Henrik Wenders, VP Marketing at Byton: "A white sheet, discipline and knowhow"
Byton is where the automotive industry and artificial intelligence meet. It unites former BMW i, Tesla and Infiniti professionals with Google and Apple people to create what it calls the next-generation smart device. By next year, i.e. in just three years’ time, it should have its first model ready for launch.
How does it succeed in developing and building such a sophisticated, hyper-connected premium electric crossover in such a short time span – and sell it at just €40,000? We talked to Henrik Wenders, VP Marketing, during the European presentation of their concept car in Milan.
Uniting automotive with electronics experts to build a complex machine, that sounds rather challenging.
HW: It is a challenge indeed. The automotive part and the consumer electronics part are equally represented and equally important for us. It is crucial that we create a common culture. It cannot be a case of “Slow old-school automotive guys versus fast and cool software guys”. The consumer electronics specialists have to acknowledge that to build a car, you have to take strategic long-term decisions. The automotive environment is not flexible, as opposed to the software environment. Discipline is of the essence. Otherwise you end up with short-term changes, production delays, and so on.
Next to discipline, there must be other factors that allow you to develop a sophisticated car from scratch in such a short time span. What is your secret?
HW: First of all, we are starting from a white sheet of paper. There are no elements that we must reuse from other cars, there is no industrial heritage, so to speak. Second, we are not tied to one supplier or another. We can take those elements off the shelf that fulfil our criteria, without any politics being involved. For the features with which we want to differentiate ourselves, like the screen and the HMI, we have to invest in R&D, of course. This might take a bit longer, but everything will be ready for the start of production end of 2019.
A short development time saves money, but that is not enough to explain why you can offer your car at half the price of a Tesla Model X, is it?
HW: A proper product management right from the beginning is key. We avoided making our car a festival of engineering and technology, because that makes a car expensive and therefore too exclusive. You have to clearly define your target, your standard equipment, your optional equipment, think about the proper packaging, and that is how you can develop a car that starts at €40,000. Also, we are keeping a close eye on our spending in every area, to stay within the budget.
Byton could become a success, considering the price and the product package. Will you be able to build enough cars? How to avoid problems like with the Tesla Model 3?
HW: You have to enforce a super-disciplined time management. You cannot allow last-minute changes – these will cause exponential, not linear production delays. We have experience in getting a totally new car production ready on time [editor’s note: with the BMW i8]. In terms of capacity, we have to make an estimate that is optimistic but realistic, together with our partners. We are flexible, both in terms of supply chain and of infrastructure. We have enough space to grow and add additional assembly lines. On top of that, we could consider contract manufacturing by an industrial partner.
What will your business model be like? Conventional or Lynk&Co inspired?
HW: We are aiming to be profitable with a classical car business. Of course, we are observing the market, and if new service and mobility options come along, we could easily adapt and integrate them. If your own core business is not profitable, however, you are less flexible. That is why we are going for a direct sales model, in which we own the customer data. Our retail partners will work as agents, so we know the customer. Even in the case of a mobility usage model, like Uber, thanks to our cloud architecture, we know who uses our cars.
How will you distribute your cars? Will you go the Tesla-way?
HW: No, we are going for a direct sales approach, but in a hybrid form. As with BMW i, the dealer acts as an agent. The showroom will have in-store CI. We are talking to serious partners that are running multi-brand stores. They will operate the business, whereas we make sure we provide the right standards. We want the customer experience to be entirely satisfactory.
How will you make sure you source materials ethically?
HW: We have people with tremendous experience in supply chain management. The VP of the supply chain department has a proven track record with Ford, Tesla and Faraday. Furthermore, we uphold strict quality standards. We position ourselves as premium and take this into account when considering the various supply options, also for the battery cells. We are quite familiar with this supply landscape, given the background of our people.
Picture copyright: Dieter Quartier