Car Companies, Standard Thyself Or Die

Bertel Schmitt
by Bertel Schmitt
car companies standard thyself or die

The two-by-four, the 4×8 plywood sheet, the standard brick: Without standardized building materials, building houses would be a mess. The car industry is in that kind of a mess (more or less.) To get out of the mess, to shorten development times and to lower cost, just about every large automaker is on some kind of a standardization drive. Usually, these standards won’t go beyond the company, even alliances have problems agreeing on a common standard. When Nissan unveiled its Common Module Family (CMF) last Monday at its R&D center in Atsugi, we asked whether this Common Module Family also would extend to Renault. After all, both companies had standardized on the same CEO.

We received an evasive answer.

The idea behind standardization is this: Just like houses are built from standard building materials and yet maintain their individual style (unless we have lazy architects,) cars could be designed from standard building blocks. Common platforms were one step in that direction, but it was just a first step on a very long road.

When GM announced its standardization drive last year, it was looking at 30 “core architectures” and a huge number of regional solutions. By 2014, GM wanted to shrink the number of “core architectures” to 24. By 2018, GM wanted to have eliminated all regional architectures and be ready to serve 90 percent of the volume with 14 global architectures. GM is at the very beginning of standardization.

On the other side of the spectrum appears to be Volkswagen with its MQB, MLB etc. kits. Volkswagen is about to take the next step, abandon platforms altogether and instead will design its cars from building blocks with clearly defined measurements and interfaces.

Nissan is somewhere in the middle. Nissan’s CMF uses four modules – engine compartment, cockpit, front underbody and rear underbody and a common architecture for electronic components. They call that 4+1. Then, they change the modules. They will need at least two engines compartments, three front underbodies, three cockpits, and three rear underbodies. Full standardization will take a while.

I pulled a Nissan engineer to the side and asked him how CMF compares to Volkswagen’s MQB. After the requisite quantity of air was sucked through the teeth, my engineer said that Volkswagen is in an enviable position. VW already had been building its cars from a handful of platforms, whereas Nissan “more or less did build a new platform for each car.” So for Nissan, it’s a big step to go to 4+1, which actually is 2x3x3x3+1=55

Indeed, Volkswagen makes its cars from 5 platforms, A0 through D, with most of the volume in A and B. When it comes to standardization, Volkswagen is way ahead of the crowd and can now take the next step towards the holy grail of standard building blocks, “Lego Blocks” as the dream is called in the business.

One indicator of the much higher granularity of the Volkswagen kits: Volkswagen specifically said that the kits allow them to design and built low volume cars quickly and reasonably. Nissan on the other hand stops using the CMF architecture if a car is built less than 5,000 times a year.

Designing cars from common building blocks and making them with standardized parts should lower the cost. Both Volkswagen and Nissan interestingly talk about a 30 percent cost reduction. Don’t think prices will drop because of this. Nissan says that government demands on safety and fuel efficiency raise the cost by 30 percent. The savings from standardization pay for compliance with government rules.

All larger car companies are busy with one standardization project or the other. By the end of last week, Toyota announced that it wants to develop common parts for about half of its 4,000-5,000 components within the next four years. A carmaker that is not thinking about standardization should be thinking about retirement.

The Godzilla of all standardization drives does not seem to happen: Still under the shock of the March 11 earthquake and tsunami, the Japanese government had demanded that automakers standardize most of the parts used by all Japanese makers. As things went back to normal, this demand was quickly ignored and forgotten.

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  • Luke42 Luke42 on Mar 04, 2012

    So, what will this do for Volkswagen's reliability and repairability? Volkswagen's doing fine in most respects, and I like the looks of their designs -- but I got burned so badly on my 2001 Jetta that I cannot afford to own a Volkswagen vehicle after the warranty expires, and I'm not likely to buy again anyway. Put a 150k-mile warranty on a Jetta Sportwagen TDI or an A4 TDI, though, and we'll talk. Either that, or make it super-easy and super-cheap to replace parts, like the Grumman LLV. I'll take either extreme.

  • Swervin Swervin on Mar 05, 2012

    Didn't Steven Lang state that prices have dropped about 30% over a time spanning the 90's to the mid 2000's. Also the Eagle Vision post mentioned how that car was $40,000 plus in todays dollars. I do not think cars are getting more expensive.

  • Jeff S I don't believe gm will die but that it will continue to shrink in product and market share and it will probably be acquired by a foreign manufacturer. I doubt gm lacks funds as it did in 2008 and that they have more than enough cash at hand but gm will not expand as it did in the past and the emphasis is more on profitability and cutting costs to the bone. Making gm a more attractive takeover target and cut costs at the expense of more desirable and reliable products. At the time of Farago's article I was in favor of the Government bailout more to save jobs and suppliers but today I would not be in favor of the bailout. My opinions on gm have changed since 2008 and 2009 and now I really don't care if gm survives or not.
  • Kwik_Shift I was a GM fan boy until it ended in 2013 when I traded in my Avalanche to go over to Nissan.
  • Stuart de Baker I didn't bother to read this article. I'll wait until a definitive headline comes out, and I'll be surprised if Tesla actually produces the Cybertruck. It certainly looks impractical for both snowy and hot sunny weather.
  • Stuart de Baker This is very interesting information. I was in no danger of buying a Tesla. I love my '08 Civic (stick), and it feels just as responsive as when I bought it 11 years ago with 35k on the clock (now 151k), and barring mishaps, I plan to keep it for the next 25 years or so, which would put me into my mid-90s, assuming I live that long. On your information, I will avoid renting Teslas.
  • RHD The only people who would buy this would be those convinced by a website that they are great, and order one sight-unseen. They would have to have be completely out of touch with every form of media for the last year. There might actually be a few of these people, but not very many. They would also have to be completely ignorant of the Hyundai Excel. (Vinfast seems to make the original Excel look like a Camry in comparison.)