Collin Shaw of MEMA Original Equipment Suppliers

Overview

JOHN: Today in The Garage, live from CES 2025, we’re with MEMA. Let’s go.

JOHN: Welcome to The Garage. I’m John Heinlein, Chief Marketing Officer with Sonatus. Today we’re filming live at CES 2025 in Las Vegas. And my guest today is Colin Shaw, the President of MEMA. Collin, welcome to The Garage.

COLLIN: Thanks, John. Appreciate it.

Meet Collin Shaw

JOHN: So I’d like to begin by learning about you. Tell me about you and your background.

COLLIN: Yeah. So, I have quite a varied background in automotive. I started in automotive about 15 years ago, and I started my career at Fiat-Chrysler. And I had the opportunity to work in the Jeep brand and really learn and understand how important strong brands are in automotive. I managed the Grand Cherokee. I helped work on global marketing and branding as Jeep was launching globally. But then I got a great opportunity to switch paths a little bit and go into commercial vehicle. So I then went to a company called WABCO. They were a storied brand, Westinghouse Air Brake Company. They did brakes, steering, ADAS, all for commercial vehicles. And I thought going into that, yeah, it’s a vehicle, it’s going to be pretty similar. Totally different market. And I loved it. Commercial vehicles are amazing. The people that support the industry are amazing. So I spent about five years there doing marketing, business development, strategy. We looked at connected trailers. We looked at connected trucks. It was an amazing experience. They were acquired by ZF. And so then I got the opportunity to work under Martin Fischer as the Director of Business Strategy for the Americas at ZF. And really, that’s where I started to get a taste for software-defined vehicles and understand the power that bringing together disparate components in a vehicle can do to help make a more seamless experience for customers.

And then, shortly after that, I got a great opportunity to lead what was the Heavy Duty Manufacturers Association, HDMA. It was a division of MEMA at the time. And I was the president of that group, and we focused on suppliers to commercial vehicles. So trucks and trailers. And, about two years ago, we merged four groups together and said, let’s just create two groups, original equipment and aftermarket. And so I represent about 500 suppliers in the original equipment space, and they supply to Paccar, Navistar, Daimler, Ford, GM, Stellantis. As long as they are suppliers into those OEMs, they can be members of ours. And that’s who we represent.

JOHN: Fantastic. You’ve got an incredible background to have such a wide range from marketing to business development and brand management. That’s great. And so, I always like to get to know our guests. You got to tell us a fun fact about you.

COLLIN: Fun fact. My Apple Music or Spotify wrapped. I’m a huge metalhead. I love heavy metal, but Taylor Swift by far was my number one most listened to artist this year because that’s my airplane music and I spent a lot of time on airplanes this year.

JOHN: That’s fantastic. Okay, so I always try to come up with a fun fact to match my guests. And I have to tell you about my daughter and my wife are massive Taylor Swift fans, as you might imagine. And so the Eras tour last year, we all went to that and they were going to go without me. And I said, okay, no, I’ll go. And it was an incredible experience. Well, let’s get into the conversation. And I think you’re… it’s so great to have you on because you bring such a wide perspective from the industry. I love to hear your thoughts. First, you mentioned earlier briefly about software-defined vehicle. What do you see as the opportunity for you and for your member companies for SDV?

The opportunity in SDV

COLLIN: Yeah, it’s really a fantastic opportunity. And I think what’s important is that software-defined vehicle can be confusing to people. But when you boil it all down, it’s really all about taking the thousands of components on a vehicle and making them talk to one system. Right now there’s thousands of suppliers, thousands of people producing components that go on a vehicle, and they don’t all talk. They’re all discrete. They have their own microcontrollers.

JOHN: Incompatible, generally.

COLLIN: Incompatible. And many of the suppliers have been honing these softwares, like a braking or steering software. You know, they’ve been honing it for decades. But what this is about is about bringing them together into one area so they can start talking to each other. And they can interact and you can have better control, better dynamics, a better customer experience, better aftermarket experience. And so when you think about that, you think about the ecosystem that cell phones have. You know, that’s where automotive could be moving, is a vibrant ecosystem of software and hardware to help enhance customer experience and to make owning a car better, easier, diagnosing problems… Just the confluence of having all these systems speak to each other, while also now this incredible rise in generative AI and large language models. I mean, the possibilities are endless. And whether you’re an average person with, you know, average level intelligence of a vehicle, you know how it… you know what a steering wheel does and what a brake pedal does. Or you’re professional truck driver and you’ve got 3 million miles. This opens up a lot of possibilities to help you become a better driver and also to help your company– Let’s say you’re a fleet– diagnose issues and keep your assets on the road.

The myth of SDV

JOHN: Right. It’s such a wide range of opportunities available because I think some people are afraid that shifting to SDV will eliminate companies. Will add complexity. But I think it’s really the opposite. I think it provides the opportunity to innovate in smarter ways. It provides the opportunity to have better validation and easier integration while still having specialized expertise. There’s going to be a need for tier one suppliers. There’s going to be a need for expertise in these subsystems, because no one company can have all the expertise. But as you said, when you integrate them together today, it’s very tough to validate. It’s very tough to maintain. The supply chain crunch showed us how much there was a lack of understanding of the diverse systems in there. And that’s why companies had line down, because of that lack of transparency in a sense.

COLLIN: Yeah. And I always like to… when I think of innovation, every time new innovations come about, there’s a segment of the population that thinks it’s going to destroy jobs. What we’ve seen since, you know, the early 1800s and we’ve seen massive and rapid technological innovation, it’s only created opportunity and jobs. It’s only created wealth. It’s created prosperity. It’s created a better standard of living. And I think this is, you know, one of those things that as we automate things more, we have these opportunities. It does just create opportunities.

JOHN: Right. And, you know, I think… I want to use the example for a moment, but I want to first caveat, because we often talk about– some people talk about– vehicles are smartphones on wheels. We think that’s a terrible example because…

COLLIN: Yes

JOHN: …but, we think it’s much better to think about it as more like data centers on wheels, because a lot of the issues in data centers, a lot of the reliability requirements, the workload isolation requirements in data centers. But if we take a moment with that caveat in mind, when the iPhone came out. It was a fine phone. The first generation is pretty crappy, got better over time. But the App Store that they created has created, I think it’s a trillion, you know, trillion dollars in value since then. From nothing. Now, again, I’m not suggesting that all we do is put apps on cars. That’s not the point. But the idea, as you said earlier, about the ecosystem and opening up the ability to have more people put software in with the right framework, with the right safety, with the right mechanisms can be amazing potential.

Aftermarket upgrades from software

COLLIN: I think about when I was at Jeep. You think of the aftermarket capabilities for a Jeep Wrangler. You know, people would buy a $40,000, $50,000 Jeep and then spend another $40,000 or $50,000 just in aftermarket upgrades.

JOHN: Right.

COLLIN: And think about how that would now apply to the software world. People want to be able to customize. We always are looking for ways to do that. Software gives us another layer to help more personalize and customize our experience. We all do it with our own cell phones, right? We do it with our own cars, right? This just gives you another layer to personalize and customize.

JOHN: We were chatting about this a few months ago, and we talked about how there are a lot of guys, you know, people, drivers that love to hack their cars. Maybe they buy a chip, you know, they change the chip, make performance in their cars. But that’s a tiny fraction of the drivers. I’m not willing to do that in my car. But if you had something, let’s say something that was even sanctioned by the OEM where you could have performance upgrades or customizations of various types, driving feel or whatever, people would be happy to pay for that. If they knew they were getting something that was OEM blessed. They don’t have to rip their car apart. They don’t have to worry their car is going to break and get out of warranty. They would be thrilled to pay for that.

COLLIN: They would. I… you know, I’m going to take a simple example. My car has an auto-off feature where the seat automatically scoots all the way back. But as my son gets older and he’s grown like six inches, it crushes his knees. It would be great to just download a simple app for me to customize that on my own. Like, just go back like three inches, give me a little more space that way. That’s what I mean… that’s what I like to think of.

JOHN: It’s such a simple example. You know, it doesn’t have to be complicated things. In fact, we were showing you a demonstration just outside the podcast studio here we have our demonstration of our Automator product. We were just showing you an example of that. How easy it is with our Automator, which is our orchestration platform, to be able to do very simple customizations and complicated customizations without programing, without OTA updates, very simple to do exactly what you just said.

COLLIN: Yeah

JOHN: We want to unlock that kind of capability for OEMs.

Protecting safety

COLLIN: Perfect. And what’s great is that we can create layers of safety too.

JOHN: Yeah.

COLLIN: Security is of the utmost importance. And with these advanced computing methods you can create those layers of security. So you’re not going to mess with the braking system either.

JOHN: Yeah. It’s actually… it’s very important. I didn’t get to mention this to you before we started, but just in December, we received ASIL-D – Delta – certification for our automated safety interlock, which now unlocks the ability to do that same kind of customizations during a drive. Which is very, very powerful. So we really appreciate those comments.

Software in commercial vehicles

JOHN: You mentioned you were in a commercial vehicle space, and we’ve been working hard over the past year with commercial vehicles. We got this fantastic skid steer loader outside, which is this amazing vehicle that allows you to move, you know, gravel and aggregate and something like that. And I was showing you how the same kind of capabilities we have in our passenger vehicles can be applied to that vehicle as well. Talk to me about some of the opportunities in commercial vehicles. And what do you think is possible?

COLLIN: I think this is really the most exciting thing. It’s never the most sexy thing, but what innovation does is it helps us to take away those things that are just mundane and redundant and helps us to focus on the important things. And I think what you get in the commercial vehicle market is drivers who are the best at what they do. I have to commend the drivers out there that drive professionally because they do help keep our roads safe. They’re the best of what they do. And being able to take what’s in their head and use that to help diagnose problems.

JOHN: Right.

COLLIN: You know, maybe one of these professional drivers has a problem on their truck. A large language model for a fleet can take that into account, and it can help other drivers when they’re diagnosing issues. They can more accurately describe what’s happening in their vehicle when they’re ready to go for service. And when you’re dealing with an asset that if it’s down for an hour, it could take 4 to 5 days to recover the cash lost on that.

JOHN: Absolutely.

COLLIN: You need to be able to unlock what’s in their head to keep that asset on the road. And I think we’ve just scratched the surface of what we can do in the commercial vehicle world because of how smart the fleets are, the drivers are. You know, oftentimes, they know their products better than the suppliers and the OEMs. And being able to take that knowledge and use it for good and use it to help keep assets on the road and make us more efficient. That’s what I’m most excited about.

JOHN: It’s really a good point that the difference between passenger vehicles, of which we’re in production today, 3 million vehicles, is no slouch. That’s great. But the interesting thing about passenger vehicles is, and commercial vehicles, commercial vehicles is a revenue generating device. Passenger vehicles are important. The driver cares. You want to get your vehicle to be reliable. But a commercial vehicle basically prints money as it runs. And so the ability to do fleet diagnostics, the ability to do analytics about vehicle data is a completely different value proposition and very… a great ROI for everyone involved.

COLLIN: Yeah. And I think, you know, you look at large language models and you apply that to, let’s say you’ve got a thousand fleet vehicle, and you can apply some of those learnings to the diagnostics on your entire fleet. You start having one thing go wrong on a vehicle. The AI or algorithms can take over and say, hey, we’re going to look for this problem throughout the entire fleet. Or maybe we’ve got some weather systems in certain areas. It really unlocks a lot of ability to keep assets on the road. And trucking is… it’s a very low-margin business. It’s built on volume. So you’ve got to do everything you can to keep that truck on the road.

JOHN: That’s right. The loss of productivity of just an hour or a day of downtime is staggering. It pays for all these innovations ten times over.

Diagnosing problems with AI

JOHN: We had a chance to show you earlier our demonstrations of our AI Technician Builder, it was very much similar to what you’re saying. Where using large language models, using big data, you can not only provide analytics of one vehicle, but as you very wisely say you can then take the learning from that one vehicle, and when you see a pattern extended to other vehicles. And then using some of our other tools, then, look for those problems to see if they’re pervasive or just 1 or 2 vehicles. Very powerful stuff. So AI is a huge focus for us in 2025. We’ve got some fantastic things we’re showing and we’re looking forward to rolling out more in the year. So I’m so excited to hear that you’re interested in it as well. Do you feel like you’re… do you speak for your members in the sense that they’re interested in this as well, or are they hesitant?

Protecting algorithms

COLLIN: I think it’s a mixture. With such a radical change in vehicle architecture between EVs, software safety, autonomy, understandably there’s nervousness in the system. How does… you know the secret sauce of many components is two pieces. It’s the component itself. And if it’s an actuation component, like a braking system or a steering system, that’s really important. But it’s also the software behind it. You know, the software to brake an 80,000 pound truck that one day could be 20,000 pounds and another day could be 80,000 pounds is really intense. And protecting that secret sauce is really important. So I think that’s a legitimate area of concern that if my software now does not live on the part I create and it lives in this centralized unit, where does my value come from?

JOHN: Well, you know, how do you protect the ownership? That’s… and these are… I mean, that’s something which is an understandable concern. Once again, these are examples of solved problems. I mean, there are proprietary algorithms, for example, media players and so on like that. There are many proprietary products that exist today in the cloud. You use, I use, that are nonetheless protected. So I think we need to bring those same kinds of innovations so people can be confident that their models can be protected and they can still get compensated.

COLLIN: And I think, you know, the suppliers that embrace this, they think, hey, I have got this piece of software that doesn’t need to live just on this one thing I do, but I can proliferate it. I mean that’s powerful.

JOHN: The upside potential is there.

COLLIN: You think about ADAS software. I mean, no longer does it have to be paired with the hardware you’re doing, but you can democratize that and you can monetize it. Those that take this model and I mean, we’re going to see a ton of innovation on it. They’re going to be very successful, and they’re going to see a different way of providing value for themselves and for their company than you would otherwise. Because not only then are you limited by just your hardware, you can start working on other pieces of hardware. There’s aftermarket implications. There’s all these things that open up the door for yourself.

JOHN: Right. Right. Well, I mean, actually, it begs the question. It sounds like you believe that the shift to SDV is inevitable.

COLLIN: Yeah.

JOHN: I mean, you’re long on the software fine vehicle shift.

Benefits for low-cost vehicles

COLLIN: I think it only makes sense. We’re all looking… We were all 20 year olds at one point. We all needed basic transportation. My daughter, she drives a hundred-thousand-mile Jeep Wrangler. At some point, we’ll all just need basic transportation. In my opinion, the ability for this is to simplify the vehicle. Put everything in a centralized place. You know, right now there are hundreds of microprocessors and controllers on a vehicle. That’s not very efficient.

JOHN: It’s not.

COLLIN: So the ability to centralize things. Ideally, in an ideal world, an electric vehicle has less moving parts as well. And so as we think about trying to provide affordable transportation, because that’s something that is really important. And I think sometimes we forget that when we come to these shows and we see all this fantastic technology is, yeah, we also just kind of need a basic car sometimes. This really has the ability to help solve some of those problems. But also make the experience fantastic for that young driver.

JOHN: Yeah.

COLLIN: And so I see a world of possibilities here.

JOHN: And I think that’s a good observation because today I think there’s the perception, and to some extent today it’s true, that SDVs tend to be in the higher end models because there’s glitzier tech…. But the reality is that the cost savings and the simplifying of SDVs can also benefit the low end vehicles as well, once you’ve kind of crossed the Rubicon into the new architectures that enable this.

COLLIN: Exactly.

JOHN: In a similar way. And you mentioned EVs, the shift to EVs. And I understand that there’s a lot of different thinking, you know, about, are EVs beneficial? Are they not? Are they ready? Are they not? And there’s no single right answer or a wrong answer about that. But what EVs have shown– similar to what these other things like smartphones and other things– what EVs have shown is, look what’s possible. They are so much simpler. And so to some extent of course for those… if we’re sticking on ICE engines, of course there’s going to be additional complexity and that’s fine. But one can still take some of the learnings from the simplification, from the consolidation to say, why am I making things complicated unnecessarily? And then, yes, there’ll be a shift to EV and sooner or later we can see where then you get an additional mechanical simplifications. But the technical simplifications can begin earlier.

Software and Taco Bell, the great equalizers

COLLIN: Yeah. And you have to think like our industry came about developing a body, a chassis, electrical.

JOHN: As silos.

COLLIN: As silos. And none of these ways to communicate existed back then.

JOHN: Oh sure.

COLLIN: And so everybody just kind of… that’s just how you develop cars. And that’s how car companies are organized. But now software is the great equalizer. I kind of look at it like Taco Bell. Everybody loves Taco Bell. It’s a great equalizer. So is software. Everybody loves software. It helps simplify things.

JOHN: Yeah. And I think you can’t know… this is the most important thing to me, maybe, at the end of the day is, you don’t know how you will want to use these systems. You don’t know the kind of algorithms that will come. You need to anticipate this. We often say, you need to anticipate the algorithms you don’t know about, and the use cases you don’t know about, not just making it be efficient for the ones you want. And I think those companies that do, will do better. You know, we’re in a time when there’s a lot of cost pressure right now. There’s some challenges in the industry in certain sectors and that’s real. But the reality is, if you look back at the last recession, you know, 2008 or thereabouts, and in the prior one, those companies that invested in the future are the ones that skyrocketed out the other side. And so we can either– we as an industry– can either retrench and say, I gotta hunker down. I gotta save costs. I got to stop innovation, which is the natural thing to do. Or we have to say, I have to bite the bullet and look for how do I be more efficient? Because I know that’s going to make me a winner at the end of this.

COLLIN: Absolutely. And that’s I think the next step is how to deploy these efficiently in your operations. Yeah, that’s a question I get. That’s probably a topic and story for another day.

JOHN: Maybe that’ll be our next… when you visit us next time.

COLLIN: Yeah.

JOHN: I’ve really enjoyed this conversation.

COLLIN: Thank you so much.

JOHN: Thank you for visiting us at CES, and I hope to see you at future events. And thank you for bringing your ideas to us.

COLLIN: Absolutely. Thank you.

Conclusion

JOHN: If you like what you’re seeing, please like and subscribe to see more episodes like this. Both live from CSE 2025 and back at our home studio. We look forward to seeing you again very soon.