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How Bosch adapted to Chinese startup Byton's faster timeline
Lindsay Chappell | 2018/12/21

Auto industry veteran Sujit Jain is adopting some new work habits these days. It seems one of Jain's new customers wants him to work a little faster.

"I've been in this business for 30 years," the president of powertrain solutions for passenger cars and electric vehicles for Bosch USA, says with some amusement. "I've worked successfully with most of the world's traditional OEMs. But I'm seeing a change right before my eyes. "The new startups of the world want you to work faster, move faster, make decisions faster and deliver solutions faster."

Bosch, the world's largest supplier of parts to automakers, with 2017 sales of $47.5 billion, is engaged in a project with Byton, a little-known Chinese electric vehicle startup formed by a trio of Chinese billionaires through a venture called Future Mobility.

Byton is attempting to do things in new ways -- for starters, going from idea to market with a new brand and new passenger vehicle in just three years. But what might be the most significant departure from industry tradition is what Byton is doing with Bosch: Byton has contracted with Bosch to create its entire electric powertrain for its vehicle.

That is radical thinking in an industry where engines, horsepower, engine blocks and engine sounds have long been the carefully guarded trademarks of the brands that use them.

But Byton isn't hung up about all that history. And so it has retained a global supplier to figure out how to make its vehicles move.

We could have done the powertrain development in house," said Dirk Abendroth, one of the architects of Byton's vehicle as the startup's vice president for autonomous driving and powertrain. "But is that really necessary to differentiate the vehicle? We decided that the powertrain was not the chief factor in positioning our company.

"Don't get me wrong," he clarifies. "Powertrains are and always will be a significant portion of a customer's perception. And the breakdown of an engine is still the ultimate disaster for a vehicle owner. But in the new world of electric vehicles, the powertrain will not be the differentiating attribute."

It's about time
But there was a bigger issue behind Byton's decision to enlist a supplier to create its powertrain, says Abendroth, who will be leaving the venture at year end to become chief technology officer at Continental. The true motivation for turning to Bosch was the same issue that is changing routines for Bosch executive Jain: time.

Byton wanted its vehicle developed fast. Faster than vehicle developments normally take.

To explain the startup's thinking, Abendroth tells this story:

Abendroth was recruited to the Chinese venture from a career of nearly 12 years with BMW in Germany, where he was most recently head of the BMWi electric powertrain program. Byton also recruited BMW's vice president of engineering, Carsten Breitfeld, to become CEO.

When Breitfeld and Abendroth laid out their plan for developing a vehicle for Byton, the startup's founders -- men from backgrounds in consumer electronics, software and services -- heard the Europeans say that a typical vehicle development program took six to seven years.

The Chinese investors went into a private meeting room to huddle about that information. They came back admitting that they were perplexed. "They told us that, in their industries, new products were developed in only one year," Abendroth recalls. "They wanted us to move faster."

China's open window
The Byton project is predicated on getting to market in China before a slew of other automakers get there, Abendroth explains. By some estimates, there are "hundreds" of ventures plotting a move on the promising Chinese EV market, including such major international automakers as General Motors and Volkswagen.

Byton wanted to get there immediately.

Using Bosch was an easy play for the former BMW executives, who had crossed paths with the German mega-supplier for years. And Bosch is no newcomer to EVs, Jain points out.

"We are a leader in e-mobility around the world," Jain said. "This was no accident. Bosch has been investing up to $500 million every year for the past eight or nine years in our e-mobility capabilities to put ourselves in this position. As a result, we have developed the components that can drive it -- the power electronics, the battery management systems, the e-machines or motors, and also the systems competence to be able to integrate it all."

When the Bosch-Byton deal went public in September, it followed Bosch's move in January to reorganize all of its global powertrain assets, products and management. In the past, Bosch powertrain was divided between gasoline products and diesel products. Last year, electric vehicle technology was folded into the same new management structure.

But Bosch has stiff competition. Canadian supplier giant Magna International is also developing an electric powertrain for China's Beijing Automotive Industry Holding. And it is co-developing an EV powertrain with a Chinese partner to supply to an unidentified German automaker in China.

New behaviors
"I truly believe that Tier 1 suppliers will be even stronger in powertrain in the future," Abendroth says of the trend. "Automakers can instead concentrate on systems integration, user interface and connectivity." That will make for faster development, he believes.

Jain says the idea of speeding up development has caused Bosch to "change our way of working with these new companies, because they think differently. "We've had to become more agile," he says.

To help expedite the work, Jain has taken on what is for him the unusual role of weekly project monitor on the Byton business. Twice a week, he convenes a stand-up meeting in his office in suburban Detroit to go over project specifics with managers. "What needs to be done with this project?" he asks the participants. "Have you done it? And what can we get done in the next few days?"

Other customers now want expedited program management, too, he says. "We are working with new startups in Europe and China," he adds. "It's changing us."

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