Auto suppliers warn of supply chain risks Continued ‘vertical integration’ reshapes industry landscape

The 2022 International Consumer Electronics Show CES, which is being held in Las Vegas, USA, has become a stage for auto companies and technology companies to showcase their latest autonomous driving technologies. Dozens of automakers and tech companies have announced partnerships, and traditional automakers, including General Motors, have accelerated their embrace of electrification with plans to produce consumer-grade autonomous vehicles.

However, the new crown epidemic has superimposed the global supply chain crisis, and auto suppliers expect that 2022 will still be a difficult year for the global auto industry. “While we think supply chain issues will definitely improve this year, there are still too many uncertainties, such as some raw materials in the supply chain that are simply not available, and we are currently rebuilding inventory levels.” Auto technology provider Aptiv Global Senior Vice President and Chief Technology Officer Glen De Vos told Yicai Global.

Aptiv is one of the few auto tech companies still participating in this year’s CES offline show. In a remote video interview with a reporter from China Business News at the exhibition site, De Vos expressed his views on the recent supply chain issues in the automotive industry and the progress of autonomous driving technology.

With the gradual easing of the lockdown measures brought about by the new crown epidemic, De Vos expects that the shortage of the automotive supply chain will definitely improve in 2022. At present, the company is moving from reactive response to active management, but there are still some uncertainties.

“We have only just begun to rebuild the inventory level, especially the inventory of the semiconductor supply chain. Because these inventories have indeed been depleted before, it will take a long time to build the inventory.” He told the first financial reporter, “The real recovery in the supply chain Before inventory levels, any disruption will have the ultimate impact on our customers.”

As one of Tesla’s suppliers, Aptiv provides automotive autonomous driving technologies including area controllers, millimeter-wave radar, and supports the implementation of software-defined vehicles.

Last year, Tesla announced that it would abandon the use of radar sensors in the assisted driving AutoPilot system of Model 3 (Configuration | Inquiry) and Model Y (Configuration | Inquiry) vehicles in the North American market, and instead focus on camera vision-centric solutions plan.

In this regard, De Vos told the first financial reporter: “Automotive vision has huge capabilities, but it also has limitations. We think that using vision in combination with radar will be more effective and can really provide better and more powerful than just using vision. perception system.”

Tesla’s move away from car radar has also saved costs for its vehicles, and using fewer parts has allowed it to navigate supply chain crises better than its rivals. Tesla is able to do this because of its high degree of vertical integration. Unlike traditional automakers who are still highly dependent on suppliers, Tesla designs a lot of hardware and writes a lot of software itself, which is also the basis for the company’s ability to control the supply chain more flexibly.

Volkswagen Group CEO Herbert Diess once organized a meeting to invite Musk to share his management experience with Volkswagen executives. Musk described Tesla’s electric cars as “computers on wheels” and said Tesla had incredible “vertical integration”, such as most of the complex car software designed by Tesla’s in-house engineers, And being able to modify the software in time to accommodate different chips has successfully helped Tesla deal with issues like chip shortages.

Yang Xiaoming, president of Aptiv Asia Pacific, told the First Financial Reporter: “The relationship between automakers and suppliers is undergoing profound changes with the development of vehicle electrification, and software-defined vehicles have become the general trend.”

Yang Xiaoming believes that in addition to the new crown epidemic, another important factor leading to the shortage of the automotive industry supply chain is that the transformation of the automotive industry has reshaped the pattern of the traditional automotive supply chain. “With the intensification of trends such as software-defined cars, it has an impact on the amount of automotive chips, which increases the challenges of the supply chain.” He told Yicai.com, “We have taken many measures to quickly respond to challenges, such as accelerating Localization strategy layout.”

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Author: Yoyokuo