FRANKFURT (June 22, 2010)—Continental A.G. predicts a dramatic increase in the adoption rate of high-tech safety features by volume manufacturers in three to five years.
Continental executives said the maker of tires, powertrain, chassis and interior systems has agreements on more than 50 projects with American, Japanese and South Korean auto makers that will lead to the installation of high-tech equipment such as cameras, crash avoidance and blind-spot detection.
Conti predicts that within five years, 50 percent of cars priced less than $35,000 will be equipped with one or more of those features. The current take rate on those technologies is 10 percent, executives from the firm said.
Historically, the adoption rate on high-end technology has been limited to premium vehicles because of the high cost of development and installation. But dramatically increased volumes have become the catalyst for lower pricing.
“We will be moving from premium to affordable with safety technology,” Ralf Cramer, the Conti board member responsible for chassis and safety, said at an event here last week. “There are huge opportunities for growth in small-sized vehicles. Our task is to reduce the add-on price to a minimum and bring advanced safety features down to an affordable level.”
In North America, Conti is expanding its business rapidly with the Detroit 3 as well as Japanese and South Korean auto makers selling in the U.S.
The German supplier said Detroit auto makers are spending heavily on advanced technology to differentiate themselves from competitors. That technology is set to roll out by 2013.
“After bankruptcy we have seen an increased interest in technology for pure differentiation,” said Samir Salman, CEO of Conti's NAFTA region. “After going through bankruptcy, they know they need to differentiate themselves if they want to be around in five, 10 or 15 years.”
Andreas Brand, Conti 's executive vice president for passive safety and advanced driver assistance systems, said the No. 1 option that American auto makers are requesting is blind-spot detection. Forward-collision warning also is high on auto makers' wish lists.
American companies have started planning the installation of lane departure systems on vehicles priced less than $35,000. In some cases, the auto makers are requesting a range of traditionally high-tech safety packages on next-generation vehicles.