New Opportunities Abound for Vietnamese Companies in the Auto Industry

For software companies like FPT Automotive, the increasing desire of manufacturers to control both hardware and software presents numerous new opportunities.

A simulator-based driving test by FPT engineers. Photo: VA.

In the booming era of electric vehicles, where most systems are equipped with connectivity and smart functions, some liken a car to a computer or smartphone on four wheels.

Nguyen Duc Kinh, CEO of FPT Automotive, who has extensive experience in automotive software projects at FPT, stated that the majority of the company’s revenue continues to come from vehicle connectivity systems. He emphasized that it would be a mistake to view modern cars merely as "phones on four wheels," as they are complex systems that must meet stringent safety standards.

Originating from a background in software, FPT Automotive was established in the US by FPT Software at the end of 2023. Mr. Kinh affirmed that FPT does not "produce an entire car," instead, FPT engineers focus on core technologies within the automotive industry.

"FPT Automotive engineers have moved beyond traditional IT tasks. They now apply extensive scientific knowledge to develop systems and control components in vehicles, truly embodying the essence of 'engineering,'" Mr. Kinh shared in a recent press meeting.

Three layers of the vehicle ecosystem

FPT Automotive, a new venture established by FPT in the US at the end of 2023, serves a diverse clientele across the automotive industry. According to Mr. Kinh, the company's customers span all three "layers" of the industry ecosystem: vehicle manufacturers (OEMs), Tier-1 suppliers, and chip makers.

OEMs (Original Equipment Manufacturers) represent the highest tier and are responsible for vehicle production, including companies like Toyota, Honda, and BMW. Suppliers, such as Bosch (Germany), Magna (Canada), and Denso (Japan), manufacture components and supply them directly to OEMs. Chip makers, including NVIDIA, Qualcomm, and NXP, provide essential chips for vehicle systems.

Mr. Nguyen Duc Kinh, CEO of FPT Automotive, discussed the three-layer model of the car manufacturing industry. Photo: TA.

Companies need software solutions regardless of their industry level. According to Mr. Kinh, FPT Automotive positions itself as a technology partner, offering software solutions and some specialized hardware services.

FPT representatives summarize the critical trends in the automotive sector with the acronym CASE, which stands for Connected, Autonomous Driving, Software-Defined Vehicles, and EV (electric vehicles).

FPT Automotive's current revenue primarily comes from developing in-vehicle connectivity and entertainment systems. However, Mr. Kinh also noted that the company is actively investing to expand its focus on other trends, such as autonomous driving vehicles.

In addition, FPT Automotive excels in AUTOSAR, a standard for controlling car components that ensures broad compatibility.

Mr. Kinh highlighted that with a team of 1,000 engineers specializing in AUTOSAR, the company is well-positioned with core technology, enabling it to confidently advance its development in the future.

Opportunity to become "Tier-1"

During the sharing session, the representative from FPT Automotive noted that the company's revenue predominantly comes from contracts with Tier-1 suppliers, while the proportion of revenue from OEMs remains lower.

Mr. Kinh commented on the evolving global automotive market, where OEMs increasingly seek greater control over hardware and software to accelerate time-to-market and boost profitability.

This shift presents an opportunity for software companies like FPT Automotive. Instead of solely supplying software to Tier-1 partners, FPT Automotive aims to directly collaborate with OEMs and become a Tier-1 partner.

The FPT Automotive representative emphasized that automotive software engineers need more than just software expertise; they must also have a solid foundation in basic sciences and stay continuously updated with the latest advancements. Photo: TA.

The head of FPT Automotive believes that investing in human resources, particularly those with extensive experience, is crucial for the company's development. When the company was established, it had over 4,000 employees. Currently, the workforce has grown to 4,500 and is expected to reach 5,000 by the end of the year.

Among these employees are many with 15-20 years of experience in the automotive industry, primarily from supply companies. Additionally, the company runs programs to transition traditional IT engineers into automotive software engineers through intensive training.

"Young people aspiring to enter the automotive industry should ensure that AI enhances their roles. They should focus on building a strong foundation in basic sciences like mathematics and physics and developing logical thinking skills. In the era of rapid AI advancement, having a solid scientific background and staying updated with new developments will ensure that AI serves you rather than replacing your job," Mr. Kinh shared when discussing the learning approach in the context of AI's growing influence.

Source: https://znews.vn/nhieu-co-hoi-moi-cho-cong-ty-viet-nam-trong-nganh-oto-post1487969.html