Reengineering for E-Mobility: What Combustion Component Suppliers Need to Know

Originally published by Interempresas, this expert interview is now featured on AVL.com to bring valuable industry insights to a broader international audience. In this conversation, Matthias Fail, a seasoned expert in automotive manufacturing and innovation, shares his perspective on one of the most pressing challenges facing the industry today: the transition from traditional combustion engine components to those required for electric mobility.

As the automotive industry accelerates toward electrification, manufacturers of combustion vehicle components are confronted with a complex set of technical, operational, and strategic decisions. This interview delves into the critical considerations these companies must address—from adapting production processes and materials to meeting new performance and regulatory standards. Matthias Fail outlines the key steps and innovations necessary for a successful transformation, offering a roadmap for suppliers aiming to stay competitive in the evolving landscape of e-mobility.

You can read the original interview in Spanish on Interempresas here.

First of all, how do you rate the current transition towards electric and hydrogen engines?

The transition towards electric and hydrogen engines is progressing steadily. Electric vehicles - both BEVs (Battery Electric Vehicles) and PHEVs (Plugged Hybrid Electric Vehicles) - currently dominate the passenger car market, driven by expanding infrastructure, government subsidies, significant technological advancements, and lower costs for electricity in comparison with hydrogen, especially green hydrogen.

On the other hand, hydrogen fuel cell vehicles (FCVs) are gaining relevance in heavy-duty transportation and industrial applications. Hydrogen's high energy density and rapid refueling capabilities make it an ideal solution for sectors where electrification is more challenging, such as long-haul trucking, shipping, and aviation.
Additionally, hydrogen combustion engines are an emerging technology with potential, though still in an early phase and niche compared to BEVs and FCVs.

In this transition, what would be the main challenges facing manufacturers of engine parts, for example? What are the differences between parts for combustion engines, for electric engines and for hydrogen engines?

Manufacturers of engine parts are facing several significant challenges as the industry transitions towards electric and hydrogen technologies. One of the primary challenges is retooling factories to accommodate new production processes. This shift also requires a change in skill sets, moving from traditional mechanical expertise to electrical and software proficiency. Upskilling workers to handle these new technologies is essential to ensure a smooth transition and maintain productivity.

Another major challenge is the high cost of research and development (R&D) for new technologies. Developing advanced components for electric and hydrogen engines requires substantial investment in innovation and testing. These costs can be a barrier for manufacturers, especially smaller companies, as they strive to keep up with technological advancements.

Additionally, the supply chain for electric and hydrogen technologies is very different from that of traditional internal combustion engines (ICE). Manufacturers must deal with new procurement requirements and establish reliable supply chains for the new materials and components. Furthermore, competition from new entrants specializing in Electric Vehicles (EV) and hydrogen technologies, including new players which they don’t have business now, adds pressure on established manufacturers to innovate and adapt quickly to maintain their market position.

In your opinion, which traditional components will disappear with the arrival of electric and hydrogen engines?

As the automotive industry transitions towards electric and hydrogen engines, several traditional components will become obsolete in passenger cars fully electric. Components such as fuel injectors, pistons, timing belts, fuel pumps, crankshafts, camshafts, exhaust systems, and transmissions will no longer be necessary in electric and hydrogen-powered vehicles. These parts are integral to ICE, which are being phased out in favor of more sustainable alternatives.

However, internal combustion engines vehicles (ICEV), both traditional and hydrogen, will still utilize these components, as they operate on similar principles, meanwhile EVs and hydrogen FCVs operate on fundamentally different principles. EVs rely on electric motors and battery systems, eliminating the need for many mechanical components found in traditional engines. Similarly, FCVs use hydrogen fuel cells to generate electricity, which powers electric motors, bypassing the need for conventional engine parts.

Which materials and technologies will future suppliers have to work with? And how will these changes affect the production processes and supply of materials?

As the automotive industry continues to evolve, future suppliers will need to be proficient in a range of advanced materials to meet the demands of next-generation vehicles. Key materials include lithium, cobalt, and nickel for high-performance batteries, rare earth metals for efficient electric motors, copper for wiring, platinum for fuel cell catalysts, carbon fiber for hydrogen tanks, and advanced polymers for membranes.

In terms of technologies, suppliers will need to focus on developing and manufacturing battery cells and modules, battery management systems, and fuel cell stacks. Additionally, they must master power electronics, laser welding, plasma cleaning, and 2k thermal adhesives. Ensuring all electronic systems meet stringent electrical testing and Electromagnetic Compatibility (EMC) guidelines is also critical.

The shift in production processes from traditional casting and forging for ICE to electrochemical assembly for batteries and clean-room production for fuel cells will be significant. Automation will rise to handle the delicate components involved in these new technologies. On the supply side, the need of rare earth and battery metals will strain geopolitics, with China currently dominating these markets. Additionally, hydrogen production will require scaling up green energy sources to be cost-effective, pushing the demand for renewables.

In order to adapt to future production, what investments will parts manufacturers have to make? What impact will this transition have on the supply chain?

To stay competitive in the evolving automotive industry, parts manufacturers will need to make significant investments in several key areas. Firstly, new machinery will be essential for battery module assembly, fuel cell stacking, and high-pressure tank production. These advanced manufacturing processes require specialized equipment to ensure precision and efficiency.

Additionally, manufacturers must continuously develop new components and work on creating lighter and more efficient solutions. The high level of competition in the industry means that innovation is crucial for staying ahead. This involves not only improving existing technologies but also exploring new materials and methods to enhance vehicle performance and sustainability.

Finally, upskilling engineers and operators will be crucial. As the industry shifts towards electronics and software, there will be a growing need for expertise in these areas over traditional mechanical skills.

Will new certifications or regulations be necessary to manufacture parts for these new engines?

As the automotive industry advances, new certifications and regulations will be essential to ensure safety and performance. EVs require battery safety certifications such as UN 38.3 for transport and IEC 62660 for performance. Hydrogen vehicle components must adhere to strict pressure vessel standards like ISO 19881. Additionally, emissions regulations are shifting focus from tailpipe emissions to brake emissions, reflecting the industry's commitment to reducing overall environmental impact.

Production processes are also significantly impacted by the EU's Battery Regulation. Starting in 2027, this regulation requires a battery passport for EVs and industrial batteries under 2 kWh on the EU market. This digital tool, accessible via a QR code, will document the entire life cycle of the battery, including material sourcing, manufacturing details (such as carbon footprint and energy consumption), performance metrics, safety standards, and recycling instructions. Manufacturers will input the initial data, while operators will update it throughout the battery's life. This initiative aims to enhance transparency and promote sustainability within the industry.

In this sense, how do environmental regulations affect the manufacture of parts for electric and hydrogen engines? What role do the criteria of circular economy and recycling play in these components?

Environmental regulations are significantly impacting the manufacture of automotive parts. Stricter emissions standards, such as those outlined in the EU's Green Deal and the U.S. Inflation Reduction Act (IRA), are pushing manufacturers to adopt cleaner technologies. These regulations particularly affect energy-intensive processes like steel forging more than assembly processes, driving the industry towards more sustainable practices.

Moreover, the concept of a circular economy is becoming essential. This approach emphasizes the recyclability and reuse of materials, ensuring that products are designed for durability and minimal waste.

What advantages can manufacturers who adapt quickly obtain?

Manufacturers who adapt quickly to the evolving automotive landscape can gain several significant advantages. Early movers could lock in partnerships with major industry players, securing valuable market share and establishing themselves as leaders in the field.

Additionally, engaging in green activities and adopting sustainable practices can attract investors who are increasingly focused on environmental responsibility. Furthermore, mastering new processes before competitors can significantly improve a company's positioning.

And what innovations can make a difference in this sector in the coming years?

Several innovations have the potential to significantly impact the automotive sector. Solid-state batteries, for instance, offer higher energy density and improved safety compared to traditional lithium-ion batteries. These advancements can lead to longer driving ranges and enhanced safety for EVs.

Fast-charging technologies for BEVs are another crucial innovation. These technologies enable quicker charging times, making EVs more convenient for users leading to wider adoption. Lastly, the production of green hydrogen through electrolysis can make hydrogen fuel more accessible and cost-effective.

Which countries do you foresee will have the largest number of parts suppliers for this type of vehicle?

The countries expected to have the largest number of parts suppliers in the automotive industry are China, Japan, South Korea, and India. China dominates battery production and is investing heavily in green energy. This makes it a key player in the supply chain for EVs, with a significant focus on lithium-ion battery technology.

Japan and South Korea are pioneers in hydrogen fuel cells and battery technology. Companies in these countries are leading the development of hydrogen-powered vehicles and advanced battery systems, positioning them as major suppliers in the global market.

India is also emerging as a significant player in BEV manufacturing due to its cost advantages. The country's competitive manufacturing costs and growing focus on EV production make it an attractive destination for parts suppliers looking to serve the expanding BEV market.

Finally, it has been known for some time that electric and hydrogen engines will coexist for some time. What is your opinion on this? Do you foresee the predominance of any of these technologies in the short term?

Yes, electric and hydrogen engines will coexist in the automotive industry. BEVs are likely to dominate the passenger vehicle market due to their availability across various segments and the existing infrastructure supporting them. They offer a practical solution for everyday transportation needs and are increasingly popular among consumers.

On the other hand, hydrogen will play a crucial role in sectors where electrification is challenging. This includes long-haul trucking, shipping, and aviation, where the energy density and refueling speed of hydrogen make it a more viable option. Hydrogen-powered vehicles can provide the necessary range and efficiency for these demanding applications, complementing the use of BEVs in the passenger vehicle market.