Back in the days automotive companies would focus on their own individual projects. However, lately the trend is for major manufacturers to work together either with one another or with software companies in order to develop innovative new technology. The result are cars that are more efficient and technology that is more cutting edge than ever before.
A good example of partnership creation in order to open new markets is what has happened in China. That country, with the largest population on earth, became a major target of auto manufacturers in the U.S., Europe and Asia. At the same time, the Chinese government was taking major steps to develop that country’s own auto industry. Each side knew that they could help the other. So major partnerships were created between Chinese and European, American and Asian auto manufacturers. The auto manufacturers from Europe, America and Asia used the Chinese companies as a conduit to sell their cars in the Chinese market. In return, they assisted the Chinese auto makers to develop their own vehicles. Today China is the largest auto market on Earth and just about every major brand of car is sold there.
Next came the issue of new technologies. In the old days the auto manufacturers developed their own technologies. Now they are creating partnerships with such companies as Microsoft, Gracenote, NAVTEQ, Nuance Communication, Sony Corporation, TeleNav, ViaMichelin and others to help them create new technologies. The result, for example, are infotainment systems like the Ford Sync and MyFord Touch which was developed through a collaboration between Ford and Microsoft. Microsoft has since developed partnerships with other car manufacturers to help them create their own infotainment systems. These infotainment systems are using technologies developed by Gracenote, NAVTEQ, Nuance Communication, Sony Corporation, TeleNav and ViaMichelin. Gracenote is providing upgraded music entertainment, NAVTEQ the maps, traffic and location data for the navigation systems, Nuance Communications is offering the voice recognition technology so that the driver can control elements of the car via voice command. Audio manufacturers like Sony are creating the super sophisticated audio and audio-video systems that are now appearing in cars. TeleNav, known as the largest global wireless navigation services provider, is supplying the technology that connects navigation in the car to GPS. ViaMichelin makes the Michelin hotel and restaurant guides accessible to drivers and their passengers.
Auto manufacturers also have to tackle the development of new technologies that assist in improving fuel efficiency. So they have formed partnerships or joint ventures among themselves in order to share the cost. So we are seeing Daimler, the parent company of Mercedes-Benz, partnering with Chinese battery and auto maker BYD to help in the development of electric vehicle technologies. PSA Peugeot Citroen is known worldwide as an expert in diesel technology. It has partnered with Japanese auto maker Mitsubishi to produce electric cars. Volkswagen partnered with Porsche to help the luxury car maker develop high performance engines that meet environmental regulations. Later Volkswagen acquired Porsche.
When auto makers finally decided to develop electric cars, partnerships were formed to develop the technology. General Motors and Ford joined with South Korean battery manufacturer LG to develop and supply them with the next generation lithium-ion batteries used to energize electric cars. Moreover, General Motors and Reva have partnered to produce a zero emission car for India. In addition, Daimler became the first major auto maker to buy a stake in Tesla Motors, an electric car manufacturer.
Volkswagen has purchased a percentage of Suzuki and Suzuki has acquired shares of Volkswagen in a move that is helping both companies. Suzuki is getting access to VW’s technologies and Volkswagen is using Suzuki’s expertise to enhance its small car production.
As a result of the recession automotive companies are working together and the results are spectacular. Let’s hope that this trend of team work will continue in the future.