The product development life cycle is going through a sea of change. Gone are the days when OEMs would be able to launch just a couple of products in a year and still attain growth. India is now the world’s fourth-largest automotive market and the customers today want the best of all worlds but at competitive prices.
Speaking to Express Mobility, Vishwanath Rao, MD, Altair India agrees that time to market for products is shrinking. “Today most OEM’s are talking about 18-to-24-month development cycle from the time they conceive the product to the time they launch the product in the market. In the past that used to be 8-10 years, you know, as probably about 15-16 years back it came down to about 6-7 years, 5 years, 3 years, and today we’re talking about 18 months.”
One of the key enablers for such product development is a simulation, an area where Altair dwells in. The company was founded in 1985 and basically focusses on three primary areas – physics-based simulation, artificial intelligence (AI), and high-performance computing. The vision is to help customers leverage the convergence of all three technologies in making accelerated enterprise-level decisions.
Rao says that the company is involved in many projects with some of the largest OEMs around the world that come to Altair to solve some of their biggest engineering challenges today.
“We are helping the automotive industry shrink their product development time cycle, reduce time to market and at the same time help accomplish a reduction in the cost by virtue of reducing consumption of material, making their designs much lighter, and improve the quality of the products by making them safer. The overall experience of the cabin for a car right from an occupant sitting inside the car to the driving experience that he/she gets in terms of the overall comfort and quality feeling; we enhance that by using our simulation tools,” he says.
He states that simulation is the biggest driver in terms of reducing the lead time.
Simulation to cut weight and reduce development time
It is no secret that OEMs are trying to reduce weight and development time. The reduction in weight enables the vehicle to give higher efficiency especially enabling the vehicle user to squeeze more mileage out of their vehicle.
Rao says the simulation technologies have evolved to an extent where the accuracy of the results is within plus or minus 5-10 per cent as compared to a test scenario. Most of Altair’s simulation results are said to be within plus or minus 5 per cent, which enables customers to make the right decisions just by looking at the data.
One of the key adopters or beneficiaries of simulation in India have been new-age start-ups especially in the electric two- and three-wheeler space.
“Some of them (electric two-wheeler start-ups) have been extremely particular about how they engineer their products. They go deep and use simulation extensively to resolve all the problems before they have launched the products. There are some EV manufacturers in India, especially startups, who are importing designs from other countries and just trying to launch it in India, which is obviously resulting in some sort of issues because those products are not localised for Indian conditions. The local road conditions in India is very different to what it is in some other country. The climatic conditions are very harsh especially during summers, because of the kind of heat that we experience here. Whereas some of these products that are being imported from other countries and launched here are mostly engineered for their local conditions,” expresses Rao.
He believes that a lot of localisation has to happen here, and “simulation is the biggest weapon that is available with all these companies today. Most of these startups want to launch product in 6-9 months only, nothing more than that.”
In a what can be seen as David versus Goliath scenario, start-ups are banking on advanced simulations to skip the whole traditional development cycle that legacy players used to follow. Rao sees that simulation tools have helped start-ups to launch their products with “minimal capital investment, which was not possible earlier.”
Domain knowledge coupled with simulation tools go hand-in-hand
According to the Altair India head, the understanding of the automobile domain is something that cannot be side-lined. The importance of understanding the automotive domain is key to developing the right product because the OEMs really needs to know how their products are going to be used, what kind of market are they trying to serve? Where will the product sell? Is it B2B or B2C?
Simulation alone cannot be a magic wand. The domain knowledge is equally important.
“Somebody who just knows a simulation software tool cannot sit and engineer a two-wheeler or a car; deep understanding of the automobile domain is very important. What simulation helps you do is of course it helps you explore various scenarios which would not have been possible in the past. Even if somebody does not have really, really deep understanding of the automotive domain, he can model some of those problems and replicate some of those field issues in simulation and ensure that they are going to market with the product which is of high quality,” adds Rao.
When queried about the company’s India operations and performance, he said, “We are 25 years old in India. We have roughly about 650 employees in India, out of which about 450 or software developers who are primarily working on developing all these technologies. The simulation tools, AI tools, high-performance computing tools, a lot of those development happens out of our office in India, and the rest of the 200 people are the ones who are in business areas like sales, application, engineering, customer support, back end, IP support, finance, HR, legal and many other operational areas. In terms of our customer mix, I would say there is no company in India today who’s an automobile manufacturer in some or other way who does not use Altair technology. Anybody who works in the automobile industry today, is a customer for Altair; whether it is an OEM or whether It is a large Tier 1 manufacturer or local component manufacturer or a tyre maker. Pretty much every company today in the country uses our tools to build automotive and related products.”
“I have lost count, we probably have 30 or 35 EV startups today or even more probably 50 plus EV startups today who have used Altair technology or using Altair technology to build some of their products,” concludes an optimistic Rao.
INTERVIEW: Vishwanath Rao, MD, Altair India
Will Altair continue to look at new acquisitions and will you be open to JVs in India
We have been constantly acquiring companies. In fact, recently, we acquired a company called Concept Engineering, which is primarily in the area of semiconductor design and validation. And before that, we acquired another company called Powersim, which works in the area of simulating power electronic systems.
We are constantly on the acquisition spree and most of these are technology acquisitions that get integrated into our larger technology offering. These are pieces of technology that are very critical today in terms of what the industry wants, so we acquire these technologies and integrate them into Altair’s unique framework, which is the larger framework for simulation and product development. In terms of JVs. No, we do not have any plans of launching any JVs in India as such, at this point in time. It’s more of technology acquisition and integration of technology into our larger framework that we are looking at.
What are the challenges that you foresee for the Indian automotive sector?
The automotive sector over the last decade has evolved extremely rapidly in terms of being competitive. Today if you see the number of launches. You launch a product today if you don’t sell this in the market very well. If you don’t recover your ROI (Return on Investment) within the next, say 18 months, there’s a new product out there to displace you, it has become like a mobile phone market.
When a product is launched in the market the window of opportunity is just 12-18 months. If you do not cash in in the 12 to 18 months, somebody else is waiting to displace you. This means you will have to be extremely fast and extremely agile, in terms of how you launch products. You cannot have 3-4-year cycle times for product development. They have to shrink considerably.
The product has to be futuristic and very aspirational in nature. Otherwise, the consumer does not want to buy today. He does not want to change a car because his car has become old. He wants to change a car because he wants to go for an aspirational product and people are selling cars in 3-5 years moving to a new car because it is more aspirational.
It (vehicle) is not looked at as an object of utility. It is more of an object of desire right now, the car is for a lot of people; and with the pandemic, everybody is moving towards personal mobility, so that has also accelerated the need for a passenger car or scooter or whatever it is.
What about such fierce competition in the automotive industry?
For the automotive industry, the biggest challenge right now is how do you cope with competition?
There’s tremendous amount of competition from all corners, whether it is startups or global players, local players there is tremendous amount of competition. To be competitive in the marketplace, OEMs need to focus on certain key parameters.
One is how quickly you are able to launch products. Second, what is the quality of your product. Third, is it the object of desire? somebody wants to buy a car because it is just so nice to have.
The whole thing about quality, the whole thing about being an object of desire is kind of becoming the driving force today, and simulation has many technologies which can help OEMs accomplish some of these goals.