Unique among auto-producing countries that are not in a fully developed region such as North America or Europe, Korea possesses world-class levels of proprietary technology in vehicle development and production, giving it the potential to grow into a fully developed automobile producing country the equal of any other. In realizing this potential, the development in quality and scope of Korea¡¯s auto makers and vendors is critical, especially in efforts to garner necessary technical personnel know-how in independent model development. In this context, V-ENS(Vehicle Engineering aNd Solution) is playing a vital role in the development of the Korean automobile industry in its work in the automated vehicle model development sector.
V-ENS Background and Business Situation
In January 2004, V-ENS spun-off from LG CNS with the goal of strengthening the professionalization and competitiveness of the Korean automobile industry. V-ENS is the culmination of LG CNS¡¯s many years of accumulated know-how in product development and production engineering gathered in the auto industry.
Automobile product development encompasses all of the integrated development tasks that are needed in a long-term complete vehicle product development strategy including from platform engineering to styling, CAE, design engineering, and T&D. In the outsourcing situation for automobile manufacturers in emerging market, the systematic development capability is relatively weak and it urges them to outsource the development work with turnkey basis. Despite the internal technological capacity of auto manufacturing companies in advanced economies, they outsource development capacity in response to shifts in the economy.
The production engineering sector can be divided into process engineering, factory construction, and machinery & equipment. It ranges from comprehensive design and testing of actual manufacturing plants to the design of the machine tools used. It is in this broad sector that V-ENS competes and its growth potential is as broad as the entire global automobile industry.
V-ENS¡¯s technical experts have broad experience in the Korean domestic automobile manufacturing sector. They deliver top-notch product service through extensive network throughout the auto industry. The company¡¯s capabilities are extremely wide. Despite its short existence, V-ENS offers a total service in the product development sphere including platform engineering such as styling, CAE, design engineering, and T&D, and in production engineering it can handle process engineering, plant construction, and machinery & equipment.
So far, V-ENS has received overseas orders from Japan and Southeast Asia. From the service delivered in these two markets V-ENS is building its business model to develop a variety of service models. By successful service delivery and building of a business presence in these markets, V-ENS is developing the competitiveness it will need to enter developing markets such as China and India, as well as developed markets such as Europe.
Entering the Japanese Market
Building on the trust built up over many years working with Daihatsu Motor, the small car affiliate of world-famous Toyota, and its related companies, V-ENS is expanding its cooperative ties in the product development and production engineering sectors of the world-leading Japanese auto industry. On November 12, the companies concluded a Memorandum of Understanding(MOU) outlining long-term cooperation. According to the MOU, for the next three years the two companies will develop operations in auto development on a fully trusting and tangible basis and will set the stage for further mutually benefiting and more extensive cooperation in the future.
This MOU represents recognition within the Japanese market of V-ENS¡¯s excellence in design, production quality, services, and engineering capacity. A long-term cooperative relationship will secure a stable base for profitability, all adding to the immense significance for V-ENS of successfully penetrating an advanced automobile sector.
Early this year, V-ENS completed a one-year-long project for Daihatsu on an outsourced turnkey basis that encompassed total engineering services from detailed auto design to manufacturing preparation. Within three months of the successful manufacture of this model in August, orders have already reached 6,000 units, a considerable feat.
On top of this success, V-ENS offers Daihatsu considerable engineering abilities, and understanding of the entire process of developing a new car, and a spirit of self-sacrifice for the client. It was the deep and favorable impression all of this made on the top management of Daihatsu that put into motion the chain of events that led to the conclusion of this long-term cooperative agreement.
V-ENS¡¯s Competitiveness
The assets of a vehicle engineering service company are the rich pools of experience of its top experts. Accordingly V-ENS¡¯s assets are its acquisition of top-notch personnel. The majority of its employees have many years experience in auto manufacturing and related companies. They are especially rich in experience and know-how in helping clients solve problems and understanding the vantage point of a client. Building on LG CNS¡¯s IT infrastructure, an area of particular strength is digital engineering which has enabled them to build up a large pool of trustworthiness among auto manufacturing companies.
V-ENS¡¯s goal is to extend its service area to encompass the whole world. The aim is to grow into a company recognized as possessing world-class competitiveness in auto product development and manufacturing engineering services.
In order to reach this goal along with stable profitability and growth rates, V-ENS has devised a business portfolio plan. In addition in order to strengthen competitiveness it is boosting internal capacities and broadening its strategic ties with related allied companies. It is planning to follow up a successful entry into the Japanese and Southeast Asian markets in 2005 with a broadening of its markets to include China and Europe. Through the LG Group network it will expand operational channels and pursue coordinated strategic marketing with related businesses. In this way, V-ENS will widen its service area to cover the entire world in a most expeditious manner.
[Source: LG News, December 2004, vol. 23 No. 262]
