Safety Systems, which were once exclusive features of the high-end cars, are now de rigueur in almost all vehicles sold in the Asia-Pacific region.
The furious pace of technological change and the intense competition in the automotive industry has led automakers in the Asia-Pacific market to vigorously adopt new technologies that can augment car performance and safety. For instance, safety systems such as Antilock Braking System (ABS) and airbags were exclusive features of the high-end car models in the mid-1980s when they were first adopted. But now, they are de rigueur in almost all vehicles sold in the region.
In developed economies such as Australia and Singapore, the safety systems featured in compact/mid-sized vehicles are comparable to that available in Europe and North America. For the Australian market, the superior safety systems featured in automobiles are, to a certain extent, driven by the high level of safety awareness among the local populace.
Nonetheless, with competition rising in the global automobile industry, manufacturers are constantly introducing new and increasingly sophisticated safety features into the market. For instance, cutting edge night vision technology that is typically associated with military vehicles, has now been incorporated into certain high-end cars from companies such as BMW and Mercedes Car Group.
In Singapore, this technology is now an optional feature in the BMW 7 Series and Mercedes-Benz S Class. Other state-of-the-art features such as Adaptive Cruise Control, Smart Screen Navigation Systems and Drive By Wire technology might become ubiquitous features in passenger cars in the Asean 3 region (Malaysia, Thailand and Indonesia) in the next five years.
i. Rising safety awareness in the Chinese market
In China, the passenger car active and passive safety systems market is in its growth stage. Rising customer concerns over vehicle safety is one of the factors contributing to this growth. In 2005, the installation costs for active safety systems such as Electronic Stability Control (ESC), Active Steering Systems (ASS) and Adaptive Cruise Control (ACC) were quite high. Despite this, vehicle manufacturers began to adopt more advanced active safety systems into a wider range of passenger vehicle segments to differentiate their products in this highly competitive market.
By 2005, a number of Chinese vehicle manufacturers began adopting ABS. The ESC system was only adopted by some multinational vehicle manufacturers such as BMW, Toyota, Volkswagen and General Motors (Table 1).
Relatively sophisticated systems such as ASS and ACC were fitted only in BMW car models. Tyre pressure monitoring system (TPMS) featured only in the GM Buick and Toyota Crown in 2005.
In the case of driver airbags, they have 100 percent penetration rate in most vehicles, especially those manufactured by the multinationals. However, the installation rate of front passenger airbags is not as high as driver airbags. Additional features such as curtain airbags were mainly introduced by the multinational vehicle manufacturers such as BMW, Toyota, Volkswagen (in its Audi vehicles), Nissan, PSA and General Motors. Basic safety features such as seatbelts are prevalent across all car models.
The luxury makes tend to possess all the essential safety features mentioned above. For instance, in 2005, BMW had 100 percent installation rate in all airbags and seatbelt systems, including side and curtain airbags (Table 2).
Given the intense competition in the Chinese passenger car market, vehicle manufacturers often have to devise cost-efficient product solutions to transfer the relative benefits of safety systems into passenger car sales. They are also constantly exerting pressure on their suppliers to provide inexpensive yet relatively high quality products, to maintain their profit margins.
Thus, active safety systems manufacturers in China often face the challenge of offsetting the pricing pressure from vehicle manufacturers, in order to compete against a handful of safety systems suppliers that constitute the market.
ii.Singpore: Regional test bed for high tech safety systems
In smaller but more developed markets such as Singapore, the level of safety systems in passenger cars is generally of a higher standard. Safety features such as ABS and airbags (front) are standard features across all Honda, Nissan, Toyota, Mitsubishi, Hyundai and Mazda models.
The ubiquitous Toyota models (e.g. Corolla Altis, Vios and Camry) and Mazda models (e.g. 3SP and 6SP) come fully equipped with additional features such as the Brake Pedal Intrusion Prevention Systems (the brake pedal folds instead of jutting forward in the event of a collision) and the Collapsible Steering Column. The Mazda models have even achieved the European New Car Assessment Program (NCAP) 5-Star rating for safety, the highest possible safety rating in Europe. In the Singapore market, Front Pretensioner Seatbelts too have become standard features in mid-sized saloons such as the Honda Civic and Nissan Sylphy etc.
With rising customer expectations and increasing competition, highly sophisticated features such as Brake Assist and Electronic Brake Force Distribution (EBD) are also becoming increasingly prevalent in such car models. Another nifty safety system typically found in mid-sized cars in Singapore includes the Supplemental Restraint System (SRS) airbags that help prevent head and torso injury by deploying during frontal collisions.
Some mid-sized cars like the Honda Civic have taken the humble airbag to a whole new level. The Honda Civic, sold in the Singapore market, has front-row side airbags that feature an Occupant Position Detection System (OPDS) that determines the height and position of occupants and adjusts the airbags accordingly.
Many mid-sized cars also come with active head restraints that mitigate neck injuries during a collision by absorbing the impact when an occupant’s head is thrown back. The intensifying competition among car manufacturers has driven many of these advanced safety systems into the mainstream.
Some of the larger sedans such as the Toyota Camry 2.4 usually come fully equipped with a plethora of safety features such as EBD, ESC, side impact beams, curtain airbags, the brake pedal intrusion prevention system, the collapsible steering column, traction control and whiplash protection.
Currently, the ESC control is also fast becoming a standard feature in the larger (above two liters) Honda (e.g. Accord), Toyota (e.g. Camry) and Hyundai (e.g. Sonata) models. It is only a matter of time before this feature is incorporated in the smaller mid-sized sedans. The value of the ESC system is underscored by the fact that it is recommended by Euro NCAP in ensuring a vehicle’s primary safety (minimising the risk of being in an accident).
In Singapore, Honda has also rolled out models such as the Honda Accord 2.4 which come equipped with cutting edge safety systems such as Drive By Wire.
The idea of the Drive By Wire system is to remove the mechanical linkages between the controls of a car and the devices that actually do the work. Thus, instead of operating the steering and brakes directly, the controls would send commands to a central computer, which would instruct the car on the right course of action.
The advantage of this system is that the computer is able to make the steering, suspension and brakes work together to give the car better handling particularly in adverse road conditions?to give better fuel consumption, and to react to emergencies faster than a human driver could. In Nissan’s case, its Cefiro comes equipped with a sophisticated Smart Screen Navigation System. This system has an LCD screen which incorporates an in-car touch screen GPS Navigation System (with full navigation capability in co-ordination with both on-screen and voice guidance) and a reverse camera to display images of vehicle rear for safer reverse parking.
In view of the plethora of high tech features available in Singapore cars, it is evident that most automotive OEMs are using the country as a test bed for their latest models before rolling them out to the region.
iii. Recent developments in the ASEAN 3 region
With rising economic prosperity in the Asean 3 countries of Thailand, Malaysia and Indonesia, the passenger cars introduced in the region typically have safety features such as ABS. In Malaysia, locally manufactured models such as the Proton 1.6liter Gen2 and the Proton 1.2liter Savvy also come equipped with enhanced ABS.
In the pick-up dominated Thai automotive market, there seems to be an increasing emphasis on safety systems. For instance, the All New Ford Ranger has set new safety standards in the pick-up truck industry through its industry-first seat side airbag. It comes equipped with standard front driver and passenger airbags. This new pick-up also has three-point seatbelts in outboard positions which come with seatbelt pretensioners.
Further, the Ford Ranger’s superior body construction is designed to manage the crash forces away from vehicle occupants. The New Ford Ranger has additional features such as side intrusion beam (for side impact protection) and a raised door beltline (for added safety and protection). The introduction of this vehicle is viewed as a significant breakthrough in the Thai pick-up market, which tends to place relatively less emphasis on safety features.
All these recent developments are attributable to the region’s rising economic affluence. The increasing GDP per capita in this region allows car manufacturers to pass on the cost of advanced technology to customers.
iv. The sophisticated Australian market
The Australian automotive market has four vehicle manufacturers Holden, Ford, Toyota and Mitsubishi. As the local populace possesses a high level of awareness of vehicular safety, most vehicles offer superior safety features.
ABS systems are standard features on most vehicles manufactured in Australia. In the case of ESP (Electronic Stability Programs) systems, they are increasingly gaining ground and are expected to be offered on most premium segment vehicles. Such features are expected to become an integral part of mid segment and compact cars in the near future.
By the end of this decade, ESP systems are expected to be as ubiquitous as ABS systems. Advanced safety devices such as ACC are anticipated to be launched in Australia by 2009-2010.
Given the sheer competitiveness of the global automobile industry, manufacturers are constantly rolling out state-of-the-art technologies to differentiate themselves from their competitors. For instance, thermal imaging equipment (night vision), commonly associated with military vehicles, has now been incorporated into certain high-end cars from companies such as BMW and the Mercedes Car Group.
In Singapore, BMW 7 Series owners can opt to have the night vision system. As it has a range of 300 meters, BMW asserts that it significantly enhances safety at night. The Mercedes Benz S Class also has a similar feature known as Night View Assist. Within the next five years, this high tech safety feature might actually become a ubiquitous feature in all mid-sized passenger sedans. Features such as ABS and airbags were once the preserve of prestigious saloons.
Other advanced features such as ACC, Smart Screen Navigation System and Drive By Wire, along with the myriad of sophisticated sensors utilised in such systems, are also likely to become commonplace in the automobiles sold in the ASEAN 3 region (Malaysia, Thailand and Indonesia) by around 2010-2012.
Currently, in almost all developed markets, vehicle manufacturers are legally required to incorporate advanced sensors such as tyre pressure sensors into their vehicles. However, in most Asian markets, only manifold air pressure sensors are widely used.
In the Asia-Pacific region, tyre pressure sensors are largely limited to high-end imported vehicles due to the high cost and the absence of legal mandates. For instance, in 2005, General Motors was among the first foreign manufacturers in China to introduce an indirect TPMS through its Buick model. The indirect TPMS refers to a system in which tyre monitoring is linked to the vehicle’s ABS, by comparing the rotational speed of the wheels. Conversely, the direct TPMS utilises sensors that are placed at each wheel to measure the pressure in each tyre at regular intervals and transmit the radio frequency signal to a central control unit in the vehicle. The central control unit then analyses the information and displays it to the driver.
In 2005, only 12,800 units of TPMS were installed in the passenger cars produced in China and these were largely installed in the Buick models. However, the demand for TPMS is expected to increase mainly due to the growing consumer awareness of safety features and the adoption of these systems by vehicle manufacturers in new car models. This trend is boosted by the robustness of China’s burgeoning automotive market. Frost & Sullivan estimates the number of TPMS used in Chinese passenger cars to reach 605,000 units by 2012.
Across the Asia-Pacific region, this safety feature might make it to the mainstream by the turn of the decade.
In China, side and curtain airbags have been mainly installed in the high-end luxury executive car segments since 2005. However, vehicle manufacturers are expected to increase the adoption of these airbags across more vehicle segments. Frost & Sullivan expects the demand for these airbags to increase rapidly during the 2006-2012 period. Further, airbag sensors might become more commonplace in the Asian market in the future.
Load limiters and pretensioners are future trends in the seatbelt market in China. Further, automatic locking retractor (ALR) seatbelts are likely to be introduced in the Chinese market by 2012. Cutting edge features such as electrical seatbelt drives, variable seatbelt tighteners, new belt materials and inflatable seatbelts are also expected to be introduced in the future.
The major restraint that impacts the Asia-Pacific passenger car safety systems market (particularly in China) is the relatively low consumer awareness about the benefits of automotive safety features. It is advisable for safety systems suppliers to design marketing programs to promote their products and more importantly, to educate customers about the technical and safety features of new technologies. Further, safety system suppliers should collaborate with vehicle manufacturers in promoting new advanced features in automotive safety systems.
The creation of strong domestic players would also bolster the Asia-Pacific passenger car safety systems market. In China, the multinationals dominate both the active and passive safety systems market. Most multinational suppliers in China have invested heavily in R&D while domestic Chinese suppliers are just entering the market.
For instance, Bosch opened the Bosch Engineering Center (Suzhou) Co. Ltd. in April 2005 which develops vehicle safety systems such as ABS, ESP and brake systems in China. Its key competitor, Delphi China, in June 2005, completed the first phase of a US$ 50 million research and development center that would be one of the top five Delphi technical centers globally when completed in 2009.
Given the sheer size of their multinational competitors, domestic suppliers are recommended to invest in R&D or alternatively to license technology (which might be a more viable strategy). It is also highly advisable for domestic companies to cultivate strong research ties with international sensor suppliers to secure access to cutting edge industry knowledge and production know-how.
