Exploring strategic automotive partnerships in the software-defined vehicle era

The advent of software-defined vehicles and other innovative technologies is significantly reshaping the relationships between OEMs and suppliers. For starters, it’s making strategic partnerships more important than ever before as OEMs strive to improve efficiencies in product development and bring innovations to market faster. Here Robin Milavec, President, Chief Technology Officer, Chief Strategy Officer and Executive Board Director of Nexteer Automotive, takes a deeper dive into the evolving nature of these partnerships and technologies, as well as the implications for OEMs and suppliers – and consumers.

Q: In the era of software-defined vehicles (SDVs), what best practices are key to a successful strategic partnership between OEMs and their suppliers?
 

Robin Milavec: OEMs and Tier 1 suppliers have a strong history of collaboration as Tier 1s have traditionally been a center of innovation for vehicle sub-systems. But the convergence of megatrends like electrification, software, connectivity and more is driving OEMs and Tier 1s to find ways to offset growing complexities, especially in software, by simplifying and standardizing in other areas. This makes agility critical to successful partnerships.

Focusing on customers’ wants and needs will also be important to success in future mobility applications. The transition to electric vehicles (EVs) provides an opportunity to start from a “clean sheet,” where OEMs can rethink and modernize electrical and electronic architectures to enable new features and meet rapidly changing consumer expectations.

In addition, transparency and efficiency are keys to any successful partnership. At Nexteer, we act as an extension of our OEM customers’ teams to support their software business goals, drive efficiencies and help bring their SDVs to market faster. To do this, we focus on developing innovative solutions with speed, flexibility and seamless vehicle integration from concept and design to development and validation.

Q: How is software changing the ways OEMs and suppliers collaborate to design and develop the vehicle?
 

Milavec: Strategic partnerships between OEMs and Tier 1s are more important than ever as new software-driven business models evolve alongside new software-enabled functions. As OEMs shift to centralized architectures, they want more ownership of the software that’s integrated into vehicles’ subsystems and are core to their brands, such as the steering functions. Nexteer is evolving our software partnership approaches and collaborating with customers in a very open and transparent way to support these needs.

By working together in a more collaborative way, OEMs and suppliers are better able to drive efficiencies in software engineering by maintaining common software systems across vehicle platforms. This enables easier technology integration and updates, while also providing flexibility to support OEMs’ brand-diversification needs. This level of transparency and agility will enable OEMs to bring their SDVs to market faster.

Q: In the transition to SDVs, one obvious parallel is the evolution of the smartphone. What lessons from the smartphone industry can OEMs and suppliers learn as they shift from hardware to software-driven products?
 

Milavec: One of the key lessons is the need to create fast, iterative software-development cycles. These cycles create a continuous development loop that supports shorter timelines and accelerated development, as software is no longer restrained by hardware-development timelines.

For example, think of the sheer number of apps that are now available for smartphones. In future SDVs, OEMs and suppliers will have the same opportunity to deliver new, on-demand features for drivers. This means that introducing new content and features doesn’t have to stop at the end of the production line. New features and/or updates can be introduced to vehicles already on the road, which will help automakers strengthen brand loyalty, enhance the driver experience and improve quality.

Q: If this greater emphasis on software requires more collaboration, does that also require greater standardization in the underlying development platforms – the auto industry’s version of iOS and Android?
 

Milavec: SDVs are driving an evolution in electrical architectures that enables hardware to be standardized and the software to reside in a centralized domain, instead of in a sub-system like steering. This separation leads to centralized “operating zone systems.” Within these zones, middleware acts like a universal communicator between software, hardware and the operating system.

On the standardization front, Nexteer has developed standardized software that resides in an OEM’s centralized domain-control unit, which controls multiple actuators across vehicle subsystems, such as steering and others. This enables a more efficient system-to-system integration of the electronic chassis components in the vehicle.

This industry trend toward centralizing domain controllers enables efficient over-the-air updates across different vehicle platforms. In turn, this creates new possibilities for OEMs to extend vehicle platform and hardware lifespans, offset costs and complexity by reducing the number of electronic control units (ECUs) and wiring harnesses and introduce new features and functions without waiting for mid-cycle enhancements or new vehicle launches.

Software also is a driving force for standardization in hardware, especially in advanced technologies like steer-by-wire. This allows OEMs to program component software to feel different across various vehicles, such as a luxury SUV, a pickup truck or a sports car – even if the same steering system hardware is used across different vehicles.

Q: How will innovation processes change, given this greater reliance on software and the need for partnerships? Will future research and development increasingly come from partnerships versus individual companies?
 

Milavec: The importance of partnerships cannot be overstated. Software is quickly becoming the main driver of new safety, performance and convenience features and OEM requirements are expanding. At the same time, there simply are not enough software engineers to meet the demand within and beyond the automotive sector. The only way to achieve SDVs with a profitable, sustainable business model is through partnerships.

Here’s a good example: OEMs may not have the in-house bandwidth or system integration know-how to efficiently develop a necessary technology on their own, while also meeting tight timelines and various safety requirements across international markets. But this is where partners with specialized expertise and agile development processes – like Nexteer with its advanced motion control – can help OEMs efficiently design, develop, test and seamlessly integrate software.

In addition, partnerships with industry peers will also drive future innovations. For example, our collaboration with Tactile Mobility has led to the development of software that can improve vehicle health management. The Nexteer team values our strategic OEM and technology partnerships as we work together to accelerate future mobility to be safe, green and exciting.

About the Panelist
Robin Milavec
President, Chief Technology Officer, Chief Strategy Officer and Executive Board Director, Nexteer Automotive

Milavec spearheads the strategic direction of Nexteer and ensures its technology roadmap aligns with industry megatrends to proactively capture growth opportunities. Nexteer is a global leader in motion control technology. To learn more, visit www.Nexteer.com.