How Cruise reduces the cost of the central control unit by 90%

Cruise is an automotive start-up that now belongs to GM. If you visit San Francisco, you can see the autonomous vehicles on the streets, which are now also completely driverless.

But what fascinates me as a systems engineer at least as much as the product: Cruise - like many others - had a supply chain problem. The company therefore decided to manufacture critical components itself, including microchips.

The result is impressive: the new C7 central control unit is 90% cheaper, 70% lighter and consumes 60% less energy compared to a unit manufactured by a supplier. Talks with Bosch, Continental and ZF came to nothing.

Acquired startup

The start-up was founded in 2013 with the aim of developing kits for retrofitting vehicles for the autonomous driving. However, the company has focused on software since 2015. The early successes led to an acquisition by General Motors (GM). Even after the acquisition, Cruise retained a lot of autonomy and initiated further investment rounds, which has led to a current valuation of $20-$30 billion. This makes Cruise a Decacorn.

After the acquisition, Cruise began developing its own vehicles. Cruise's driverless vehicles are now on the road in San Francisco. These can already be booked by passengers, but they only operate in a small part of the city and only at night, when there is little traffic. But still.

Manufacturer against its will

Cruise didn't actually want to produce its own hardware and chips. But Cruise recognizedthat the prices for chips from suppliers were too high, the parts were too large and the reliability of the technology from third-party suppliers was simply not given. The current supply chain issues have further exacerbated the problem and accelerated the process.

The history of "upgrade kits" can be found in the architecture. Cruise's robotaxis are ultimately just upgraded "normal" electric cars. Therefore, the central element of Cruse is a control unit. The current C6 device still uses chips from Nvidia. In the next generation C7 control unit four chips developed by Cruise himself installed. The same applies to the control unit itself.

Due to the comparatively low purchase volumes, this approach pays off financially for Cruise. But the main driver was the lack of innovation among suppliers. The company is therefore now developing many other components itself, such as sensors.

Cruise found that commercially available radars simply did not have the resolution they needed to operate their vehicles. As with the control unit, there is a long-term cost reduction of around 90%.

Carl Jenkins, Cruise Vice President of Hardware

Talks with German suppliers

What Carl Jenkins, Cruise's Vice President of Hardware, said about his discussions with German suppliers is worrying. His target for delivery was 2025 and he was surprised that Bosch, Continental and ZF didn't even have similar developments underway. So he asked how long a new development would take. The answer: seven years. That was not compatible with the company's schedule.

The fact that Cruise (and similar companies) would much rather work with suppliers than build everything themselves is particularly fatal for our industry. But the bottom line for Cruise is positive: the C7 control unit will be 90% cheaper, 70% lighter and consume 60% less energy.

Can Germany catch up?

Cruise can only afford to develop its own chips and sensors because the company has been financed accordingly. Just as important: Cruise does not have the history of a vehicle manufacturer, but of a software company. From this point of view, it should not be so difficult to celebrate similar successes in Germany.

In my opinion, there is a problem with the entrepreneurial mentality or the willingness of investors to take risks of this kind. I doubt that a company like Cruise could be born out of a group. After all, no matter how much distance the parent company is willing to keep, history is always involved.

Of course, that doesn't mean that companies aren't trying: Bosch has a very successful program from which, among other things Bosch e-bike has emerged. Festo also has a similar program for robotics. However, many companies do not believe in this approach. For example Cariad has close ties to the VW Group and also recruited intensively from the Group's employees.

Hesitation in startup financing

But in the start-up environment, German investors are still reluctant to commit large sums of money. Florian NöllChairman of the Federal Association of German Startups e.V, cited the investment in Automotive in the seven years from 2011 - 2018 (in the video from 15:05):

• Germany: USD 1 billion
• USA: USD 56 billion
• China: > USD 30 billion

So it's not surprising that we are falling behind.

Image: Cruise