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Fiat Chrysler Wants To Share Components

By raccars Published

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Fiat Chrysler Automobiles is encouraging industry mergers after commissioning an independent report, suggesting that car manufacturers could save billions by sharing components, such as transmissions and even engines.

The 25 page report makes a case for the widespread sharing of development and engineering between auto manufacturers, and even sharing factory space. The presentation suggests that mass merging could alter the auto industry and help it survive the challenges of the changing modern market.

The report claims that automotive firms have spent increasing amounts on research and development since the beginning of the financial crisis in 2008. R&D by the world's largest auto manufacturers totalled £55 billion in 2008 but had gone up to £87 billion by 2014. The report predicts that these costs are likely to rise even further, as firms strive to create ever more sophisticated safety systems, more efficient engines and develop autonomous driving technology.

Having broken down and analysed how those monies are spent, Fiat Chrysler has determined that about half turn out to be indiscernible by the customer - in other words, drivers can't really tell the difference. Furthermore, powertrain and transmission technology is now overlapping significantly between brands, as a result of CO2 and emissions strictures. Under the circumstances, FCA recommends the integration of research and development and production, and sharing components across mainstream brands. To avoid brand image dilution, automotive brands could concentrate more resources on branding and individual design.

Mobile phone manufacturers already use a similar system, sharing software and processors between a number of different brands using third party production facilities.

However, this level of industrial integration is a slow process. At the moment, the major manufacturers each boast about 18 separate platforms - about 20% fewer than they had in 2004. Each of these platforms can be topped with an average of 3.3 different body shells, nearly a third more than in 2004.

Reducing this level of separate architectures could benefit the entire industry. As part of the report, Ford claimed that it is working on reducing its current 12 global architectures to nine by next year and eight in the longer term. While some manufacturers may be loathe to share their technology, the degree of financial pressure facing major manufacturers could make the idea of saving large amounts of money a tempting prospect.

Sceptics, however, claim the report suggests that FCA is desperately trying to engineer a mega merger, to ensure its financial survival.

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