At the Geneva motor show some years back I attended a dinner with Volkswagen chairman Dr Ferdinand Piech. You don’t get many laughs from Dr Piech, but you do learn a lot.
Asked about his vision of the group at the end of the century, he took a long pause for thought, then declared, among other things, that VW would be selling 5 million cars a year.
It seemed a fanciful aim because the group had just reported record annual sales — of 3.4 million vehicles. To hit 5 million would require VW to grow at an average of nearly 7% a year for each of the following eight years.
Piech was true to his word. VW sold nearly 5.2 million vehicles world-wide last year, another record. Memories of that dinner flooded back on a recent visit to VW’s headquarters in Wolfsburg. This time, the chairman made surprising predictions about the use of electronics in cars.
‘Electronics and software will play a major role in around 90% of future innovations in vehicles,’ said Piech. Electronics and software will account for 30% of a vehicle’s manufacturing cost in the next five years, he added.
In other words, the car is being transformed into a powerful computer held together by a metal box. The message is that mechanical and electrical engineering have more or less reached maturity. Electronics will dictate the sector’s future.
All vehicle and components manufacturers are investing in electronic innovations, and higher volumes will make them cheaper. Electronics now found only in expensive models will appear across the ranges, just as disc brakes and turbochargers did a generation ago.
New electronics technology includes smart cruise controls to maintain vehicle distances, parking aids, skid-prevention systems, assisted emergency braking, cam-less engines, drive-by-wire controls, internet facilities, real-time route planning and traffic information, and remote vehicle-monitoring systems.
But the sobering aspect is that more electronics research will be carried out outside this country, because foreign-owned vehicle makers and components suppliers operating in the UK prefer to do such work in their home countries. A UK engineer wanting to work in the automotive sector will have to move.
The loss of an indigenous automotive industry was bad enough. But Piech’s comments imply that the country will suffer an intellectual hollowing as well.
Richard Feast is editor-at-large for Automotive World.