Honda-Sony tie-up Why they’ll make cars together

$125.24bn

Current market capitalisation of Sony (11 March 2022)

Why Honda-Sony deal matters

CreationofjointEVbrandshowshowcarmakersandtechgiantscanjoinforces

Honda has dreamed the impossible dream and agreed to do something established car makers have resisted for years: be a contract manufacturer.

The agreement between Honda and Sony to jointly create a new EV brand “aligns the technological assets of both companies” , according to Honda, as they work to launch their first car in 2025.

In doing so, the Japanese pair have made a bold move to marry the skills of a technology giant with the engineering and manufacturing know-how of a vehicle company.

The combination is one that is being investigated globally as cars become more defined by software than hardware. Most notably, it’s happening in China.

Examples include Geely’s link-up with tech giant Baidu to create the Jidu brand for selfdriving EVs, with Geely taking the lead on engineering and manufacturing aspects.

Stellantis’s partnership with Apple iPhone maker Foxconn to develop digital cockpits and connected services through the new Mobile Drive division is another good example, said Jonathan Davenport, an analyst at consultancy Gartner.

“There’s this coming together of automotive and consumer electronics and software that consumer electronics brands think they can leverage, ” he explained.

Sony announced its interest in cars at the 2020 Consumer Electronics Show in Las Vegas when it revealed the Vision-S 01 electric saloon. It was that rare thing in automotive: a genuine surprise. It wasn’t so much the smoothly generic design that wowed showgoers but the completeness of the concept.

Sony tried to deflect by saying the car was primarily a showcase of some of its tech, such as cameras, but it was clear the interest was there.

Sony then returned to CES this year with the Vision-S O2 SUV, before Honda and Sony madetheirjointannouncement in early March “to establish a joint venture to engage in the joint development and sales of high value-added battery-electric vehicles and commercialise them in conjunction with providing mobility services” .

Sony’s entry into the new software-defined automotive era makes sense. It may not have much of a share in the smartphone market, but its experience selling PlayStation video game consoles will provide useful carry-over, with shared hardware elements like chipsets and digital services such as downloads and over-the-air upgrades.

Sony will develop a “mobility platform” for the new EV brand that it is creating with Honda.

The company actually makes PlayStations itself, rather than outsourcing, but designing and building cars is several orders of magnitude harder.

“A vehicle with all the associated functional safety and ADAS requirements is complex to create but especially to create at scale, ” said Davenport. Tesla is often held up as an example of the first mover responsible for many new car industry trends, and it definitely has been a leader on the software side. But for tech firms and other automotive newcomers, it has also been a clear example of how not to get in the business.

“[Tesla boss] Elon Musk didn’t think he would need to partner with the Fords of this planet with their supply-chain experience, ” said Neil Endley, a director at quality consultancy Trigo. “He said ‘I’ll go do that myself’ and then suffered like hell with lack of product to the plants. ”

Tesla’s slow and agonising production ramp-up is one big mistake made by automotive newbies. Underestimating the cost of engineering is another –one that Dyson suffered just before it abruptly shut down its electric SUV project in 2019.

157.7m PlayStation 2s sold, the most successful console ever

Sony showed saloon concept in 2020, followed by SUV Honda already sells EVs under its own banner

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Founder Sir James Dyson said to sell the car at a profit, he would have had to charge more than £150,000.

Dyson’s costs spiralled in part because it focused on redesigning areas that didn’t really need it – in particular, a new heating and ventilation system and improved seats.

“Who does that?” a senior automotive executive said on condition of anonymity. “No wonder costs got out of hand. ”

Car makers and suppliers have already mastered this kind of engineering. Where they are struggling to catch up is in software, which is why the Honda-Sony partnership makes such good sense.

Their new EV brand will pool talent from both sides to design and develop cars, while Honda “is expected to be responsibleformanufacturing” .

This is a big deal. Car makers have long feared relegation to the status of white-label supplier in the era of mobility. Without the car brand’s power to boost pricing, engineering and manufacturing become thin-margin exercises.

The reason Apple has yet to announce its ‘Project Titan’ EV, believe analysts, is because it hasn’t found a car maker

with enough scale prepared Honda’s decline in annual to become an Apple supplier. car sales in Europe from After Hyundai confirmed in 2006 to 2021 2020 that it was in talks to build an autonomous EV for Apple, it was reported by local media just two months later that the Korean company had backed out for fear of becoming a mere contract manufacturer. Honda’s partnership with Sony, however, is more equal, with both sharing in the success of the new brand. This, of course, creates the problem of what to name it. Both Honda and Sony would carry weight, but using either could be seen to elevate the status of that company over the other. A new name, on the other hand, would have zero customer recognition. That is probably the least of their worries. The important takeaway is that the project represents a win for Sony and a significant shift in thinking for Honda. Its star has fallen in Europe, with car sales dropping from 313,000 in 2007 to just 68,346 last year, according to the European Automobile Manufacturers’ Association. The Sony partnership could be the perfect next quest to, as the song goes, reach for the unreachable star. NICK GIBBS

W H A T W I L L T H E F I R S T H O N D A - S O N Y C A R L O O K L I K E ?

The 2025 launch of the first Sonda (or should that be Hony?) is a long way off, but we have early clues as to how the car will look.

The exteriors of Sony’s Vision-S 01 saloon and Vision-S 02 SUV concepts are svelte, aerodynamic and unmemorable. The interior of the 02, with three screens stretching the width of the dashboard, is probably more central to its appeal, being a grown-up version of what’s seen today in the Honda E.

Honda and Sony have said their first car will “be centred around safety, entertainment and adaptability” , all of which point to self-driving ability.

Honda is working on a new EV platform,e:Architecture, to arrive in the second half of this decade, which could be made to fit the timescale, but it has also teased five e:Nbadged EVs for China, based on a stretched E platform.

The first two e:N cars are conventional electric versions of ICE cars, but the bolder styling of the e:N SUV, e:N GT and e:N Coupé concepts could point to a less conventional look.

How England’s roads will be made net-zero

NATIONAL HIGHWAYS IS focusing on the environment more than ever before with the creation of an environmental division under sustainability director Stephen Elderkin.

BALANCING ACT Elderkin believes England’s roads must sit within a wider environmental framework.

“There’s no question that roads are part of the future of the UK’s transport system and will continue to cater for the vast majority of passenger miles and freight movements, ” he told Autocar. “But what’s really critical is that we’re able to meet that demand in a sustainable way.

“One of the things that will be a measure of success will be National Highways seeing the environment as an integral part of our deliverables.

“There has always been an importance placed on the environment, and I don’t want to discredit the work that has been carried out historically, but I think this is a step on and up in terms of the resourcing and priority going forward. ”

The creation of the division comes after National Highways (which receives five-yearly funding settlements from the UK government) last summer released a report outlining a strategy to cut emissions.

It plans to make its operational emissions (from lighting, signage and its vehicle fleet) net-zero by 2030, road construction and maintenance net-zero by 2040 and road-user emissions net-zero by 2050.

MAINTENANCE ESSENTIAL Even if new road building is curtailed, Elderkin believes maintenance of the network will remain essential.

“If you’ve sunk a lot of carbon, energy and cost into creating a network, you’re going to want to operate and maintain it, so you still have the same challenges to overcome in terms of construction and maintenance, ” he said.

BIGGER HURDLES TO COME Elderkin believes eliminating emissions from construction and maintenance of roads by 2040 is going to be the biggest challenge to overcome.

He explained: “We use a lot of materials that need to be not only transported but also mined. Quite a lot of them are energy-intensive and some of them release CO2 as part of the chemical[production]process. ”

Surely the easiest approach – and one that’s being taken by Wales – is to not build any more roads in the future? Elderkin said his team is going to take a more nuanced approach.

“We will implement a carbonmanagement framework under the standard for managing carbon, ” he explained. “It has a reduction hierarchy. This includes ways we can deliver the value from infrastructure while building less. ”

Elderkin believes greater use of tech can negate the need to add extra lanes in some cases.

“We have ambitious plans for digital roads, ” he said. “If they can increase capacity without building road surface, it would be a win-win. ” DANIEL PUDDICOMBE

2030 When National Highways plans for its operational emissions to be net-zero