The Future of the Auto Industry Really Is Now

Paul Eichenberg is a consultant. What makes him different from many consultants to the auto industry is that his knowledge isn’t based solely on case studies, but he actually spent some 25 years in the supplier world, with his last direct position as vice president of corporate development and strategy for Magna, where he did such things as managed the integration of Magna Electronics into Magna Powertrain.

Now you might think that consultants are good at generating heat and not a whole lot of light.

But on what is a very special edition of “Autoline After Hours” Eichenberg provides some exceedingly high lumens as he explains what is going on in the global auto industry (and the word global isn’t being used here without basis: the week before the show Eichenberg was in Europe, and when we tried to get him on earlier this year, he was in China).

One of the things that he talks about in detail and length is the increasing transition—particularly in China and Europe—toward electric vehicles.

 

The transition to electric vehicles has some rather significant implications for suppliers. (Image: Volkswagen AG)

The show was shot the afternoon before the official morning announcement by Volkswagen and Ford that (1) Ford would become a customer for the VW MEB electric vehicle platform and (2) Volkswagen is investing in Argo AI, the autonomous vehicle technology developer that Ford invested $1-billion in two years ago.

And even though that announcement hadn’t been made, Eichenberg, based on questioning by Joe White of Reuters, Autoline’s John McElroy and me, details the implication of the MEB platform for the auto industry overall, noting the significant number of vehicles that Volkswagen and Ford account for globally.

In Eichenberg’s estimation, suppliers that aren’t supplying to the MEB platform are going to be in trouble—and that’s based on the notion that the suppliers are in a position to actually be providing content to an electric vehicle platform rather than traditional internal combustion engine-based vehicles.

Eichenberg believes that going forward traditional suppliers are going to find decreased opportunities if they’re not aligning their capabilities with an industry that is becoming more electrified (all the way to full electric) and one where the vehicles are increasingly networked and automated.

While this is the sort of thing that one might imagine a consultant might say, what’s notable about this discussion with Eichenberg is that he bases his observations on actual information that he and his colleagues at Paul Eichenberg Strategic Consulting have obtained.

Oh, and one more thing. Eichenberg is also a columnist for Automotive Design & Production.

You can see the show here.