Looking Beyond Detroit For Engine Innovation 290
waderoush writes "Opposed-piston engines (with two pistons in the same cylinder) have been around since the 1920s, but have been used mainly in submarines and airplanes. Now, several startups are working to make these high-efficiency engines practical for cars, trucks, and light vehicles — but they're under no illusions that Detroit will adopt the idea. Silicon Valley startup Pinnacle Engines, which is backed by the world's largest venture fund, is looking to a scooter manufacturer in India as its first partner. 'This ought to be music to Detroit's ears, but to them I'm just some whacko in California,' says Monty Cleeves, Pinnacle's founder and CTO. 'This is Silicon Valley, and what does Silicon Valley know about making engines? Folks in Asia have almost zero "not-invented-here" issues, whereas it's pretty prevalent all over the U.S.'"
Two points (Score:5, Interesting)
“There are 50 opposed piston engine companies out there, and they all haven’t gotten to the point where they’ve figured out what their Achilles’ heel is,” says Byron Shaw, general manager at GM’s Advanced Technology division in Palo Alto. “It’s unlikely that [the engine startups] have discovered something that isn’t known,” he continues. “Let’s say they really improve the ability to run air flow ratios super lean, but then they haven’t solved the NOx problem [nitrogen oxides, a by-product of combustion and the source of smog and acid rain]. There is always a ‘but,’ and most of these companies haven’t gotten to the ‘but’ yet. In India and China they don’t have any idea what the ‘but’ is. They are a pure growth trajectory. But as those markets mature, so will their expectations.”
and the best part:
As if to illustrate Cleeves’ point, Shaw tells a story from his days as a young, just-out-of-college engineer at GM in 1988. “I came up with this change to an internal part of the air conditioning compressor,” he says. It was part of a project to switch over to a new, environmentally safer coolant. “It passed every test. I was rocking and rolling. I was going to change the world. My boss said, ‘Okay, why don’t you get on the plane and go down to the plant and tell them all about it.’ So I go down there and I start to give my spiel. And the plant manager says, ‘Let me give you a tour of the factory.’ “He shows me where the blank aluminum comes in and where it’s machined and processed. And then he takes me down this line of machines. There are 320 steps and each machine does one step and it’s really fast and precise. And at the end of the line this part rolls off. And he says ‘The part you want to change is machined on step number two. And on every machine after step number two, that’s where they grab the part and hold it to do all the subsequent machine steps. So we’d have to retool 320 machines. Is your change that good? How much more are people willing to pay for their cars based on the improved performance from your little part change, versus what it’s going to cost the company?’ That was a really interesting lesson for me.”
Re:Full of it (Score:5, Interesting)
The reason 'Detroit' haven't done anything with the startups is because they have their own R&D factories. Why partner when they can do it themselves better and cheaper?
Because when technology is purchased, it is considered an asset, and appears so on the balance sheet. Internal research and development organizations, however, are viewed as liabilities, since they have payroll and other continuing expenses. It's an accounting advantage when outside technology, either in the form of entire companies or just their IP, is purchased.
Said another way, the external technology has a value that is explicitly recorded on the balance sheet. The value of technology created by the internal R & D organization, OTOH, is not explicitly realized. One reason for this is that its valuation is quite difficult to determine (unless it's sold outside the company, of course, when it becomes worth what someone is willing to pay for it). Case in point: Your company's R & D organization develops a new opposed-piston engine technology. How much is it worth, in a dollar figure justifiable to an external auditor? Could someone make an equally reasonable argument for a figure one-tenth that of yours?
Re:OF course (Score:5, Interesting)
Have you ever worked with Detroit? I own an auto industry startup who's dealt with top-level Detroit execs on a number of occasions. The auto industry is an extremely conservative industry with a very backwards business model and an exceedingly slow cycle time, hamstrung by regulations, supply agreements and partnerships that perpetuate the status quo. And they know all of this stuff, and it drives them crazy, because every exec has about a dozen big ideas for what they want to do but can't for some reason or another. At the same time, they have a formula that works, keeping them competing in an industry that tends to eat new know-it-all manufacturers for breakfast.
I wish the new startup well, and I wish I could say it's just a case of "may the best tech win". But it's not really. First off, Detroit is an "Old Boys Club", so a lot of their success will have to do with how well their team can infiltrate the culture, winning over power-brokers and former power-brokers who still have lots of buddies in the company, one rung of the ladder at the time. Secondly, you have to play by their rules. That means meeting over obscenely expensive dinners and drinks (and, from what I've been told, although I've thankfully been spared this for obvious reasons, strip clubs). And third, even when you do things right, it's slllllllllooooooooowwww. Assuming you do things right, have a good product, and properly cover your arse legally, and nobody scopes you to the field first, whether with independent development or ripping you off.
That said, startups *can* and *do* regularly make it in the industry, at least as suppliers. Although going from nothing to being a whole engine supplier is a pretty huge step, and they really should start out smaller. Honestly, given their situation, I'd strongly advise trying to work their way into some of the Tier 1 suppliers. It should be a lot easier than approaching the Big 3 directly (I really wouldn't expect them to give this startup the time of day).
Re:Cost and uncertainty (Score:3, Interesting)
Nor have the foreign car makers been "doing it for years".
30mpg? yes, years. Maybe decades.
If you make a big heavy vehicle it is going to get crappy fuel efficiency. US consumers, for better or worse, love big heavy cars. All automakers know how to make more fuel efficient cars but those are not the ones most people buy.
There's a disconnect here. If people are buying big heavy cars which aren't fuel efficient, why did the US auto makers need a bailout? Because consumers were still buying cars, they just weren't buying the cars the big three were making.
Furthermore when your most profitable vehicles are the least fuel efficient (true for every auto manufacturer) and best selling, that is a major problem.
This appears to be the source of the disconnect. If the car manufacturer is being outsold in the small and medium car markets, then their bestsellers being the largest and most profitable cars is irrelevant. It appears that for every large car sold dozens of small and medium sized ones are sold. And the big three weren't selling those. Hence why they hit the wall and needed a bailout.