Joint research on electrical and electronic architecture: a small step for Xpeng and a big step for Volkswagen in China

Volkswagen is the first enterprise of the world's automotive giant to invest in China's new car-making forces, and the two sides have entered the cooperation of software cooperation and then entered the technical bottom of the automotive electronic and electrical architecture, which has promoted the two-way communication between China and Germany to a new stage of "you have me, I have you".

Text丨Zhijia.com Li Muyu

Editor丨Langlang Mountain and Mingzhi Mountain

Although the chairman of the Volkswagen Group did not accompany German Chancellor Olaf Scholz on his second visit to China like Kang Linsong, chairman of the board of directors of Mercedes-Benz Group AG, and Zipzer, chairman of the BMW Group, Volkswagen Group (China) Chairman and CEO Braid Braid released a series of blockbuster news during Scholz's visit to China, which raised the cooperation between China and Germany in the automotive industry to a new height.

What is the further cooperation compared to the joint venture?

It is technology sharing and technology joint research.

On April 17, Richard said: "Our cooperation with Xpeng Motors has made new progress. I am proud to introduce our new E/E architecture, CEA, based on zone control and quasi-central computing. The architecture was developed by technical experts from Xpeng Motors, Yuanhua (Zhonghua Technology Co., Ltd.) and @CARIAD China. From 2026 onwards, we plan to use it in locally produced Volkswagen-branded electric models. ”

This is a further deepening of the cooperation between the Volkswagen Group and Xpeng on the basis of the joint development of two Volkswagen brand electric vehicles.

01.

What is the joint development of electrical and electronic architecture?

On the occasion of the 40th anniversary of the Volkswagen Group's entry into the Chinese market, it is accelerating a new round of layout and adjustment, and before the Beijing Auto Show, it has continuously released heavy news, all aimed at systematically promoting the digitalization of its product portfolio.

The aim is to accomplish two goals:

1. Speed up product iteration efficiency;

2. Maintain Volkswagen's share of the Chinese market.

At present, it is no longer a time cycle for Chinese and foreign car brands, especially Chinese local brands and joint venture brands, to change their models, and the Volkswagen Group is obviously the only brand among the three German giants that recognizes this, accepts this reality and actively seeks to change.

"In the Chinese auto market, models are updated every three years, architecture is upgraded every two years, and vehicles are updated by OTAs every month, and Volkswagen China will keep up with this rhythm," said Brad. ”

In the Chinese market, the efficiency improvement of local brands, especially new forces, is mainly due to the adoption of the latest EEA Electrical/Electronic Architecture (EEA) at the bottom of the car and the beginning to embrace central computing.

This architecture lays the foundation for OTA global upgrades.

This time, Brad announced that Volkswagen and Xpeng Motors will jointly develop CEA, an electronic and electrical architecture based on zone control and quasi-central computing, which is the first step that Volkswagen must complete to catch up with the iterative efficiency of Chinese competing models.

So what is the difference between the CEA structure and what we often call the EEA architecture?

Volkswagen China's explanation is that the electronic and electrical architecture jointly developed by the two parties is named CEA, and C stands for CHINA.

This is a way of naming to show the cooperation between the two parties.

This can be understood as the fact that the Volkswagen Group will first adopt this architecture in its locally produced models, which in turn will be ahead of its global model generation.

Xpeng's introduction to its EEA architecture is that software such as intelligent assisted driving software and Internet of Vehicles operating system can be decoupled from the underlying hardware and vehicle platform to achieve rapid iteration of cross-platform software.

Its latest-generation E/E architecture uses a central computing and domain controller-based architecture to provide a high-performance in-vehicle computing environment with a competitive cost structure. The E/E architecture supports high-speed data transmission over Gigabit Ethernet between the central domain and the driver assistance domain controller. A large number of electronic control units are integrated into the domain controller, resulting in a highly integrated architecture and a competitive cost structure. The E/E architecture also supports efficient vehicle OTA, providing high-speed OTA for end-user vehicles and off-line vehicles.

If we call the engine and gearbox the core technology in the era of fuel vehicles, then the electronic and electrical architecture is the core of the era of intelligent electric vehicles.

Whether it is intelligent driving, intelligent cockpit and battery system, it is based on this architecture that can be competitive in the market, and chips and batteries can be useful.

This is the root of attachment to the soul of smart cars.

In other words, this kind of cooperation goes beyond Huawei's Hongmeng Zhixing model, and is a frank meeting of the core technologies of the two sides.

As for the organizational form of the cooperation between the two parties, the official statement of the Volkswagen Group is that this structure, which was jointly developed by technical experts from Xpeng Motors, Volkswagen (China) Technology Co., Ltd. (VCTC) and CARIAD China, a software company of the Volkswagen Group, will ensure the rapid expansion of digital services for the Volkswagen brand's local electric models.

"What does the CEA architecture mean for our users: Advanced functions and digital services, including autonomous driving, will be seamlessly integrated into the vehicle, and it will also significantly reduce the complexity of the intelligent electronic control system in the vehicle, reducing the number of controllers by 30 percent," said Braid. This will further enhance our cost competitiveness. ”

However, the new architecture will not be available in locally-produced Volkswagen-branded EVs until 2026, at the same pace as the launch of the two models that Xpeng is working on.

Volkswagen China said that the CEA will cover four all-electric models of the Volkswagen brand based on the CMP platform and developed for the compact entry-level market.

This means that CEA will be applied to a total of six BEV models.

The CMP platform is a next-generation vehicle platform jointly developed by VCTC and joint ventures SAIC-Volkswagen and FAW-Volkswagen, and aims to reduce costs by 40% compared to the well-known MEB platform.

The main means of cost reduction is to reduce the complexity of the system and reduce the number of controllers in the vehicle, and the CEA architecture will make an important contribution to the realization of this goal.

Commenting on this collaboration, He Xiaopeng, founder of Xpeng Motors, said: "The common pursuit of technological innovation has brought Xpeng and Volkswagen together. ”

Another point worth paying attention to in this cooperation is the team of the two parties, which can be said to be a tripartite team in the strict sense.

CEA's R&D team consists of technical experts from Xpeng Motors, Volkswagen (China) Technology Co., Ltd. and CARIAD China.

The joint team will strengthen the software-oriented development approach, drive the development of advanced technologies, including autonomous driving and next-generation connected functions, and build an E/E architecture based on zone control and quasi-central computing – including zone controllers, central computing platforms, cloud platforms and back-end connectivity – that can be quickly and cost-effectively integrated into Volkswagen-branded vehicles.

Although Volkswagen (China) Technology Co., Ltd. and CARIAD China are both from the Volkswagen Group, VCTC is clearly the leading party.

VCTC has only been established for a short time, but its position is gradually alongside the headquarters of the Volkswagen Group in Wolfsburg.

02.

Germany's local R&D is ahead of its competitors

During Auto Shanghai 2023, the Volkswagen Group announced an investment of 1 billion euros to establish a R&D, innovation and procurement center in Hefei with a focus on intelligent and connected electric vehicles.

In January this year, Volkswagen China Technology announced that it would put into operation, focusing on the research and development of intelligent connected vehicles, which is regarded as the largest R&D center of the Volkswagen Group outside its headquarters in Germany, and the so-called Wolfsburg has moved 9,000 kilometers east.

Its first goal is to reduce the time-to-market of automotive and component products by 30% through an efficient product development process and the application of cutting-edge technologies.

The company's role in China is also an important interface for the Volkswagen Group to connect with joint ventures and local partners.

In other words, R&D is only one of its responsibilities, and the second of its missions is to represent the Volkswagen Group in the Chinese market.

According to the Volkswagen Group, VCTC, as the core of the Volkswagen Group Innovation Center in Hefei, integrates R&D, innovation and procurement functions, integrates all R&D departments related to the development of local models, and realizes local decision-making.

Localized decision-making means that there is no need to consult Wolfsburg for everything.

Therefore, in private, VCTC has the name "Little Wolf Castle".

Volkswagen China's first task was to develop the Volkswagen Group's first e-mobility architecture (CMP) specifically for the Chinese market.

According to reports, by the end of this year, VCTC will have more than 3,000 R&D and procurement experts involved in the development of new intelligent connected electric vehicle models. CARIAD China currently has more than 1,000 experts.

For the CEA architecture, VCTC and CARIAD China will work closely together to shorten the development cycle by 30% and bring innovative products to customers faster.

Prior to the announcement of this cooperation, the VCTC was headed by Thomas Ulbrich, CTO of Volkswagen China, on April 1 this year, and the head of CARIAD China was replaced by Han Sanchu a month ago.

At the same time, on April 11, Volkswagen China announced an investment of 2.5 billion euros, or about 19.2 billion yuan, on the occasion of the German Chancellor's visit to China, to further expand its production and innovation center in Hefei to strengthen local research and development.

Volkswagen is currently the company with the strongest sense of crisis among the three major automobile powers in Europe, the United States and Japan.

The Chinese market is not only the most important market for the Volkswagen Group in the world, but also the market that makes it the most anxious.

In 2023, Volkswagen delivered a total of 3.236 million vehicles in China, an increase of 1.6% over 2022. A total of about 191,800 pure electric vehicles were delivered, an increase of 23.2%, and the best performance among joint venture brands.

In the first quarter of this year, the Volkswagen Group delivered 2.1 million vehicles worldwide, up 3 percent year-on-year. Deliveries in China totaled 693,600 units, up 8% year-on-year. In China, deliveries of BEVs increased strongly by 91% year-on-year to 41,000 units.

While all the figures are growing, it is an indisputable fact that the Volkswagen Group's share of the Chinese market is declining year by year, from 18 percent five years ago to 14 percent last year.

03.

Volkswagen's bottom line, the share must not fall below 10%

Although Volkswagen's management is becoming more pragmatic and ready to accept a further decline in market share, it believes that a market share of more than 10% is already "very substantial". But this is actually a red line drawn by the public for itself.

Speaking at the 2023 World New Energy Vehicle Conference, the Volkswagen Group has set a clear goal: to maintain its position as the number one international car company in China and play a leading role in the era of intelligent and connected vehicles. To this end, the Volkswagen Group has formulated a Development Plan for 2030.

The plan is threefold:

First, it will strengthen its dominant position in the fuel vehicle market and extend it to the field of new energy vehicles, and use the profits of the fuel vehicle business to provide financial support for the development of the intelligent networked vehicle business.

Second, accelerate the offensive of pure electric products, and plan to introduce more than 40 new models to the Chinese market in the next three years - half of which are new energy vehicles. By 2030, at least 30 BEVs will be available in the Chinese market.

Volkswagen Anhui will launch its first model for the Chinese market, the ID.UNYX, this year, further enriching the Volkswagen brand's portfolio of pure electric models.

Changchun-based Audi FAW New Energy Automobile Co., Ltd. started production of its first model based on the PPE platform at the end of this year: the Audi Q6 L e-tron.

The Audi brand and SAIC Motor will jointly develop an intelligent and connected model that will be launched in 2026.

The Volkswagen brand and Xpeng will launch two all-electric models of the Volkswagen brand for the B-segment car market in 2026, the first of which will be an SUV model.

Volkswagen (China) Technology Co., Ltd. will launch an electric vehicle architecture (CMP) dedicated to the Chinese market in 2026, developing no less than four compact electric models for the entry-level market.

Third, we will rapidly expand the Group's local R&D capabilities and establish partnerships with leading local companies to accelerate the introduction of new products to market.

In June last year, the Volkswagen brand announced a plan to cut costs by 10 billion euros by 2026, and its software subsidiary CARIAD cut 2,000 employees.

There is clearly a consensus among the public that there is no room for error in the Chinese market.

Five days later, at the Beijing Motor Show, a total of 44 models were on display, with a total of six world premieres and five Chinese premieres.

▲The Volkswagen brand will bring a concept model specially built for Chinese customers

This includes not only strategic pure electric models, but also plug-in hybrid models, which are growing significantly in the Chinese market, which is obviously a change in response to the changes in the Chinese market.

Volkswagen is the first enterprise of the world's automotive giant to invest in China's new car-making forces, and the two sides have entered the cooperation of software cooperation and then entered the technical bottom of the automotive electronic and electrical architecture, which has promoted the two-way communication between China and Germany to a new stage of "you have me, I have you".

In the 40 years since Volkswagen entered China, with more than 90,000 employees, more than 3,500 dealers, 39 factories, and more than 50 million car users, the Volkswagen Group has long been an indispensable part of China's automotive industry system. Without the successful transformation of the Volkswagen Group, the electrification of Chinese cars would not be complete.

China is not an island of smart electric vehicles, it is an innovation hub that brings together brave and enterprising car people, and if the joint venture brands remain suspicious and suspicious of the Chinese market, they will lose this historic opportunity for transformation.