Competitiveness: questions and hypothesis (1) Different issues with US-Japan and India-China –India and China : knowledge transfer Joint venture (mandatory in China), still useful to enter a local market (India) Buying European or US companies : Volvo, MG Rover,… Existence of major and growing markets –Hypothesis ; software will still be a major European advantage compared to China and even India –Competition with Japan and US : business as usual, but Europe slightly behind in EV EV competition did not start yet For HEV Japan has an ahead start (Toyota Prius 2000, Honda Insight 1999, leveraged into other models), but followed by US and Europe Software delocalization: a way to competitiveness? –Reduce software costs (strong effort already done in hardware cost reduction) –Mostly done by OEM and TIER1 through subsidiaries (rather than subcontracting) APE 28 April 2010

Competitiveness: questions and hypothesis (2) European strengths –Existence of independent and highly skilled software houses –Considerable knowledge and expertise in chassis and engine software (all players) –Lead in standards development: AUTOSAR –An established level of cooperation, both informal and formal, allowing to reduce costs –A possible synergy with other sectors: aerospace, train and generic embedded systems development –Used to take into account regulations: CO, safety –Strengths in power ICs European weaknesses –HEV deployment: Toyota Prius 1.2 million sold around the world –Domains where knowledge from different sectors are needed: Infotainment and telematics –Labor cost: software development needs educated manpower APE 28 April 2010

Competitiveness: questions and hypothesis (3) Opportunities –Develop EV software using the already achieved automotive knowledge Cooperation Daimler BYD –Develop new software associated to new EV architecture Active Wheel: Michelin with Valeo and Citic Guoan Mengguli Corp.(MGL) Li Ion battery manufacturer –Continue progresses to reduce software development costs AUTOSAR extension Common platforms –Infotainment: use of open source software –V2X software and ADAS systems –Intelligent transportation systems Threats –Growing level of software automotive expertise by local industry in India and China –Delocalization: a threat or an opportunity? APE 28 April 2010