UK engineering firm Ricardo aims to tap that growing need and double its business with Japanese automakers in three to five years. The company sees so much potential that it is even considering building a tech center here.
It reflects a shift in thinking at Japanese automakers, which typically like to keep engineering in-house. That is partly to keep control over the core technologies and partly to keep tabs on costs to increase their bargaining leverage with suppliers.
Several converging trends are driving the change. The first is the ever-increasing load of engineering work required by more stringent emissions regulations and safety guidelines. Add to that new demand for autonomous-driving technologies. Meanwhile, a tight labor market for engineers in Japan, especially for software engineers, pressures automakers to seek outside help.
“It’s changed significantly over the years,” said Akio Okamura, CEO of Ricardo Japan, the company’s local unit.
Ricardo wants to double its sales to Japanese automakers to £40 million over the next five years partly by helping them design the hybrid and electric powertrain systems needed to meet stricter fuel economy standards.
“The companies don’t have a choice,” Okamura said of seeking outside help. “It requires a lot of engineering resources to do it for gasoline, for diesel and for electrification.”
Engine design accounts for about 75% of Ricardo’s work for Japanese auto manufacturers today, while hybrid and electric systems chip in less than 5%, Okamura reckons.
Ricardo sees big growth potential in developing mild hybrid systems for Japanese automakers. These systems use a 48-volt lithium ion battery as a cost-effective way to improve fuel efficiency by relieving the load on the engine.
The battery can power energy-hungry systems such as climate control and onboard entertainment. It also can drive an electric motor that assists the engine when accelerating.
Some automakers turn to engineering firms such as Ricardo, or rivals AVL List GmbH of Austria and Germany’s FEV GmbH, to take on mundane, everyday engineering tasks to free the automaker to channel its limited resources into advanced R&D.
Others tap the outside expertise in areas where they are weak or for access to new technologies.
