It is not every day that there are messages as dramatic as the one Hyundai KIA Motors and Siemens Digital Industries Software delivered last week. Engineering.com was the first media to reveal that Hyundai Kia, the world's fifth largest car manufacturer, is investing in the Siemens Xcelerator portfolio with NX on the CAD side and the PLM/PDM suite Teamcenter as product data backbone.

This investment also means that the curtain will gradually fall for the existing solutions: Dassault Systems' CATIA, and PTC's Creo within CAD (for powertrain design) and PTC's Windchill PDM. These will be phased out as new model projects are launched on the Xcelerator platform.

This is a great win for Siemens, but it is also a tough challenge since changes of this magnitude are anything but easy. How does HKMC plan to carry this through? What does the timeframe look like? These are relevant questions when we’re talking about a transition for—according to my estimates—at least 3,500 coworkers in terms of CAD, and probably more than 10,000 seats in the Teamcenter cPDm (collaborative Product Definition management) area.

Creating the Next-Generation Design Environment. “From 2024, we expect that the newly introduced features and methodologies will contribute greatly to innovation, especially on the development system based on CAD and PDM. Through close collaboration with the R&D division as well as related sectors, we will actively respond to the changing future environment through process innovation in the entire product life cycle,” says Gwi Young Park, VP of Hyundai-KIA’s Digital Engineering Center. (Image courtesy of HMG TV.)

Siemens was Selected Preferred Partner in August 2021

In an internal TV broadcast, Hyundai KIA Motors' Gwi Young Park, VP of the Digital Engineering Center, revealed more about the backdrop of the deal, and the planned path forward.

The background is that HKMC signed an MOU (Memorandum of Understanding) with Siemens on October 7th. This generally contained details of the participants’ common goal to build a next-generation environment.

Prior to the agreement, HKMC ran a task force involving research institutions and business partners to help select its next-generation design environment solution. The result of this process was the selection of Siemens as the preferred bidder in August 2021.

The bottom line is that through this agreement, HKMC plans to build a single CAD and PDM environment based on Siemens NX CAD and the PLM/PDM suite Teamcenter.

How Does Hyundai KIA Motors Plan to Move Forward?

Primarily, the two companies will first establish a design method that considers the life cycle of all automobile products, which will be based on NX and Teamcenter.

Then they will conduct joint research for precedence process management. HKMC and Siemens also plan to exchange human resources such as training professionals and providing specialized education for the efficient use and operation management of NX and Teamcenter.

They will also cooperate in various operations to secure development efficiency. To this end, HKMC has been operating a company-wide task force since this year. It has also been pursuing innovative tasks by actively reflecting on opinions from users, aiming to minimize risk or inconvenience due to changes in the design environment.

The Third Generation Platform. These days, most vehicle manufacturers have built up basic platforms for their product development of vehicles. This is a key factor that determines design, dynamic steering, safety, cabin space and other basic aspects of the vehicle. It is no surprise that Hyundai-KIA Motors is investing so many resources in developing this platform. The picture above shows the company's third-generation platform. There are many benefits, but basically, a well-designed platform can provide a significant advantage in terms of development costs and time. Well-tested and proven platforms and modules can be useful for several vehicle types by being easy to adjust and configure, enabling more efficient testing and development.

A Move to Improve the Capabilities of Aging Systems

“The R&D division held an MOU signing ceremony today to build a next-generation design environment to preemptively respond to the future mobility environment and architecture development system,” said Gwi Young Park, digital engineering VP at HKMC.

“We plan to maximize the efficiency of development processes by improving the aging CAD and PDM to the latest environment and minimizing inconvenience in the field,” he went on to state.

In the future, HKMC will build an architecture-based state-of-the-art development environment to proactively respond to the rapidly changing future mobility environment. By maximizing R&D efficiency through integrated data management over the entire product life cycle, the intention is to lead digital transformation in the future.

“From 2024, we expect that the newly introduced features and methodologies will contribute greatly to innovation, especially on the development system based on CAD and PDM. Through close collaboration with the R&D division as well as related sectors, we will actively respond to the changing future environment through process innovation in the entire product life cycle,” Gwi Young Park concluded.

Signing The Contract. A signing ceremony with the involved parties was held on October 7th. To the left is Hyundai KIA’s country manager Byung Joon Oh, and to the right, Albert Biermann, head of Hyundai Group’s R&D division. (Image courtesy of HMG TV.)

My Take: A Tough, But Profitable and Necessary Move by HKMC

In many ways, HKMC’s decision is an interesting reflection of what could be a major trend in automotive. The big OEMs are in the middle of a period of dramatic changes in design methodology, especially related to the electrification of the world’s vehicle fleet. Software, online connectivity and electro-mechanics have moved up to the top position as the heaviest domains in product development work.

In parallel, the manufacturing side is also changing—which means that OEMs have begun to look at how to more efficiently link the product development and manufacturing processes. The mainstay of this is not only that simulation and analysis have become increasingly important as the entire value chain is digitized, but also that the links between the previously siloed product development and production apparatuses must be strengthened.

Other trends are related to developing the systematic use of digital twins—not only of the vehicle models, but also of production lines and mechanical equipment on the factory floors, where you can “insert” digital vehicle models that know how and with what parts and in which stations they are to be manufactured. This is all also fully traceable and makes it possible to simulate from multiple perspectives. This is all in order to be able to digitally optimize production.

It is easy to see that this requires new, customized, modernized and seamlessly connected PLM, ERP and OT (Operational Technology) platforms, as well as the next generation of solutions with tightly integrated capabilities. It is equally clear that the changes brought about by these major trends will be tough and require a lot of work.

My view is that under the spotlight of the EV revolution, HMKC made a proactive and tough decision, but also one that over time holds the promise of being profitable. Siemens is a leading player in many aspects of next-generation technology development, as well as in terms of widely integrated platform capabilities. A specific and unique strength is Siemens’ strong connections between PLM and smart automation, where the developer presently is at the forefront.

Siemens representatives during the signing ceremony. From right to left: Mike Hicks, product manager NX; Bob Haubrock, head of NX development; Bob Jones, head of global sales and customer success; Joe Bohman, head of Teamcenter development; and Bas Kuper, head of Asia Pacific. (Image courtesy of HMG TV.)

The Daimler Mercedes Experience

So, how hard is it to carry the next-generation design environment?

It’s challenging, but doable—and few actors in the business are as well-equipped as Siemens.

In this context, recall Siemens’ track record in automotive—in particular, the swap they made together with Daimler Mercedes, when CATIA V5 was swapped out against NX for the company’s CAD. In this case, the decision included around 7,000 CAD seats.

The project was not a walk in the park. There were serious risks attached, but after a four-year implementation period, the project was up and running in March 2015. While it was a success, there were naturally some bumps in the road.

In the late phase of the implementation process, I had an interview with one of the most prominent PLM executives in the Daimler organization at the time, professor Alfred Katzenbach. As director of IT Management in Mercedes-Benz R&D department, he was responsible for the preparation and presentation of the project to the Daimler Board.

Was it a smooth transition process, I asked.

“No,” Katzenbach said. “A project of this magnitude never is; that's an illusion. Nobody can ever convince me that such a project can run without any difficulties.”

It is easy to agree; we’re talking about a comprehensive change process, and the nature of change is that it creates uncertainty among many people.

The technology itself was not necessarily the main problem. Instead, said Katzenbach, it is more a question of psychological factors.

“There are always a variety of personality types involved in such extensive organizational changes. We have, for example, the “visionaries” and the “innovators” who are always easy to convince. The same goes for the “early adopters,” while it takes a little longer to convince the “late-maturing.” And then you've got the “laggards” who are very hard to convince,” he said.

Add to this the new processes that have to be performed in a new software environment, and “it's easy to see the complexity of this transition,” Katzenbach asserted.

Valuable Experiences. In 2015, Daimler replaced its CAD system CATIA V5 with Siemens NX. From the time the decision was made, the implementation process took about four years before the system was fully rolled out among the approximately 7,000 users. The change at HKMC comprises about half of this number; but on the other hand, the cPDm /PDM solution Teamcenter will also be implemented as product data backbone.

A Change Worth the Effort

All that being said, the gains made were clear and positive.

“In the end, the change has proven to be worth the effort,” concluded Katzenbach. Daimler Mercedes and Siemens found ways to deal with the problems that arose along the way. “The experience we had with our colleagues from Siemens PLM is that success demands quick responses to fix a problem as soon as it occurs.” Pitfalls were expected, and the PLM department at Daimler reacted to address those challenges.

At Hyundai KIA, the challenge is that not only the CAD system is to be changed, but also the cPDm/PDM backbone is up for renewal. One advantage to this is that these are both Siemens solutions with an initial compatibility, which is optimal. Additionally, Siemens' experience in the field indicates that the three-to-four-year implementation period that HKMC is aiming for has a good chance of success.