~ How automotive OEMs can reduce obsolescence risks ~
With thousands of parts per car model expected to become obsolete each year, obsolescence presents a huge challenge for automotive manufacturers. But what makes obsolescence so threatening to the car manufacturing sector, and how can it be avoided? Here, Ross Turnbull, Director of Business Development and Product Engineering at ASIC design and supply company Swindon Silicon Systems, explores.
For many purchasing and procurement professionals, obsolescence is a source of concern. Receiving notification of a product becoming obsolete will often raise multiple questions: What next? Is an alternative available? How will this affect the production line?
And it seems some sectors are more prone to obsolescence issues than others. The automotive industry, for example, is one that is increasingly struggling with the challenges of obsolescence. In fact, consultancy company Oliver Wyman estimates that some 3,000 parts per car model are expected to become obsolete every year. To understand why this is the case, we need to dig deeper into the factors behind component obsolescence.
Understanding the challenge
Obsolescence usually occurs as a result of the technology or functionality becoming out-of-date, a drop in market demand, lack of compliancy with new regulations, or a combination of these factors.
In automotive technology, the unprecedented rate of development is a huge driver for the former. Cars are smarter than ever. Where our vehicles were once entirely mechanical, we’re now seeing increasing digitalisation throughout. This includes lane and hazard detection systems, automatic parking and even completely autonomous driving — all a result of more advanced electronics. The caveat is, that the faster these developments occur, the quicker components become obsolete — potentially much earlier than initially forecast. Consultancy firm Roland Berger estimates that some 62 per cent of the automotive market relies on older, more specialised chips. And as chip manufacturers are moving to more advanced technologies, there’s less and less availability of these older components for OEMs. As a result, manufacturers are having to spend more time dealing with supply chain problems and sourcing suitable chip replacements.
Another factor is the sheer number of components used in the automotive industry. Estimates put the number of chips per vehicle anywhere between 1,000 to 3,000. And with the continuing transition to electric vehicles, these figures are only set to grow. Evidently, manufacturers must seek new strategies to manage obsolescence concerns if they’re to keep up with a dynamic, evolving market. The question is, how can this be done?
Managing obsolescence
Often, obsolescence is managed reactively, after the process or component has been deemed obsolete. But the problem with reactive management strategies is it leaves little room for error, and potentially a big hole in the manufacturer’s pocket.
Finding an alternative source can be tricky. Any replacement chips must be verified before use in the application. And there’s often significant redesign work required to ensure that the product is compatible with the substitute device. Even if a suitable chip is found that doesn’t require any product design changes, it’s unlikely to have the same performance or functionality as the original IC.
Sourcing the right supplier can be just as difficult. There’s always the concern that a third-party supplier can’t deliver components to the quality demanded by the application. Their supply chain must also be questioned. It’s no good to shift production to a new chip if the replacement is also expected to go obsolete.
A proactive approach
To minimise these issues, it’s preferable to take a proactive approach to obsolescence. In part, this comes through enhanced supply chain management and transparency, as well as more accurate business forecasting.
It can also be achieved through the design of the chip itself. An Application Specific IC, or ASIC, is a bespoke chip that has been designed uniquely for custom requirements. As a result, the ASIC can be optimised down to the finest detail, offering improved performance, functionality and power consumption compared to off-the-shelf solutions.
Besides performance enhancements, the ASIC route also offers several benefits to those wishing to avoid obsolescence concerns. Commonly, chip obsolescence occurs due to two factors: either the silicon process or the packaging becoming obsolete.
An ASIC designer is always working proactively to avoid these. While sourcing packaging alternatives is relatively simple, silicon obsolescence requires a little more pre-planning. Typically, this is done at the earliest stage possible, where the ASIC supplier will select a silicon process and foundry with the required maturity and longevity to match the product’s lifespan.
In the unlikely event the silicon process still becomes obsolete, the ASIC supplier will provide at least a years’ notice, offering ample time for a suitable solution to be found. The ideal resolution is individual to the customer and its application. For short-term production, for example, a one-off purchase of fully packaged parts may be suitable for the quickly changing demands of automotive electronics.
The IC design can also be ported onto a new silicon process, or the ASIC designer and customer can embark on a completely new design altogether. Regardless of the route taken, this decision-making process must be taken collaboratively to ensure that the solution works for the customer and the product.
Industry expertise
For manufacturers in the automotive sector, there’s a strong case to be made for working with IC designers with the same industry experience. Finding an ASIC designer already knowledgeable about your application means they can often provide additional insight, whether it’s meeting industry regulations or keeping up to date with the latest trends such as ultra-low power requirements.
Swindon, for example, is a global leader in the design and supply of ASICs for the automotive sector. Having been at the forefront of TPMS technology since its inception and now fulfilling more than half the world’s total demand for TPMS sensors, Swindon is well-versed in the unique demands of the automotive electronics industry. It can offer full compliance with strict ISO 26262 standards as well as AEC Q100 stress testing. As a result, Swindon is perfectly placed to help manufacturers navigate the challenges associated with the sector, including the ever-present risk of obsolescence.
As our cars become more and more complex, the number of automotive electronic components continues to increase. And as a direct result, it seems obsolescence is set to become an even more pressing issue. But by taking a proactive management approach, developing custom electronics and working with trusted suppliers, manufacturers can reduce the risk of obsolescence — even in the most demanding of sectors.
