-series sedan next year. The world's top lighting suppliers - Valeo, Visteon, Hella and Automotive Lighting - are developing smart headlamps. The suppliers say they are anticipating the needs of their customers.
Automakers want to offer technological improvements that are obvious to the motorist, said Hector Fratty, research and development director for Valeo's lighting division. A recent consumer survey concluded that motorists would like to try smart headlights, Fratty noted.
'Drivers wish to improve their night vision in three primary driving conditions: bad weather, country roads and driving into bends,' he said.
The survey was done for Advanced Front Lighting Systems, an organization of European carmakers, suppliers and government agencies.
Last year, the members of this European coalition built seven prototype vehicles to test their headlamps. The coalition is likely to set future lighting regulations for Europe in 2003. There will, of course, be a price premium. Luxury-car headlamps typically cost $80 or so, said Jeff Erion, manager of advanced lighting technologies at Visteon. Automakers will hesitate to pay more than $25 to $35 extra for the new headlamps, Erion predicted.
'We'd like to keep the added premium to $20, but it's a stretch goal,' he said. 'That's going to make it tough.'
Others say the new technology will cost more than Erion's estimate - at least initially. But Erion and other industry experts agree that the European market will accept the new headlamps before the more cost-conscious North American market.
Fritz Wilke, head of Automotive Lighting's business development, predicts customers will be willing to pay a premium for the new technology.
'While component prices cannot increase indefinitely, the new technology will certainly separate itself from standard headlamps as an option.'
Here's a snapshot of how some of the front-runners are shaping up.
Valeo's product - dubbed Expert Lighting - has two primary functions. The first is a low beam that adapts to curves. This feature will have to wait until new European regulations are issued.
Inside the headlamp, Valeo has installed movable reflectors that rotate according to the position of the steering wheel. The additional beam illuminates the area at or beyond the curve.
The second function is an adaptive high beam. Additional mirrors within the high-beam reflector adjust the width and length of the beam. This gives the motorist a wide beam at low speeds, and a longer, narrower beam at highway speeds.
The system being developed by Automotive Lighting is subtly different. A cluster of lights with bulbs facing different directions replaces the one or two lights.
The pool of light cast by this headlamp can be adjusted to cope with changing road conditions. The headlamp even adapts to different weather conditions such as snow, fog or rain. As with the Valeo system, Automotive Lighting's headlamp can adapt to speed and steering angle.
Wilke said the company also is working to combine its intelligent headlamp with a satellite navigation system. That will allow the headlamp to offer the best illumination for the situation ahead.
Hella's headlamp uses digitized road maps from GPS satellites to pinpoint the vehicle's location. By calculating the car's speed, the system anticipates upcoming curves and intersections.
This allows the headlamp to adjust its beams even before entering a bend.
To adjust the headlamp beam, Hella designed a shield that moves between the light bulb and glass lens. The effect is comparable to a slide projector: The shield's shape creates the appropriate beam.
Visteon is developing its own smart headlamp, too. The company expects to have its own version ready for the 2004 model year.
Europe, Japan and North America are likely to use sophisticated automatic headlamps first, while developing markets continue to use obsolete sealed-beam headlamps.
But as the cost of the new technology declines, smart headlamps will spread to mass-market vehicles. And when that happens, suppliers that trail behind on technology will be the losers.
A handful of companies appear to be in the running. At the top is Valeo, the world's largest headlamp supplier with 17 percent of world sales. Trailing Valeo are Koito, Hella and Guide. These suppliers have encountered a formidable rival - Automotive Lighting, the Bosch-Magneti Marelli joint venture that was announced in September.
Previously, the lighting division of Robert Bosch GmbH had been No. 5 in the world rankings and Magneti Marelli No. 8. Now the 50-50 joint venture claims it is No. 2 overall.
With 11 plants and eight technical centers worldwide, the partners enjoy a genuine global reach. That was a major impetus for both partners, Wilke said.
'We recognized early on that an extended presence was required to support the worldwide activities of our customers,' Wilke said.
The venture combines the technology and quality of Bosch with the design flair of Magneti Marelli. The product portfolio and customer base also was a good fit. The Italian partner has a strong lineup of rear lights, while Bosch has expertise in headlights.
Top management includes four former Marelli and five former Bosch managers. In 1999, Automotive Lighting's revenue totaled 740 million euros ($751 million), and this year it expects to boost revenues 3.9 percent.
Automotive Lighting and its rivals clearly are counting on smart headlamps to boost revenues. Said Visteon's Erion: 'This is the biggest thing going on in automotive lighting.'