Visteon | Setting Strategies To Meet Future Challenges In Electronics

Visteon | Setting Strategies To Meet Future Challenges In Electronics

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With the sale of its ownership interest in Halla Visteon Climate Control Corp (HVCC) – the division that produced HVAC systems – to Hahn & Co and Hankook Tire in December 2014, Visteon clearly indicated and announced to the world its focus for the future: cockpit information systems.

Around the same time, the Michigan, US-headquartered company was also looking at hiring a new Chief Executive Officer to bolster the push required for its future business strategies. In the same week the company sold its last non-core asset HVCC, Sachin Lawande, who is considered to be one of the foremost technology and business thought leaders in the automotive OEM electronics supplier industry, joined Visteon as its President & CEO.

In March this year, Lawande was on his maiden visit to India in his new role. During a whirlwind tour that involved customer visits and employee engagement sessions, he spent an hour with a select group of media professionals at the company's technical centre in Pune. This article highlights some of the major subjects he broached during the freewheeling chat with us.

THE NEXT DECADE

Visteon today is a global supplier to most of the world's major vehicle manufacturers for innovative cockpit electronics products and connected car solutions. A multi-business Tier I supplier previously, with interest in interiors, panels, seating, heating, ventilation, air-conditioning and electronics, Visteon realised it wasn't possible to do everything, and yet remain technology leaders. That led the company to shed all its non-core assets over time.

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The technology landscape, particularly in the area of electronics, has been undergoing tremendous change in the last few years, and the next decade could potentially see more change than what the industry has seen in the last 50 years. The pace of innovation is increasing at a tremendous pace, and so is the pace of adoption, said Lawande. This essentially is due to three pressure areas that are completely changing the industry: competitive environment, consumer pull and regulatory interventions.

Lawande has set high aspirations and stringent targets for the company. Under his leadership, Visteon is aiming to emerge as a mega supplier in the six product categories it is present in – instrument clusters, central information displays, infotainment systems, audio, telematics and head-up displays. These products cover almost everything that a modern cockpit has in a vehicle. Incidentally, Visteon is one of only two suppliers with all six products.

CHALLENGES GALORE

One of the key challenges that Visteon foresees for the future is to do with the increasing cost of electronics globally. In normal circumstances, average sales price (ASP) of electronics goes down, like we see in the case of consumer electronics. In the automotive industry though, the ASP has been increasing in five of the six product categories Visteon does business in. Primarily, this is a result of the content share in devices going up, be it in displays, CPUs or memory.

"As the industry evolves, the cost of electronics in building a car is getting to a point, where the OEMs are not being able to pass on the cost to the consumers. On an average, electronics account for 30 % of the total cost of the vehicle today. At this rate, it will cross 50 % of the value in the next 5-10 years," Lawande said.

Beyond cost, the two other serious challenges for any electronics manufacturer today are with regards to hardware and cyber security. As an organisational objective, Visteon has already stated its intent to exclusively focus on electronics and software. Where does that place the company in terms of hardware? "There surely is a need to offer the best embedded hardware," noted Lawande and assured that the company probably has the best vision to tackle these challenges.

He drove home his point by referring to an incident from July 2015, where security researchers Charlie Miller and Chris Valasek demonstrated that a Jeep Cherokee could be hacked remotely. The duo exploited a vulnerability in the hardware chip of the vehicle's UConnect infotainment system, said reports, which allowed them access to Jeep's other systems, and they could wirelessly control all such vehicles fitted with the UConnect system. Such deep was their intrusion that they were able to track the vehicles down to their exact location, switch on or off the lights and blinkers, and control the radio and navigation. What was most horrifying though was the fact that they could also tamper with the brakes and steering of some of those vehicles, greatly risking life of vehicle occupants.

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Lawande knows the exact point of vulnerability in the Jeep system; they entered the vehicle through its infotainment system, a system he had built in his earlier organisation. The problem wasn't with the infotainment system though, but with the telemetry control unit (TCU) or the modem that another supplier built. That TCU had some open ports, which allowed the hackers to get into the infotainment system and through that onto the CAN BUS so they could control the vehicle, he explained.

"Earlier, hacking required proximity to the vehicle. For instance, one could enter a vehicle system through the tyre pressure monitoring system (TPMS) or the on-board diagnostics (OBD) port. For the first time, Miller and Valasek were able to stop a running vehicle over-the-air. That was a warning call," Lawande said.

Meanwhile, the industry has taken note, and a standard called SHE (secured hardware extension) has evolved. Visteon, in fact, will be the first company to offer a SHE-compliant device, both for infotainment as well as for clusters. "It starts at a very basic level – secured hardware – and anyone tampering with it will lead the device to self-destruct. It also has a secure boot. All data that is stored is encrypted, and all third party software downloaded into the system would need authentication," said Lawande, who also serves on Visteon's board of directors.

In the Jeep incident, for example, the hackers downloaded themselves as an app because the infotainment system allowed that. The app had no authenticity.

CHANGE IN APPROACH

Cyber security is more of a DNA that an organisation has to adopt. And Visteon is working towards that. Software would need to be completely redesigned, and that will mean changes and upgrades of related technologies. The Society of Automotive Engineers (SAE) has proposed a new framework for cyber security, called J3061, which establishes a set of high-level guiding principles for cyber security. An SAE publication states that among other things, this includes defining a framework for a lifecycle process to incorporate cyber security into automotive cyber-physical systems, and providing information on some common tools and methods used, when designing and validating cyber-physical automotive systems.

On its part, Visteon wants to build its own capabilities in White Hat hacking (ethical hacking), so it can make its products as secure as possible. Lawande informed us that the company is currently exploring locations in Chennai, Bangalore and Pune to set-up its Centre for Cyber Security Testing, thus becoming one of the first companies in the world to have that kind of capability. Visteon is also establishing a position for a Chief Cyber Security Officer.

Choosing India for the lab is not without reason. There are companies in India that offer cyber security testing services, but for websites. Many of those capabilities are similar to what Visteon needs for its automotive products. Lawande said he is not averse to the idea of acquiring such a company, as the idea is to build that capability in-house. "We have to define processes that don't exist today. Anything that is life and mission critical must be addressed now, while secondary and tertiary threats can be handled later," he said.

NEW INNOVATION

One of the most recent innovations that have caught the imagination of manufacturers in both mature markets, and developing markets like India, is Visteon's approach to cockpit module consolidation. SmartCore is a scalable and flexible framework that addresses the increasing complexity of cockpit electronics to improve the driving experience. Lawande explained, "The underlying silicon capabilities are getting to a point, where we can actually integrate some of our six products. So, instead of having a separate electronics box for each of these products, we can integrate them and reduce the cost. That is what SmartCore offers."

SmartCore is a cost-effective, security-focused, one-chip, multi-domain controller featuring a single integrated, seamless human-machine interface (HMI). The solution allows multiple domains to run side-by-side on a scalable hardware with different operating systems, leading to reduction in system complexity. Although an industry-first solution, the opportunity is far bigger for one company to deliver, said Lawande.

Readers would recall our detailed featured
on the SmartCore solution in our December
2015 edition.

"It was in 2005 that we as an industry saw a 3 GHz CPU, and 11 years since, we still have the same 3 GHz clock rate. But the number of cores per chip has increased, meaning more CPUs on a single chip. It is no longer cost effective to make a single core processor. None of our six products need a 3 GHz processor with four cores. This led to consolidation, and the SmartCore was born," explained Lawande.

Visteon had earlier announced it would launch with a German OEM the first integrated cluster in infotainment in 2018. That, however, could change. The solution has caught the imagination of Indian OEMs, and we could see its introduction in the Indian market ahead of the European launch, we have learnt. The general perception with this solution was that the more mature OEMs would adopt this first, but the willingness of Indian OEMs to introduce this in their products has "surprised" the Visteon President & CEO.

ROUND-UP

Globally, cockpit electronics is growing at about 7 %, while automotive sales in general have witnessed about 3 % growth annually. The company wants to be the undisputed leaders in the cockpit area globally, and Lawande is clear he wants to achieve this on the back of technology leadership, with tight focus on customer requirements & needs, a cost mind-set, and operating with speed in a truly global organisation.

The company ended 2015 on a very good note, with about $ 700-800 mn in cash reserves. Lawande is open to taking an inorganic route to growth. It acquired a company in Bangalore last year, and would do more such acquisition to strengthen its technological prowess. India is important to Visteon, and so is the "Make in India" programme. Lawande is looking at making India a manufacturing base not just for domestic, but also Visteon's global requirements. That is possible, he said, but somewhere along the line, Indian suppliers would also need to step up their game in other, related products such plastics.

Text: Deepangshu Dev Sarmah

Photo: Visteon