Volvo Cars, CEVT and “Platform Thinking” in Automotive Product Development

Erik Gräns knows something about PLM. 

He is responsible for the PLM platform in Chinese automotive company Geely Group’s subsidiary, CEVT, based in Gothenburg, Sweden. CEVT was founded in 2013 to supply the automotive companies within the Geely­ Group–among them Volvo Cars–with product development solutions; platforms that could help them develop new car models more effectively.

But what is a platform? What distinguishes a platform approach from the old way to develop vehicles? How does it connect to PLM and what does the Industry 4.0 concept have to do with it?

I met with Erik and his coworkers to discuss these issues, including software integration, BOM management, and how in just nine short weeks they got a PLM system up and running in a complex operation such as modern vehicle development.

A platform can consist of everything from a parametric packaged design template with the intent to rationally produce variations on a basic theme, for things such as software configurations–for example – to supporting parts of, or the entire product development process. Just as there can be a set of purely physical parts, components that can be combined according to certain patterns.

By creating patterns within specified limits of “ready,” consistent variable geometries, you can­–for example, in the automotive industry–achieve “super-rational” product development and production processes.

In this sense, platforms are springboards for a more competitive and profitable product realization.

An Excellent Example of Conceptual Thinking

Volvo Cars (VCC) is an excellent example of a company that has realized the platform system model, though it is not the first; GM introduced the platform strategy as early as in 1908.

The foundation for a new project is the PLM platform, including CAD design done in Dassault Systèmes’ CATIA (V5 and partly V6), product data and configurations managed in Volvo's proprietary KDP solution, and the allocation of digital components for further processing, design and modification (e.g. simulation and calculation) managed in the PDM system, Siemens Teamcenter.

This solution platform is based on the experience from C3PNG, a legacy from the Ford decade that has gradually been enhanced with the tools needed for simulation-driven product development and systems-based design.

However, IT support for product development is only one aspect of the platform. There are several other important aspects to the VCC-world, a key one is the actual development of vehicles and engines:

• The architecture of the "big" cars, SPA (Scalable Platform Architecture), is one implementation of a platform supporting models like the XC90, XC60 and the new S90 and V90 series.
• The engine development is also based on the platform thinking. The realization is referred to as VEA (Volvo Engine Architecture).

 However, the use of platforms is not limited to deployment in a single company. Sharing the platform with several players enables further steps toward productivity.

This is exactly what is being done within the Chinese Geely Holding Group, the enterprise that owns Volvo Cars, while also developing, producing and selling its own vehicle brands.

A Slightly Different Solution

Mats Fägerhag is an experienced automotive production expert who knows a lot about this.

In 2012, he was recruited by Volvo Cars after 20 years in leading positions at Saab Automobile and GM. His mission was to find a product development partner for Volvo Cars. After thorough market analysis, he suggested a slightly different solution that everyone agreed on: “Let's create a new business that not only helps VCC, but also Geely, to develop the required platforms."

With this, CEVT (China European Vehicle Technology) and the so-called CMA platform (Compact Modular Architecture) were born.

CMA is a platform designed for smaller vehicles, allowing bolder design and the integration of new technology. This applies to the next premium cars in the Volvo 40 series, for example, but is also ideal for the development of other cars produced within the collaboration of Volvo Cars and Geely.

“The CMA concept is basically the modularized architecture for these cars,” said Fägerhag, today the CEO of CEVT. “We design, crash test and test run. Based on the platform, Volvo Cars creates the ‘top hat’ - the visual design and the interior - of their cars. We, in the case of Geely, also won the contract for the complete design of the Geely cars. In all, we have orders for more than 10 complete Geely models.”

CEVT Expanded from 100 to 2,000 Employees in Three Years

Founded in 2013, CEVT quickly became a success. This success came partly by virtue of the way the company built its PLM platform (based on Siemens Teamcenter), which was implemented and commissioned in a record short period of nine weeks, and partly thanks to the high-class products they created, both from design and manufacturability perspectives.

The latter is an essential part of the Industry 4.0 concept, where increased and efficient operation of manufacturing plants is an integral part of the product realization package.

In two years, CEVT has gone from about a hundred employees, to the current approximately 1,900 employees. The plan for 2016 is an increase to approximately 2,000 employees.

In addition to the main office in Gothenburg’s classic industrial blocks at Lindholmen, and a smaller office in Trollhättan, CEVT also has a development office in China with about 500 employees. At present, the company’s budget is over $350 million annually.

An Unshakeable Faith for the Future

Given CEVT’s business momentum, it’s no coincidence that the company representatives from CEVT that I met with in Gothenburg, Sweden, exude an unshakeable faith in their future.

The director of PLM development Erik Gräns, business solution architect Martin Töppner and senior communication manager Stefan Lundin unanimously claimed that CEVT’s development is heading in the right, proactive direction.

However, not that many years ago the situation was far more bleak.

The reason lies in the dramatic economic downturn that began with the 2008 collapse of American investment bank Lehman Brothers. The aftermath saw the global economy shaken down to its foundations, and major automotive companies such as Ford and GM were forced to sell assets to survive.

Volvo Cars was one of the companies to be sold. In the wake of the financial downturn, there were really only two areas in the global community that had both the liquidity and the financial resources required to buy: China and India.

When Geely bought Volvo Cars, there were Cassandras who warned that “Chinese companies were here just to drain this Swedish crown jewel of its excellent intellectual properties and deeper knowledge.”

But Volvo’s engineers wanted something else, and with the development of the Driv-e concept, among other things, they showed that they were a force worth building on.

“Always Remember Where the Source Is”

The dismantling of Volvo Cars in Sweden did not materialize. On the contrary, as CEVT communications manager Stefan Lundin stated, the Geely Group’s chairman Li Shufu gave the Swedish operation increased confidence in more than one way:

“Not only in the form of appreciation for our technology, but he also gave Volvo Car access to one of the world's largest car markets, the Chinese,” he said.

“Business is going well right now.  A large part of Volvo Cars sales is in China,” Lundin continued, adding that, “Our operation here in Gothenburg has become a research and development center for the whole Geely Group, where we deliver technology to both VCC, for its coming small-size premium models, and to Geely Auto, which is more about volume models.”

Why did Geely invest so heavily in this specific R&D facility in Gothenburg?

“There are of course many reasons, but the most important reason is that the Swedish West Coast region is known as a major automotive cluster with a number of recognized skilled automotive and transportation players such as Volvo Cars, Volvo Trucks and previously Saab Automobile. Additionally, most of the global suppliers in the automotive industry are represented here, including Autoliv and SKF. This makes for an engineering tradition that is very attractive,” said Lundin, who also quoted Geely chairman Li Shufu’s way of putting it:

“When we fetch water, we should always remember where the source is.”

The Advantage of Not Carrying a Legacy Burden

When speaking about platforms and architecture, Erik Gräns said, “We usually talk about architecture as a mix of parts and components that can be combined in configurations and contexts that make it possible to create variated strong customer experiences. On top of this, one can then define different interfaces and thus create varied ‘top hats’: exterior and interior designs. To support this, PLM tools play crucial roles,” stated Gräns.

He continued, “It makes it possible to share design drawings, software set-up and other things all over the world, as we do; both in terms of our employees in China and subcontractors in other places throughout the world. But it also includes things like product visualization, configuration management and change management that are areas where our PLM platform is the foundation for global cooperation.”

The overarching tools of CEVT include CATIA (CAD), and Teamcenter (TC PLM / PDM / “collaboration”).  However, related to the focus on simulation-driven product development, it is important to mention that CEVT also uses a handful of CAE tools, such as ANSA, LS Dyna, MSC Adams and Nastran.

When it comes to electronics, Elektra is the backbone while things related to software development (and software simulation) are developed in MATLAB and Simulink. In the PCB (printed circuit boards) area, Mentor Graphics is the design tool.

“So, what do you regard as your primary advantage compared to the competition,” I asked CEVT’s PLM manager Erik Gräns.

The answer came in milliseconds:

“A big advantage is that we are not burdened by an extensive legacy issue. At our inception in 2013, we used Volvo Cars’ database, but quickly realized that we needed a standalone solution, so we took the decision to invest in an out-of-the-box installation based on Siemens Teamcenter.”

CEVT doesn’t work with adaptions, he claimed, since the out-of-the-box-installation generally eliminates the need of costly customizations.  “We create configurations and minor ‘settings,’ and if some more development is needed we simply put it into a workflow,” Gräns added.

“That’s right,” confirmed Siemens PLM’s Sverker Nordlander, a business analyst and senior project manager. He explained that, “As CEVT has no legacy systems, they are standing free from historical considerations and complications. Thus, they can make full use of the out-of-the-box Teamcenter platform, which will not only be cheaper but also technically more rational. They can always use the latest technology and the latest software solutions.”

A Complex PLM System was Up and Running in Just Nine Weeks

Only nine weeks after the decision to implement, the system was up and running. This is an impressively quick installation given the complexity of the task.

“Getting a complex PLM system up and running in a matter of nine weeks – how is that possible?” I asked Nordlander.

He replied, “Teamcenter is built as a modular system with built-in best practices based on industry specific templates. This allows you to implement the parts you need, when you need them, in an incremental way. One example is that the serviceBOM at CEVT was added two years after they began with Teamcenter. The templates also provide a fully tested functional setup in an efficient way, meaning you get the business value directly.”

“Even if you have very specific needs, an out-of-the-box template providing maybe 95 percent of your needs directly, and which can be enhanced at a later date easily and without any major changes, is far better than a 100 percent solution that takes years to define and implement. Avoiding customizations also ensures you can add and upgrade with new functionality,” Norlander added.

For CEVT, the new PLM platform changed a lot.

“This means that today we do not use the KDP–Volvo Cars’ configurator–but have developed our own system based on Teamcenter, which we use to deal with things like the product, parts structures and BOM’s (Bill of Materials). But BOP’s (Bill of Process) are also created and managed in Teamcenter, where we also perform VM simulations,” Erik Gräns explained. VM, or virtual manufacturing, covers disciplines such as digital production planning, simulation and control.

Advantages Brought on by Siemens Teamcenter

So, what did using Teamcenter technology in CEVT’s out-of-the-box (OOTB) installation make possible? And why wouldn’t this have worked as easily in an old installation with legacy data? Here are a couple of examples:

Integration between solutions was previously challenging; for example, the integration of CAD and CAE. Due to legacy data from Volvo Cars’, CEVT uses CATIA as the CAD system; but it also inherits some PTC Creo data from Geely, and gets other formats from suppliers. With the old way of customized solutions, it would be very expensive to maintain and upgrade as the CAD tools or the database changes.

Sverker Nordlander said, “By using OOTB CAD integrations from Teamcenter, this is no longer a problem. We maintain them. Since we also build on standards such as JT, all CAD systems are treated equally and can be visualized in Teamcenter independently of their origin.”

Another example is integration with downstream applications such as manufacturing. OOTB solutions use TeamCenter, where manufacturing data is also created and authored.  “Especially for manufacturing, existing companies that are older than CEVT have a lot of legacy applications that need custom integrations,” said Nordlander.

He continued, “In TeamCenter this is not needed, and we also have integration with MES (Manufacturing Execution Systems) and use the industry standard ISA-95 specification. There are many other examples, but one important point is that if you work in OOTB, it is much easier to move to new technology (when you want to; you are not forced to), such as our new 4G concept that will revolutionize the market. 4G is based on components that are managed and configured independently and use usage-based technology to ‘create’ the final configured product.”

Software Integration: A Problem Which Isn’t a Problem

Integrated software is often considered problematic. An oft-heard criticism is that, “the large PLM systems cannot handle these pieces well enough.”

German PLM professor Martin Eigner from Kaiserslautern University is one such critic. When I discussed this topic with him, he stressed how crucial the interdisciplinary integration is.

Specifically, Eigner mentioned the problem of connecting software to the BOM. “Yes, this is a typical problem. Software has no Bill of Materials, and we have to learn that software generally is built on linear file structures, maybe with branches that merge and usually have a manually driven baseline process. The manually driven baseline is what we are able to handle with a version, with a revision. At the end, the software should be a part of the Bill of Materials.”

Is that hard to carry through?

“Well, on a principal level, no. However, we have to understand that change management of software is totally different from change management of hardware. Ninety percent of my customers have no Bill of Materials with integrated software,” Eigner added.

CEVT’s Erik Gräns has no problem with this. They are working according to an integrated configuration model, and the software is a part of it. “We treat software like any other part. It is managed according to the same principles as everything from specs and definition of change management etc., and included in the mBOM. Everything is managed in Siemens Teamcenter.”

Finally, Martin Töppner, CEVT’s business solution architect, pointed out that PLM is not just a matter of product development and production. Today, it also includes things like the aftermarket.

“We are well positioned here as well,” said Töppner. He continued, “We are now developing solutions in Teamcenter for sBOM’s (serviceBOM) and the Bill of Service (’how a vehicle is to be repaired’), which are all to become built-in to the CMA architecture.”

Systems-Driven Product Development, Platforms and Industry 4.0

The CEVT story is interesting when seen through these different perspectives.

Product development and manufacturing of cars has become extremely complex, specifically in light of the number of systems involved in the realization process. What used to be a matter of assemblies of parts and mechanical and electronical components, today involves far, far more complexity stemming from areas like sensor and software systems. The industry has been forced to develop new tools to manage this complexity.

Platforms such as the ones developed by Volvo Cars and CEVT make life easier in this respect, and point to platforms becoming an increasingly common part of the development and realization process.

The Industry 4.0 concept plays a key role, as it represents the intention to connect product development and production processes into a seamless whole. Ultimately, the idea is that all parts, components, electronics and software will be able to “tell” what function they have, how they are designed, which coupling opportunities they are provided with and what resources are required for production. Enabling technologies are necessary to take advantage of this arsenal of tools, of which platform concepts are of growing importance.

That said, it is clear that a systems-driven product development approach is, if not inevitable, very close to it. Siemens PLM  is the major PLM player which most strongly advocates this method of attacking the complexity issue.

All the different systems in a vehicle need to be developed in a way that allows the systems not only to coexist, but to work together as well. This requires an approach that combines systems with integrated product definitions and reconciliation of the parameters included in a framework.

But it doesn’t end there. This framework should cover not only product development, but also the manufacturing processes involved, such as Industry 4.0. In the latter case, it needs to include things like digital control of events on the shop floor.

These ideas are all parts of Siemens’ vision, and their intentions are manifested in the Teamcenter suite. This is a good start on the journey towards obtaining optimal competitiveness. There´s still some distance to go, but CEVT has started down the path. It is this type of collaboration between software developers and users that will lead the way forward.