Young Car Brands Like Tesla, Lucid More Tolerant To Buggy New Tech: ZF

The German automotive supplier’s CEO says newcomers have different expectations of speed.

2023 Nio EL6 interior cockpit

Iulian Dnistran

By: Iulian Dnistran

Jul 26, 2023 at 7:07am ET

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Young car brands like Tesla, Lucid, Nio, and Xpeng want the newest technology as quickly as possible, even if it doesn’t work as reliably as intended, ZF CEO Holger Klein said for Automotive News Europe during a recent roundtable discussion at the automotive supplier’s headquarters in Germany.

"If your latest innovation feature doesn't work as reliably as you would expect from a German premium brand, it's somehow OK," said Klein. "This happens when the customer wants a particular car and a particular function and is willing to accept some deficiencies."

ZF is the third largest automotive supplier in the world, with an estimated revenue of $42.1 billion last year, according to Automotive News, best known for its eight-speed automatic transmission models used on internal combustion engine vehicles made by several brands including BMW, Audi, Alfa Romeo, Jeep, Volkswagen, Dodge, and Rolls-Royce.

However, the Friedrichshafen-based company develops and manufactures everything from airbags and seatbelts to advanced driver assistance systems and electric drivetrains.

Speaking about these young car companies that are pushing it to deliver more tech faster compared to traditional German automakers, ZF’s CEO said:

“They have a different expectation on speed. Speed is king.”

With this being said, Klein is adamant that this sense of urgency doesn’t mean that the supplier is willing to compromise on its proven development processes or skip quality steps. Instead, it just means that newcomers will be more tolerant of bugs that haven’t been eliminated in development.

“I think that makes many of them faster,” ZF’s head honcho said. “It is demanding to keep pace with this speed.”

Gallery: 2023 XPeng G6

2023 XPeng G6 exterior

The effects of this approach can be seen throughout the global automotive industry, with age-old names having a hard time catching up to newcomers in terms of sales, starting with the United States and continuing with China and Europe. Almost every new sales report that comes in the news cycle shows plug-in-only newcomers beating traditional automakers at their own game.

This is partly due to the ongoing EV price war that was started by Tesla and has seen new car prices go down by 20 percent in the last year, but there’s also the perception that emerging automakers are approaching their customers differently, as ZF’s CEO says.

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"Sometimes we are perhaps a little bit too much in our boxes," he said. "For me, this is the beauty of software-defined cars, because people come in with different ideas."

As always, we’d like to know what you think about this, so head over to the comments section below to give us your thoughts.