Going to market with a flexible ownership and global franchising business model for their electric cars required e.GO to think through the entire product lifecycle—from design and production to sales and service—and to incorporate the technology needed to sustain their approach from the very beginning.
e.GO is a German electric car manufacturer with an innovative vision for the future of transportation: low-cost electric vehicles designed to meet modern customer, market, and climate demands.
e.GO takes a disruptive, tech-first approach to closed-loop manufacturing
Leveraging PTC’s technology suite and Microsoft Azure, e.GO created a digital thread spanning every part of their business, from engineering to manufacturing to the end-customer experience. Ernest Debets, Vice President, Information Technology & Digitization at e.GO, recently sat down with PTC’s Craig Melrose to discuss how a holistic approach to digital transformation is bringing the company’s business model front and center and driving strategy across the entire organization.
Read on for some of the key learnings discussed in the webinar, and register for exclusive access to the full recorded program
Understanding the market drives business model design
As a digital start-up, e.GO had a unique opportunity to create a business model designed to combat one of their most pressing challenges: the established competition in the electric car space.
e.GO approached this challenge by surveying the market, including other electric car manufacturers and the customers they wanted to reach. They found that luxury car manufacturers have slim margins, as high-end electric batteries are expensive to install and replace. Likewise, more economical manufacturers also struggle with margins, largely due to the up-front production costs associated with highly automated factories.
No matter how it unfolds, the business of creating an affordable electric car is a challenge in financial sustainability—and that’s where e.GO wanted to set itself apart. Eighty-three percent of people drive short, local distances totaling fewer than 30 miles a day—and this reality became the foundation of e.GO’s business model. There was a real opportunity to appeal to urban dwellers or those in the market for a second, everyday sort of car. To get those people behind the wheel, e.GO marketed the car as a potential rentable income generator, similarly to how some people rent out their homes on a short-term basis. They are also currently considering a subscription service to appeal to those who don’t want to outright purchase their own car, but still need occasional access to one.
To scale efficiently, e.GO devised a global franchise model with easy-to-replicate production technology that could be licensed to business owners around the world. This microfactory setup relies on a blend of automation and operators, and Industry 4.0 technology helps the workers be as efficient as possible by having data at their fingertips.
Going to market with a flexible ownership and global franchising business model required e.GO to think through the entire product’s lifecycle—from design and production to sales and service—and to incorporate the technology needed to sustain their approach from the very beginning.
Establishing a digital thread across people, processes, and things
To make their vision a reality, e.GO partnered with PTC and Microsoft to establish a digital thread through every aspect of their work. They leveraged a lineup of PTC products, including Windchill, Creo, ThingWorx, and Vuforia augmented reality suite, as well as Microsoft Azure for secure cloud storage.
A critical decision was to establish a real-time, single source of truth using Windchill for product lifecycle management (PLM). Windchill is a comprehensive PLM solution for data governance and traceability, providing an authoritative source of truth across engineering, operations, suppliers, and end-users. “We need to make a lot of changes quickly,” says Debets of the product design and engineering. “You can only do this with a platform that automatically pushes changes to every file where those changes need to appear—and makes the same data available to everyone.”
They’re also using Creo, PTC’s computer-aided design (CAD) software, for a fluid design process that can be easily shared with franchisee partners. In vehicle design, time, cost, quality, and availability are essential considerations. Part of what contributes to e.GO’s design and production efficiency is that they use standard components from leading OEMs, rather than costly custom parts that take longer to fulfill. Consequently, they sometimes need to adjust designs quickly based on what’s available and affordable, and then communicate changes to engineering teams locally and in franchise countries—and Creo makes this possible. e.GO even invites suppliers to work in their CAD system, making them more like partners, rather than just vendors.
Inside the factory, everything comes together with ease thanks to a digital twin system. e.GO relies on data from the ThingWorx IIoT platform to create a digital representation of nearly every physical object used. That digital twin stays with its unique car, tracked by the physical VIN, throughout the car’s entire lifespan—which can be up to 50 years. If changes are made to the car model, the digital twin is updated to reflect subsequent changes to the engine, drivetrain, or safety components, for example—and that data is hosted on Azure and easily available to everyone on an enterprise level throughout their IT systems. This enables the sales and service departments to drive greater value for customers with personalized offerings such as preventive maintenance.
When it comes to assembly, the digital twin knows exactly which configuration is coming down the line, using the VIN to determine the exact next step that the operator needs to take. “It’s almost like the car is talking to the operator,” says Debets. The directed task can be as simple as picking up a nut driver and holding it to a bolt. The automated system makes the task even simpler by knowing how much torque to apply.
Augmented reality (AR) has also become critical to e.GO’s vision for building an affordable car and is leveraged during assembly and quality testing using data stored on Azure. The operator uses a tablet to view an AR app powered by PTC’s Vuforia Studio. The app identifies the specific car they’re looking at; depending on that car’s configuration, the app pulls in criteria for how to conduct the quality check. The worker is guided to specific points requiring inspection and can communicate with the app to retrieve relevant configuration data and input quality data back into the system. Additionally, AR will become especially helpful for training new workers or geographically diverse workers once the global franchise model is fully implemented, as AR’s built-in capabilities guide the user through step-by-step instructions with key on-screen visuals.
Debets explains that being very intentional about establishing a digital thread early in the process is what has helped keep operations running smoothly. “It’s very systematic. CAD designs the parts, PLM puts them together in configurations, and then that data is stored in Azure and used in an IoT setting to understand the VIN.” He continues, “AR uses the data to say if it's the right shape, fit, and quality. Then a photo gets snapped and tagged back to all of that data in the digital twin, and it'll forever be with that model.”
A digital-first mentality
By adopting a digital-first mentality with support from PTC and Microsoft, e.GO has laid the foundation for continuous improvement well into the future. Debets says it’s really all about a mix of careful planning and an openness to technological innovation. “You start by thinking about your business model and future models to follow,” he says. “And then if you carefully consider what processes and data models you need to support the business, you can move quite quickly. You just have to have the discussion up front and plan for the data you need.”
The data, says Debets, supports every aspect of the business. “The data tells the story in real time. As a result, everything is mutually enforcing,” he adds. “Once you've invested, the process pays for itself.”
Leveraged a suite of PTC products to enable a digital thread across their entire operation:
- Reduced errors and time to market with improved design change management
- Improved throughput and production via IoT-enabled automation
- Improved labor efficiency, quality, and training by leveraging AR during assembly and testing