This report analyzes R&D investments by automotive companies in the Bay Area region. It finds that the Bay Area, especially locations like San Francisco, has become a primary focus for automotive R&D centers, with 27 OEMs and 37 Tier-1 suppliers now located there. Key technology areas driving this growth include autonomous vehicles, electric vehicles, connectivity, infotainment, and advanced driver assistance systems. Companies are drawn to the Bay Area due to the availability of skills in fields like UI/UX, data science, and materials research that are increasingly important to the automotive industry.

1. This report is solely for the use of Zinnov Client and Zinnov Personnel. No Part of it may be quoted, circulated or reproduced for distribution outside
the client organization without prior written approval from Zinnov.
This report is solely for the use of Zinnov Client and Zinnov Personnel. No Part of it may be quoted, circulated or reproduced for distribution outside
the client organization without prior written approval from Zinnov.
August 2016
R&D Engineering – Bay Area Analysis

2. Bay Area, Los Angeles, India, China, Romania andVietnam are attracting R&D
investments from G500 companies
Source: Zinnov GEIP

3. Bay Areas has evolved as the primary focus with all large Automotive companies
setting up R&D centres there
3
Autonomous
Electric
In Car
Experience
New Age
Infotainment
Ride Share
To invest $1 billion in SFO over next five years in AI
and self-driving cars R&D
Bay Area
Drivers Followers
Invests $182 million next-gen cloud computing
firm Pivotal for self-driving tech; developed aDrive
gaming atmosphere for autonomous test driving
opened R&D center in Sunnywale focusing on HMI
based virtual dashboard (DICE) and content delivery
Emerging Players
Ford Research & Innovation Center, Palo Alto, is
working with Carbon 3D to make elastomer
grommets for Ford Focus Electric
Mountain View and Palo Alto team work on HMI,
Sensor technology; created controller of iDrive
partners with Lyft to start ride sharing taxi trial within
a year
Tests its car sharing service DriveNow in Seattle, taking
On Car2Go
ERL integrated Google Earth maps into Audi’s navigation
System; a development hub for VW Group’s
new modular infotainment toolkit
Joint Research center with Argonne Laboratory
focusing on Li- Ion Batteries research
Source: Zinnov GEIP

4. OEMs andTier 1s have drastically increased R&D investments in Bay Area over last 5
years
3
4
5
6 6
7
8
14
19
21
1998 2000 2002 2004 2006 2008 2010 2012 2014 2016
Automotive Companies R&D Setup – Bay Area
Tesla’s first production
vehicle - Roadster was
launched
27 R&D Centers
OEMs in Bay Area
Tier-1s in Bay Area
No.ofAutomotiveCompanies
Year
Tesla’s Model S unveiled
3700 Engineers
Tesla Founded
Source: Zinnov GEIP

5. Need for New age skills in Automotive Industry is the primary driver for this shift(1/2)
5
UI/UX
Data
Science
Connectivity
Electric
Vehicle
Material
Research
1998~150 12% 17% 31% 9% 4%
2012~125 10% 30% 30% 5% -
1998~240 34% 22% 30% 4% 2%
2001~300 15% 30% 20% 5% -
Volkswagen ERL works on a wide set of disruptive
technology areas for the entire range of Volkswagen
brands; Also acts as a listening post for start-ups in the
Bay Area
The Palo Alto team developed a virtual test environment
based on gaming software, called aDRIVE that will test
algorithms such as traffic sign recognition in dynamic
driving situations
2003~2,800 9% 9% 10% 8% 4%
Tesla is a Pioneer in the Bay Area with its end to end
R&D location located there creating an ecosystem for
Automotive disruption
User Experience Design, Autonomous Driving,
Connected Car, Business innovation, Electric Vehicles
are the top priorities of the MBRDNA team
Toyota majorly focusses on AI and Connected Cars out of
Bay Area. Has plans to invest around $1B in Bay Area
focussing on the AI and Connected Cars
YoER&D HeadcountR&D Headcount
Source: Zinnov GEIP

6. Need for New age skills in Automotive Industry is the primary driver for this shift(2/2)
6
YoER&D Headcount
UI/UX
Data
Science
Connectivity
Electric
Vehicle
Material
Research
2014~50 18% 20% 2%
2010< 40 37% 22% - -
2013~35 3% -
2013~30 7% 18% 5%
Work on hi-end Infotainment & Connected R&D. Key
activities include Google Glass integration with ADAS and
Infotainment systems
The Silicon Valley Lab functions as a listening post for
startups and university research. Also has engineers who
work majorly on UI/UX for Infotainment systems.
1999~100 19% 18% 17% 4%
Autonomous Driving, Sensor Tech., Computer Vision,
ADAS, Battery Tech., are largely driven out of the Bay
Area center
Continental’s Intelligent Transportation Systems is
headquartered out of Bay Area that focuses majorly on
Connected Tech., ADAS and Autonomous Driving
Delphi’s laboratory works on infotainment systems and
crash-avoidance technology. Delphi has a connected car
start-up focus backed by a $100 million venture fund
70%
20% 4%
37%
*
16% 15%9%
4% 11%
Source: Zinnov GEIP

7. Bangalore
69 "Prathiba Complex",
4th 'A' Cross,
Koramangala 5th Block,
Bangalore-560 095.
Phone: +91-80-41127925/6
Singapore
Level 42, Suntec Tower Three
8 Temasek Boulevard
Singapore 038988
Phone:+65 6829 2123
Texas
21,Waterway Ave
Suite 300
The Woodlands
TX-77380 USA
Phone:+1-281-362-2773
Beijing
Meilifang Tower 4, Entrance 4,
10/F #1003,
11 Beiyuan Shuangying Road,
Chaoyang District, Beijing
China 100012
ThankYou
Gurgaon Office:
First Floor,
Plot no. 131, Sector 44,
Gurgaon-122002,
Phone: +91 124 4420100
California Office
3080 Olcott Street
Suite A125,
Santa Clara, CA 95054
Phone: +408-716-8432