Suppliers Need to Realign Capacity for BEVs, Ford Says

Even before the COVID-19 pandemic hit, the auto industry’s shift to EVs was putting its supply chain through a nearly unprecedented period of change.

Amidst all of the upheaval and new technologies, some suppliers will find that an openness to new ways of doing things can set them up for success, especially if they’ve already started adapting.
New suppliers are entering the industry to provide components for electric vehicles even as automakers are still building internal-combustion models, a situation that will result in overcapacity in the near term, says Ford global engineering director Frank Abkenar.

Abkenar (pictured below, left) was a panelist during a recent discussion on “What Are Automakers Looking for from the Supply Chain?” during Informa’s Automotive Tech Week in Novi, MI.

“As the OEMs realign their capacities, the supplier base needs to do the same,” he says. “This means that some suppliers will decide to exit ICE commodities and others stay and will look at an opportunity for consolidation that’s inevitable in this space. Having said that, many suppliers can actually use their existing capabilities and know-how to operate in the BEV space.”
ZF is in the middle of making just this change. The company built its first motors for automotive powertrains back in 2008 and said two years ago it would not develop any more new transmissions for ICE-only models.

Drew Winter.Frank Abkenar Ford 2020 10 Best EPS - Copy_0

ZF components can be found on millions of vehicles around the world, says Michael Ebenhoch, ZF’s head of development for electrified powertrain technology, and also a panelist in the discussion. He says the supplier’s vast experience has prepared it well for the shift to electrification.
“Looking at things like iron casting or cooling, they are all capabilities and competencies that you also need for efficient electric drivetrains,” Ebenhoch says.

“But we have to go further, looking at systems and software, which we already have in our program. We will utilize this not only for the BEVs and PHEVs, but for all vehicles and mobility services which we will provide in the future.”

Some of the changes will require bigger adjustments than others. As more models become electrified, more production plants will be retooled, more workers will need to be retrained and more new hires will have to be brought in.

Ebenhoch (pictured below, left) says his division within ZF will re-skill 30,000 workers in the coming months through a program called E-Cademy, for example. Then there’s the fact that EVs have lower part
counts than powertrains in traditional ICE vehicles.

“There will be less complexity and fewer parts,” Abkenar says, adding that for the next decade or so, many automakers will be building both EVs and ICEs.

“We are going to have the time to do the transition we need. The consolidation means that the suppliers who decide to stay in the game have to start figuring out a way to offer solutions to OEMs that allow the OEMs to spend less time on systems engineering, and to be able to focus on the features and delivering what the customers want.”

Exactly what those features are remains somewhat of an exciting mystery. With more connected technologies being installed and more voice assistants and AI and VR all on the way, Ebenhoch says there are massive upsides along with the challenges.

“For an engineer, [the transition is] the best thing that can happen,” he says. “Of course, it’s not that the sun is always shining, as we all know, since we are facing issues like the pandemic and shortages. But looking at it from an engineer’s perspective… there are huge opportunities.”

Steve Bell panel. Abkenar. Ebenhoch