DETROIT — Inside the car, the revolution has begun.
The shot heard 'round the world might have been fired by Holland, Mich.-based Prince Automotive. At three technical centers on two continents, the automotive supplier spent six months building what Prince and parent Johnson Controls Inc. believe is the first prototype of a fully assembled, all-in-one vehicle interior.
Instead of making separate parts — an instrument panel, seats, door panels, an overhead system, a floor console and rear storage area — that only mesh during final assembly, Prince's prototype molds them into a single piece like a gigantic Lego set.
The firm calls that piece Symbiosis, the harmonious relationship among parts. Engineers are now shopping that one-piece interior to carmakers, starting on the European continent.
If it is successful, a carmaker would be reduced to a role as final assembler placing the system into a vehicle frame. A supplier's role would swell accordingly.
Other large part makers vying for the same market call this complete interior a cockpit — connoting visions of a pilot's lair on an F15 fighter — and say it will lead to a long-overdue handoff in control from carmaker to megasupplier.
Yet, some small molding shops might not take the news as well: They could face a do-or-die situation to step up their services and bear more costs. Nor are United Auto Workers union officials overjoyed by the prospect.
Nevertheless, large interior suppliers plan to shift forward. The blurring of zones between components is not some far-off, Twilight Zone concept, said Nathan Young, vice president of design for Plymouth, Mich.-based Johnson Controls Inc., Prince's parent.
``The concept itself is not what I call `wildly blue sky,''' Young said. ``We're showcasing technologies on the shelf, ready to go in the very near term. All these features and capabilities are available.''
Integrated interiors soon could be appearing on road-tested vehicles. Executives with large interior suppliers Magna International Inc. of Markham, Ontario, and Lear Corp. of Southfield, Mich., said they are bidding with large automakers to make full interiors on unspecified models.
``It's all flowing downhill,'' said Andy Francis, marketing director of Magna Interior Systems in Farmington Hills, Mich. ``It used to be our customers who were designing and evaluating vehicles. Now, suppliers will be doing most of that upfront work.''
What's more, the parts-making units of both General Motors Corp. and Ford Motor Co. plan to develop complete cockpits at the insistence of their carmaker patriarchs. Ford is especially adamant about the issue, said cockpit design manager Mark Turner of Dearborn, Mich.-based Visteon, which is owned by Ford.
``Right now, the push from Ford is to take as much as possible from outside suppliers,'' Turner said. ``They want to reduce assembly time by buying systems and take as much content as possible from us. And we're willing to do anything they want.''
To prepare for the day when Ford wants cockpits, Visteon has set up satellite plants globally to provide multiple interior parts to nearby Ford facilities. The plants, based in Europe and the United States, can make almost any interior piece except for steering columns, Turner said.
The quest for a total interior will create a larger role for suppliers, which can provide less-expensive capital and labor costs than original equipment manufacturers and have more land available, said Mitra O'Malley, principal with Novi, Mich.-based ITB Group. ``It's merely a matter of logistics and who will pay the costs,'' she said.
Integrating mix-and-match parts also will elevate the work of smaller, Tier 2 molders, said Daniel Jannette, president of Lear's technology division. Lear is developing a stable of suppliers to help with design and development, he said.
Yet, he warned that suppliers will have to step up their services if they expect to work with Lear. Many suppliers have yet to meet Lear's standards, he added.
``The systems work we'll be expected to do can drive serious overhead in research and design,'' Jannette said. ``It would be foolish to put all those fixed costs on the backs of the Tier 1s. The economics will force us to rely more on our suppliers.''
Lear is counting on its suppliers to develop in-house design services and tooling, and to manage programs better for specific parts.
Many suppliers have kept on their toes. One smaller interior-parts producer, Circle Plastic Products Inc., upgraded its entire design area last year, said President Don Greenlee. The Circleville, Ohio, family-owned business, with sales of about $25 million, now is investing another $600,000 to expand its information systems.
The firm also is spending more time meeting with Lear, JCI and other interior suppliers to help design integrated products, Greenlee said.
``Everyone says you have to be monstrously huge to succeed in [auto interiors],'' said Greenlee, whose company injection molds small parts for seats and doors. ``But if you pick your niche and do a superior job with your customers, you can do fine. If you're a shoot-and-ship molder, you won't last long.''
In the new world order, Lear would act more as an interior integrator, tying together the in-sync parts, Jannette said. The firm also would take on a greater purchasing role for both parts and materials, a practice now under the thumb of most OEMs.
``I think the changes are really revolutionary,'' said Craig Fitzgerald, partner with Southfield, Mich.-based Plante & Moran LLP. ``[A supplier] that once sold a hard product will now sell its softer capabilities in design and supply-chain management. They'll be handsomely rewarded in increased shareholder value.''
The trickling down of parts design also could drive a new round of consolidations among smaller processors, said David Cole, director of the Office for the Study of Automotive Transportation at the University of Michigan in Ann Arbor, Mich.
``It could accelerate in the next year or so,'' Cole said. ``Manufacturers all want to simplify their supply base and work in greater depth with fewer suppliers. It's easier to work closely with 100 suppliers than it is with 1,000.''
This year, interiors suppliers such as LDM Technologies Inc. in Auburn Hills, Mich., and Key Plastics Inc. in Novi, Mich., have made acquisitions to become broader-based companies.
``The key for us is to have a handle on core manufacturing technologies,'' said Mark Kubat, director of new business development for Magna's trim panels group. ``We don't have to make everything, but we have to have expertise in each area.''
Magna got a taste of the trend recently when it served as program manager for Ford's new Lincoln Navigator sport utility vehicle. For the first time, the company supervised work on an entire interior, including gathering Tier 2 suppliers, material suppliers, tool shops and Ford engineers early in the design process.
By taking the reins, the company was able to complete development in 26 months, Kubat said. Ford typically takes as long as 36 months to launch a new platform, he added.
Yet, most large interior suppliers do not expect that work to begin in earnest for about a decade. First, they must decide on the most efficient methods to make a complete interior, Kubat said.
Politics also come into play. Carmakers are not necessarily willing to cede control to suppliers for product design, engineering and testing.
``It's a power issue,'' said Donna Parolini, president of International Business Development Corp. in Troy, Mich. ``The designers and engineers at an OEM don't want to be out of a job. It's normal and going to happen, but it will take a major behavioral change on the part of an OEM.''
In addition, carmakers are reluctant to give one company full responsibility over all interior functions, Fitzgerald said. They are afraid — and rightly so — that prices eventually will rise if a small pool of suppliers controls the industry, he said.
Yet, cost figures justify the investment in suppliers, said Paul Palovich, business manager for modular cockpits with Delphi Packard Electric in Warren, Ohio. Studies show that integrated parts developed by suppliers can yield a 10 percent weight reduction, use 20 percent fewer parts, lessen warranty costs by as much as 55 percent and offer double-digit cost savings, he said.
``But OEMs have to give us much responsibility in key areas of a vehicle for that to happen,'' said Palovich of Delphi, GM's parts-making unit. ``That's where we believe the market is heading. But we must earn a greater degree of trust for that to happen.''
Lower labor rates in supplier plants also make outsourcing attractive. But to do that, OEMs must fight the UAW. Outsourced parts have been a major battleground in several recent strikes, especially those waged against GM.
The UAW believes OEMs can make integrated interiors as inexpensively as can suppliers, said spokesman Reg McGhee of the Detroit-based union. Before products are transferred to a supplier, many union contracts require bidding by OEM plants to keep parts internally.
With major issues to overcome and design dilemmas to work out, many experts predict the first full interiors to roll off the line by about 2004.