Joey Wen

The world is always changing at a rapid pace.

Last Friday, while I was still following the ending of the 3A game “Elden Ring” on PS5, there was a sudden change in the automobile industry.

On March 4th, Sony and Honda announced their strategic partnership to jointly establish a new automobile company, in response to the impact that electrification and intelligence have made on traditional companies.

As an electronics enthusiast, I have expressed my optimism and expectations for Sony’s foray into automobile manufacturing more than once. Meanwhile, as a member of the automotive industry, I understand Honda’s pivotal role in automotive history and the admiration its fans have for its engine technology.

But can such a strong collaboration give rise to the “square” of the great brands? This is obviously something that remains to be seen.

Acceleration

If Tesla’s success represents a turning point in the automotive industry, I believe no one would oppose that. With the advent of new energy (primarily pure electric) and intelligent era, automotive brands have naturally been divided into two worlds: new and old.

Initially, Tesla began this division, but later other companies also began to drive it.

As the era of pure electrification emerges, the difficulty of manufacturing vehicles begins to decrease. At the same time, people’s focus on automotive products is no longer solely on mechanical performance. The trend towards intelligence has become the most important driving force behind the next automotive era.

Moreover, the focus on the electrification and intelligence of automobiles is not limited to industry professionals and ordinary consumers who want to buy cars. More attention is also coming from the capital market. The influx of large amounts of hot money has driven more and more automakers, especially new Chinese car brands, to enter global financial markets like the US and Hong Kong for financing.

In this environment, the market value of new car companies is skyrocketing on a daily basis, causing the likes of Toyota to lose its number one spot. Similarly, brands like Rivian, which represent niche pickup trucks, are also becoming hot commodities once they enter the new energy market.

So, what about traditional manufacturers?

The pace of traditional automakers is somewhat slow, and Japanese manufacturers have undoubtedly been the slowest. For example, Toyota, which has always maintained a wait-and-see attitude, has been sticking to the strategy of developing traditional energy + hybrid + hydrogen fuel cell until 2021. Until the end of last year, Toyota truly gave up its fantasy, prepared for battle, and put the electrification of Lexus on the agenda.

Similarly, Nissan, as a major Japanese automaker, took a different approach and introduced an e-Power technology, which is a strategy similar to an extended range petrol-electric hybrid. On the basis of maintaining lower emissions, the energy consumption unit is still calculated in terms of fuel consumption. But compared to the usage anxiety that still needs to be solved for pure electric vehicles, it is actually a clever but practical solution.

So, what about Honda?

Honda’s plan is not particularly fast. Previously, Honda announced a plan to completely stop selling internal combustion engine cars by 2040; by 2030, the sales of electric vehicles (EVs) and fuel cell electric vehicles (FCVs) would reach 40%, and by 2035, it would reach 80%.

Obviously, compared to German car brands that consider 2025 as an important node and aim to achieve a huge goal by 2030 (such as Volkswagen’s plan to increase the sales share of pure electric vehicles in the Chinese and American markets to 50% and the sales share in Europe to 70% by 2030), Honda’s pace is somewhat slow.

Therefore, choosing to form a joint venture with Sony and planning to launch the first pure electric vehicle in 2025 is undoubtedly an important strategic plan. It is also an important measure to help companies accelerate their new energy strategies.

After all, if they don’t catch up, it really will be too late.

Division of Labor

The division of labor of this new joint venture between Honda and Sony is not difficult to guess. According to foreign media reports, Honda will still play its best role in car manufacturing and car marketing in the new joint venture.Sony, on the other hand, offers the latest technology which almost covers all the core technologies needed for smart energy intelligent vehicles, including visual sensors, vehicle interconnection, and vehicle entertainment. These are obviously the critical components of intelligent driving assistance and intelligent cabins in Smart Cars.

Sony has been “undercover” in the field of new energy vehicles for a long time. For instance, Tesla uses Sony’s 18650 batteries. This means that Honda would not have to rely on global battery manufacturers such as CATL or LG for the core components of pure electric vehicle power in the future. More importantly, Sony has already laid out its plan for intelligent driving assistance and intelligent cabins.

At this year’s CES exhibition, Sony has launched a package plan and a relatively mature Vision-S model. After all, for Sony, which has almost 50% of the global share in CMOS image sensors, it is a waste not to develop intelligent driving and other technologies.

CMOS is only one of Sony’s most powerful killers in the field of technology. Nvidia and Mobileye have given Sony chip access, and application of the 5G network has given Sony the ability to remotely control unmanned driving vehicles over long distances.

In terms of visual imaging and overall leadership in electronic entertainment technology (including the PS game console I mentioned earlier), Sony will greatly empower the intelligent cabin levels of future Honda + Sony new car products. I even have a bold speculation that the cooperation between these two brands will very likely break through the limitations of current intelligent cabin functions, operating logic and methods, and trigger a new round of intelligent cabin “internal competition.”

Sony’s technology empowers Honda’s vehicles, and it is undoubtedly worth expecting. But if we say it’s fresh, it’s not necessarily true. After all, we should be used to such models of cooperation between companies like Sony and Honda.

Just last week, Jidu Auto (Jidu Auto’s One Year Anniversary: Where is the Future?) which I just talked about, adopted such a model. Jidu is a new car brand that combines a typical tech company with a traditional car manufacturer. By combining Baidu’s achievements in AI and combining Geely’s million-level OEM car production power, it strives to provide users with updated intelligent experiences while maintaining the quality of car production.The mode of collaboration between Honda and Sony is not unique to Jidu. Collaborations between Alibaba DAMO Academy and IM Auto (backed by SAIC), as well as Huawei’s full-stack smart solution and Celerx, also follow this pattern. Looking back even further, when various new car brands first emerged and chose contract manufacturers to address industrial manufacturing capabilities and qualifications, this could also be considered a prototype of this collaboration model.

It can be said that Chinese new car companies have already played this type of collaboration with Honda and Sony in a clear and straightforward manner. In terms of technology, everyone should be focusing on new technologies and new techniques. Even in the development of the intelligent cockpit ecosystem, Chinese new car companies may have some leading advantages.

Of course, Sony and Honda, as Japanese manufacturers who excel in their respective fields, cannot be equated with new car companies. After all, for brands like Sony and Honda, which were established in the 1940s and have been leaders in their respective fields for more than 70 years, the reputation of the brand, the expectations of society, and the accumulated resources (supply chains, funds, and technical reserves) that can be activated behind them cannot be compared with new car brands that rise overnight.

At least, many hardware that can restrict market development, such as CMOS sensors mentioned earlier, are still in Sony’s hands. And Honda’s ability to tune cars is not something that can be surpassed overnight. Therefore, they definitely have the strength and confidence to achieve a rapid incremental effect by combining Sony’s and Honda’s respective strengths through cooperation even without addition but multiplication.

Of course, there are still surprises. For example, at the previous CES, Sony established a new company called Sony Mobility Inc., which is a new company for Sony’s mobile travel company. And the collaboration with Honda obviously goes beyond the original goal of independent research and development. However, such collaboration not only enriches the development path of Sony’s new energy intelligent cars but also brings new and more possibilities.

For example, becoming a technology company like Huawei, which not only builds cars for itself but also provides an intelligent ecosystem for more enterprises, is one of the possibilities. And once this possibility is confirmed, perhaps Sony’s development prospects in the field of new energy intelligent cars will become even broader.# You see, the world changes so fast. The future of Sony will still be anticipated.

This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.