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R&D: Southeast Michigan Conducts Research and Development for Global Auto Industry

By James Amend

Pages 18-19When Toyota set out to redesign its important new Avalon sedan, a five passenger, full-size car most popular in the U.S., the automaker turned to its technical center in Ann Arbor to lead the design and engineering of the vehicle.

“It’s definitely an American-based car,” said Bruce Brownlee, senior executive director at the Toyota Technical Center.

The 2013 Avalon marks the fourth generation of the vehicle, first introduced in the U.S. in 1995, and the Toyota Technical Center has had a hand in each iteration. But this time the car’s development was led by a North American-born chief engineer and for the first time all decision-making on it was conducted by a North American executive team, whereas those critical choices were formerly made in Japan.

Toyota’s approach to designing and engineering the Avalon underscores a larger automotive industry movement, where automakers leverage large-scale satellite research and development units at global locations containing high degrees of expertise and autonomy to add local flavor to new products and technologies.

The practice also gives automakers the opportunity to collaborate more closely with independent design and engineering firms in the region, local colleges and universities, and now with each other more than ever.

The approach has transformed Southeast Michigan, long known as the automobile capital of the world, into an even greater global research and development powerhouse. No longer is the region’s research and development expertise confined to the walls of General Motors, (GM), Ford and Chrysler.

In fact, six of the top seven largest automakers, including Chrysler, Ford, GM, Hyundai and Kia, Nissan, Toyota have headquartered research and development (R&D) centers in Southeast Michigan. Another eight global automakers have an R&D presence in the region and countless numbers of suppliers work on advanced research in the region.

Southeast Michigan accounts for about $8 billion of the annual $10 billion spent on national automotive product development and R&D, according to the Center for Automotive Research in Ann Arbor. Nationally, automotive represents roughly 76 percent of the product development and R&D spending to occur in a single year.

CAR estimates 100,000 electrical, industrial and mechanical engineers work in the R&D field in Southeast Michigan. For every job they fill, 2.5 more support jobs are added elsewhere for a total R&D employment of some 250,000 people.

“That’s nothing to sniff at,” said Sean McAlinden, executive vice president of research and chief economist at CAR.

“We have a very powerful block of engineering and scientifically degreed people working in the auto industry,” he said. “If you want to be an engineer, you have to be here. If you want to hire an engineer, you have to be here.”

The 35-year-old Toyota Technical Center employs more than 1,100 people who are engineering, designing and evaluating vehicles. It also conducts materials research, powertrain engineering, prototyping, safety research and advanced research, as well as some regulatory affairs work. It retains core development responsibility for a number of vehicles in addition to the new Avalon, such as the Camry midsize sedan, Sienna minivan, Tundra and Tacoma pickups and the Venza crossover and RAV4 crossover electric vehicle.

“The goal is to have North American cars designed, engineered, manufactured and sold in North America for North American customers,” Brownlee said.

Toyota’s Southeast Michigan R&D unit also conducts important advanced safety work from its year-old Collaborative Safety Research Center (CSRC). The CSRC collaborates with North American universities, hospitals, research institutions and government agencies to improve road safety.

One key area of research includes the growing safety phenomenon of driver distraction, where Toyota works with Wayne State University on a solution targeting cognitive distraction.

But the work performed at the Toyota Technical Center is just a snapshot of the R&D work occurring in Southeast Michigan and the pace of change in the field is accelerating, chiefly with regulatory demands for significantly greater future fuel efficiency and lower carbon dioxide emissions.

In addition, consumer demand for sophisticated infotainment devices linking with their mobile devices is at a fever pitch, and there are safety issues the industry’s R&D houses must solve.

“Technology is evolving really, really rapidly in automotive today across a wide variety of fronts,” said Jon Laukner, chief technology officer and vice president of global research and development at GM.

Laukner’s position itself was driven by quickly advancing technologies. As CTO, a position GM created less than two years ago, he is responsible for keeping the automaker on top of emerging technologies. Keeping up with those advances can be challenging, because breakthroughs in electronics occur in the context of months while automaker product cycles are measured in years.

As such, GM has started going outside its organization to stay ahead of coming technological advances. It combines the best of what it does in-house with ideas from its suppliers and an innovative new organization of the automaker called GM Ventures.

GM Ventures invests equity in start-ups developing new automotive technology. Should the technology make it to market, GM gets first dibs.

Laukner calls the strategy “Develop, Invest and Partner.”

“We’ll take the best of what the outside can offer, we’ll take the best of what we can offer, and we’ll do something remarkable,” Laukner said.

“That is going to be the way forward for us; because the breadth of technology out there is so vast that it really exceeds our ability to keep track of it and for us to invest in it all by ourselves,” he said. “So we need to leverage sources of technology other than what we develop in house.”

GM has invested millions in startups so far, ranging from electric-vehicle producers to firms experimenting with advanced lightweight materials to shave pounds off vehicles and make them more fuel efficient.

Ford and Chrysler take much of the same approach.

Chrysler’s advanced research kicked into high gear three years ago when Italian automaker Fiat purchased it out of bankruptcy. Chrysler already operated one of the industry’s broadest R&D units, with engineering research, design, fabricating and testing all under one roof in Auburn Hills.

Chrysler now has access to Fiat’s strength in advanced, fuel-saving combustion technologies to complement its traditional strength in engine validation. Fiat also enriches Chrysler’s vehicle durability research.

Ford’s research and development group celebrated its 65th anniversary last year, pledging it would open its doors to collaboration wider than ever before.

“Traditional collaboration with automotive partners and suppliers may be what we are used to and comfortable with, and we want those ties to get even stronger,” said Paul Mascarenas, Ford’s chief technical officer and vice president, research and innovation. “But it is also time to accelerate and embrace new forms of collaboration outside the automotive realm that will help us create not only better transportation, but a better world.”

For example, Ford recently entered into multiple-year research projects with several universities around the world to study electric vehicles (EV), driver behavior and the latest forming methods for lightweight materials and batteries for EVs.

The changing R&D landscape is also opening opportunities locally.

Subhash Dhar started Troy-based Energy Power Systems two years ago. The firm focuses on designing and engineering high-power, low-cost energy storage systems for hybrid vehicles and smart grid applications.

Dhar believes partial electrification, such as Micro. Mild and strong hybrids including the stop/start system and e-assist systems currently available on the Buick LaCrosse sedan or the battery assist system of the Toyota Prius hybrid, will provide the answer to rising U.S. fuel economy standards.

Energy Power Systems, in a nutshell, applies materials modifications and a unique design to improve the power of old-fashion lead-acid batteries. That makes for lowered cost electrification, a big stumbling block for advanced chemistry batteries, such as lithium ion.

In the short lifetime of Dhar’s firm, employment has grown from 8 people to 30. The company’s technology has entered the product development phase, has partnered with a number of local universities for additional research, and is on the brink of manufacturing their batteries.

James Amend is a Metro Detroit freelance writer.