Note the term “upcoming,” as perhaps equally significant with its new CTO is a foundational change in Continental’s corporate structure, along with a large shift in engineering expertise. The change in corporate structure is adapting to overall growth, and the company also plans to shift thousands of engineers to help it adapt to the rapidly evolving automotive landscape. Under its new Automotive Group, Continental will pool its R&D resources to instill faster creation of next-gen autonomous and connected mobility tech.
“The intention is to move responsibility for the business down in the organization. We are too centralized for the complexity and size of the company,” said CEO Degenhart. “We will realign our R&D capacities on the automotive side. The target is to do this by the end of 2019. The focus will be on autonomous driving on one side, vehicle networking on the other.”
New structure and potential powertrain IPOAbendroth’s appointment to CTO caps a shift Continental has been discussing since late 2018, in what it describes as “one of the largest organizational changes in the technology company’s history.” The global supplier is realigning its business units under a new Continental Group umbrella, overseeing three sectors: Continental Rubber (tires); Continental Automotive (which encompasses the new R&D group) and Powertrain.
As of January 1, Continental had already completed the spinoff of its Powertrain division into an independent entity (with a new name forthcoming) and it’s preparing for an IPO. “Our realignment is a response to the profound changes in the automotive industry and the associated challenges,” said Degenhart. “After this initial key milestone in our realignment, we are now working at full steam to prepare for the partial IPO of our successful powertrain business, which could be possible from mid-2019.”
“If you're looking at what will happen in the powertrain arena in the next fifteen years, then the train is out of the station in regards to transformation from combustion technology to electrification technology,” Degenhart explained. “And the train is picking up speed. This is one of the major reasons why we decided that powertrain has to stand on its own feet, has to be run by its own management team who has the freedom to make decisions, and be fast and flexible.”
Automotive group combining functionsThe new Automotive R&D group led by Abendroth will draw expertise and mission from both the Interior (which includes communication tech) and Chassis divisions. “What we are intending to do within the two divisions, interior and chassis, today are about 27,000 engineers. The target is to take about 12 thousand of these engineers and centralize them under the responsibility of Dirk,” Degenhart explained. “This will be an engineering powerhouse. If you are talking about complex developments for autonomous driving, for connectivity, this makes a lot of sense and will be to the benefit of our core customers especially.”
“We see the advantage when we bundle those things which might have grown up right now in different business units,” said Helmut Matschi, executive board member of Continental’s Interior Division, which be the staffing source for much of the new R&D’s division’s talent. “By bundling, we can bring several things together. For example, we've had network access devices in the past of course in the connectivity business unit. But also, we've had network access devices within body security because gateways also became connected. Our folks within commercial vehicles, another business unit, also need the connectivity. It makes much more sense right now bringing that together.”
“The main point is that we need to change the mindset from a purely hardware/product-driven thinking towards functional thinking,” Abendroth said of the systemic R&D shift. “We need to focus on functional development, and this restructuring we're undergoing right now is exactly to enable this in terms of technology, people, thinking. It's much more than just moving people from left to right.”
Software is now centralThe autonomous future will be heavily code-driven, and Continental claims more than half of the investment in new advanced-driving functions is centered on programming. “The future of mobility requires more and more software,” Degenhart said. “We’re in the acquisition phase of projects where 100% of the development effort will be spent for software development. We have to re-use software to a much higher content in the future than in the past.”
“Obviously, there is a connection between the areas of connectivity and vehicle networks, and autonomous driving,” said new CTO Abendroth. “The main idea is to bundle those capacities, bundle efficiencies, to make sure we can in the end serve all the requests we have from all the different customers. We need to build a certain platform, otherwise we simply run out of capacities. It’s managing our internal efficiencies and preparing for requests coming in the future.” Continue reading »