Ford goes for IBM/Dassault as well as EDS for its new engineering IT environment

Ford, the world’s second biggest automotive OEM, has finally broken away from its almost universal EDS-based engineering IT infrastructure, by awarding a massive contract to software giants IBM and Dassault Systems to provide product lifecycle management (PLM) and CAD software and services. Although terms of the long term IBM/Dassault deal have not been revealed, it’s clear that it will be very big. Sources talk of 4,000 to 5,500 seats, and the pair are to supply Catia V5 CAD/CAM and Dassault’s big Enovia PLM suite for Ford’s high profile design and manufacturing and ultimately its world-wide next generation C3P systems environment. Meanwhile, EDS has certainly not been pushed aside. It’s been awarded an expansion of its existing PLM contract, to provide some of the foundation for integration and collaboration in Ford’s multi-CAD global virtual product development environment. Software products involved include its Teamcenter (formerly SDRC Metaphase) PLM, NX (next generation Ideas CAD) and E-factory (digital manufacturing technologies now coming from EDS’ strategic partner, and IBM/Dassault/Delmia rival, Tecnomatix), also for the C3P project. However, EDS’ claims of “providing the corporate standard across all Ford divisions and out into the supplier community for enterprise data management, collaboration and visualisation” are plainly off the mark. Indeed, announcement and counter-announcement from the two camps over what are clearly big deals, prompted Marv Adams, vice president and chief information officer for Ford, to issue the following: “For years Ford Motor Company has pursued a multi-CAD strategy – that strategy has not changed. “Recent marketplace reports concerning Ford’s strategic direction in PLM software technologies and services are grossly distorted. Both EDS and IBM/Dassault are key partners to Ford Motor Company. “In addition to Ford making a commitment to IBM/Dassault for its Catia V5 and Enovia VPM technologies, Ford has expanded its commitment to EDS’ PLM Solutions software technologies and services as corporate standards for various aspects of its digital product development and manufacturing. “Ford will use EDS and IBM/Dassault in order to become more consistent across our brands world-wide and from that drive synergies and reduce costs. Over time, Ford’s next generation C3P toolset will cost substantially less than some have carelessly estimated. What we do spend will be more than offset by productivity gains in our product development processes.” Just so, but for the record, hitherto, Ford, and for that matter acquired Jaguar, have been virtually wall-to-wall SDRC Metaphase on the packaged PLM side. Word is that when SDRC was acquired by EDS, previously itself owned by Ford arch-rival GM, the world number one automotive OEM, Ford started looking for alternative engineering IT providers. So the deal with IBM/Dassault follows what has been a long term review, with some eyes certainly looking at Land Rover and Volvo Cars – both also acquired by Ford over the last couple of years – which have bespoke IBM PLM systems that successfully span engineering design and manufacturing production. Last summer, Matt Cadieux, Ford’s UK infrastructure manager, said of the mix of Ford CAD and PLM systems around the world: “There is a drive for common applications and business processes, because commonality means a more efficient overall organisation.” In the event, however, Ford has backed both horses. Sources suggest the firm will use Catia for body design, while EDS Teamcenter is harnessed for data management, analysis and manufacturing engineering. Ideas/NX would then be for interior design and development. That sounds far too simple and fails to account for the Enovia role, and the existing mix of systems, or for that matter the support, change management, skills and cost implications. More likely is a more pragmatic mix and match approach with local decision-making. Whatever, this is a key area for Ford which is staking its future and its financial health on achieving much faster and more efficient new product development cycle times – and managing that right through car lifecycles in the field – through virtual reality, data management and collaborative engineering and part sharing. This is a major and ongoing exercise. Analyst AMR’s senior automotive consultant Kevin Prouty says the IBM/Dassault duo is seeing significant growth in the sector right now, while EDS continues to suffer. “I do think that IBM getting several thousand Catia seats at Ford, on the heels of a very large commitment from Toyota [is significant],” he told MCS. That win, worth around $1,2 billion, was announced late last year, and was to replace internal development. Meanwhile, commentator Charles Clarke observes: “The most significant ramification is going to be felt in the supply chain. Part of the SDRC/Ford deal was that all their Tier One [suppliers] got SDRC for the same price as Ford. Ford has been the most vociferous of the OEMs to adopt a ‘love me love my CAD system’ approach to their suppliers, going way back to the mid-1980s.”