DELTA ELECTRONICS HYBRID POWERTRAIN

Submitted by- GROUP 5Abhaya

Abhigyan Abhimanyu

Abhinav Pande Abhinav Satija

Abhishek Somvanshi

BACKGROUND• World’s largest provider of switching power

supplies• Founded in 1971 in Neihu, Taipei by Bruce

C.H.Cheng• Manufacturing electronic components for

local TV companies• In 1974, started supplying foreign companies

such as PHILIPS, ZENITH, RCA etc.• Revenues reached $4.6 million in 1980 and

currently stand at around $3.8 billion

• Focuses on efficient use of energy with the energy-conversion efficiency reaching 96% in 2009

• Moved into Solar-Cell production in partnership with Spectrolab

• Produced solar opto-electronic modules which were used as roof panels of stadiums In 2009 World Games,Taiwan

• Aims to provide innovative, clean and efficient energy solutions to the world

ENTER THE HYBRID POWER SYSTEM FOR AUTOMOBILES MARKET

SWOT Analysis

Strength• Operating out of China (Largest market for

automobiles)• Four decades of experience in manufacturing of

energy efficient electronic components used for industrial automation

• Expertise in the manufacture of industrial and power control components used in HEV (Can make use of market adjacency)

SWOT Analysis

Weakness• No prior experience in automobile powertrains• Moving away from core competency (Electronic

component manufacturer for end products)• Little knowledge of system-level issues of

automobiles and their impact on the components and sub-systems

SWOT Analysis

Opportunity• Global shift towards cleaner and greener

forms of energy• Special emphasis of Chinese government on

green energy (Being one of its top three strategic national developmental priorities

SWOT Analysis

Threats• Being a new entrant, tier-1 vehicle

manufacturers wouldn't be willing to implement their design in whole

• Emergence of new competitors in this segment operating out of China due to cheap factors of production

• Safeguarding of IPR from copying and theft

HYBRID ELECTRIC VEHICLES

• Combines a battery and electrical drive system with an IC engine.

• Get their fuel efficiency through the combination of engine optimization and recovery of braking energy.

• Overcome the disadvantage of both pure ICE vehicles and pure battery powered ones.

• Two dominant architecture namely : the series HEV and the parallel HEV.

• In series HEV the ICE connects to generator so mechanical energy converts in electricity.

• Flexible because ICE and generator can be located at some distance from wheels.

• In parallel HEV both motor and ICE are coupled to a drive shaft.

• Electric motor acts as a generator so no separate generator needed.

APPROACH TO DESIGN

• Setting up of a separate unit to develop and supply key components for electric vehicles

• Parallel management approach to be able to leverage capabilities and move resources from one business unit to other

• Both industrial automation unit and HEV component unit headed by the same person, Simon Chang

• Parallel Approach extending below the business unit level as well

• For example two separate motor departments, one for industrial control and other for automotive, had a common manager

• Use existing cash flows for investments; investments were often not that big because of leverage of existing technologies

• Recruit new people in the organization for technologies that they did not have expertise in

• An optimum mix of people from inside and outside; the inside people being able to find resources internally

• Strategic partnership with Ricardo plc

PARTNERING WITH RICARDO

• Ricardo – independent engine R&D company working with as many as 40 manufacturers globally

• Recognised for its expertise in three main areas : engine, transmission and vehicle structure

• Provided assistance to Delta in designing a complete hybrid power train

• Enabled Delta to access the latest technology with high quality and efficient manufacturing resources

• Coverage to Delta under Ricardo patents thereby reducing the risk of dilution of brand identity and leakage of IP

• Ricardo in charge of the design task and Delta of the mass production product

• Both Ricardo and Delta could pursue customers independently as well

THE PLATFORM APPROACH

• Delta adopted Series hybrid design which led to fewer mechanical interdependencies among components

• Common platform for different car sizes – A frame. B-frame , C-Frame etc.

• Core circuitry and core design remains same for all frames

• Common platform allowed flexibility to change the dimensions and outside mounting holes to fit the individual requirements

• Customer will have to make very minor modifications

• Upfront engineering costs were lowered with the platform approach

• Design was not optimized to make complete use of all cost and performance elements that an integrated customer design might offer

• In the initial years of power supplies manufacturing Delta developed a whole series of standard units but could not sell to the market

• All the power supplies needed to be custom designed as even low volume customer needed a lot of customization

END PRODUCT AND COMPLICATIONS

• Decide to sell only components to first - tier automakers

• Would sell the entire system to second - tier makers• Designing was done for second – tier Chinese car

manufacturer• The contract was for vehicle control unit link

specifications• Delta believed the car manufacturer wouldn’t be able

to design the VCU themselves • Hence a team was assigned to come up with a back

up design, just in case

• Developed system capabilities and enhanced learning by building a test car using a hollowed out BMW

• Extensive modifications done inside the engine compartment

• Repositioning of car components in order to implement the new design

• The customer was unable to come up with his own system and agreed to use Delta’s design

• However there was one condition, “the IPR for the VCU would belong to us”

• Issues regarding the protection of their design

A CATCH-22 SITUATION

• Delta developed the VCU themselves• The customer did not have its own vehicle controller

and hence no car• Releasing the IP meant transferring key know – how

that was a huge part of Delta’s differentiation• Increased vulnerability to copying by other

manufacturers who could reverse engineer the process

• Could affect Delta’s competitive advantage in industrial automation market as well

SOLUTIONS

• Adopted "distributed intelligence" approach to system design

• Separated control into two planes- Upper layer for master control- Lower layer for execution at device level

• Execution layer consisted of feedback from sensors • Made it difficult for the imitators to implement their system• The DI approach could lose its effectiveness because of high

volume and cost pressures of automotive industry over industrial automation industry

• Instead of licensing the IPR to the customer, Delta can provide dedicated teams in order to help the customer to gain more control over the engine and performance of final vehicle

• Delta can also look into the prospect of teaming up with the customer by going M&A route or share swap in order to align the objectives of both the firms and thereby safeguarding its IPR

THANK YOU !!!