Magna deal could be a hint at what lies ahead
Colin Barnden speaks with a sense of frustration as he talks about Magna International’s acquisition of Veoneer, an auto-tech startup. Semicast Research’s principal analyst Barnden believes Veoneer should be seized long before now.
Magna. Anybody. He believes it is a company that represents the future of automotive. He believes it is a shining diamond in plain sight.
He said, “This is Magna’s absolute genius.” He said, “This is an absolute masterstroke for Magna.” “Why did they buy Veoneer?” It should be “Why didn’t Bosch purchase Veoneer?” “Where was everyone else?”
The pending acquisition of $3.8 billion, all figures in USD, is a major shift in the market for driver-assist technology. According to Semicast Research, Bosch holds 20% of the market. Magna and Veoneer combined will control 17% of the market. Continental follows close behind with 16%.
There’s more to it than just a reshuffle of the business leadership board. Wall Street and major companies in the auto industry are still intrigued by self-driving technology. However, this agreement signals that humans, at least for personally owned cars, will continue to be behind the wheel of the vehicle.
Barnden stated, “I am not going to claim autonomy will never occur.” Barnden said, “Never will be a long period.” It looks like it could take two to three decades to talk about this in such a large way and with a lot of volume.
This may be a shock to those who believe that self-driving abilities are only a matter of time. This forecast isn’t a departure from Magna’s.
Magna’s executive vice-president of technology investment and technology Boris Shulkin stated to Automotive News that the company anticipates short-term volumes and growth in driver aid systems. This is driven by European New Car Assessment Program benchmarks and motorists’ desire for convenience features.
He stated that the area where the bulk market is expected to exist for the next 2-3 generations, and the most growth potential, was this one. Veoneer is a key player in this market. Our company is a major player. Combine the two and you have a truly major player.
That could one day lead to an entry into the self-driving car business. Shulkin highlights Magna’s involvement with Waymo and her investments there as proof of that company’s faith in the future. The Veoneer agreement is rooted in driver-assistance.
Veoneer, a global supplier of Autoliv, was founded in 2018. It quickly built a reputation as a leader in radar systems and perception features.
Veoneer’s own software unit was called Arriver and it relied on Qualcomm’s Snapdragon Rider chips to power its systems. These products together have made Veoneer an innovator in collaborative driving. This is a field in which driving-assist features can be more than just a collection of parts. They are optimized to ensure that motorist and machine trust one another.
Angelos Lakrintis from Strategy Analytics, an industry analyst, said, “They have great expertise and a strong platform. Magna will very happy to acquire Veoneer at the moment.”
Magna’s combined product and expertise will be a crucial part of its future. Shulkin claims there is little overlap in the customer base and expertise of the companies, so the deal will help Magna grow its business in China.
Magna could be interested in new clients such as Stellantis or Mazda, Lakrintis claims. He says that most OEMs prefer to develop their own software and have their own intellectual property collections. Perhaps, then, more customers may come from newer entrants such as Fisker, the company for which Magna will put its contract-manufacturing expertise to use and build the Ocean SUV at its Magna Steyr factory in Graz, Austria.
Are these signs a sign that bigger and better things are ahead? The Korea Times said that Apple was close to signing an agreement with Magna to develop electric cars.
Although no deal was announced four months later, Magna could be “well suited” for the task, said Mark Fitzgerald (also an analyst in industry at Strategy Analytics). No one knows the inside story of Apple. They’re all interested in Project Titan, but then don’t know how to use it. Margin is low. Units are very low. The suppliers can be difficult to work with. Why bother?
Barnden believes Magna’s deal is a big win.
Magna and LG formed a joint venture, LG Magna e-Powertrain, to focus on electrification. They announced their leadership team last week. Magna is a leader in complete vehicle assembly. It has also developed its driver-assistance technology capabilities.
Although tectonic plates are now in place, Barnden stated that few people have seen the bigger picture from Magna’s small steps.
He stated that there is no entry barrier and that if Fisker could do it with Magna then Apple could do the same with Magna.”
It’s about them creating something truly unique in the cabin experience and with driver monitoring. Maybe related to eye-gaze controls. It will be a sight that people can see and say, “Wow!” These pieces are coming together. In the coming years, the whole interface between the car and humans will shift. This is all happening but no one’s paying attention.”
Publited at Mon, 2 Aug 2021 11:51:36 +0000