News that Renault suspected three senior staff members of industrial espionage around the topic of electric vehicles is almost of a quaintly ‘cold war’ flavour. A leading government figure in France has reportedly claimed that there is an ‘economic war’ underway in which both corporate and national assets were at risk.
An investigation is now underway, and of course full consideration of the incident must await the conclusions of this process that may lead to legal proceedings. On the other hand, it is useful to consider what exactly is at risk here.
A leading government figure in France has reportedly claimed that there is an ‘economic war’ underway in which both corporate and national assets were at risk.
There are two basic possibilities: technologies, or strategic plans. If it is a matter of technologies, the concern is that designs, tools or methodologies owned by Renault and able to confer competitive advantage have been provided to a competitor. If it is a matter of strategic plans, then again a competitor may have been given access to the forward plans of the company with respect to electric vehicles; presumably in terms of product plans, pricing, market volume expectations and so on.
However, it must be questioned whether there are any such technological ‘edges’ with respect to electric vehicles that cannot be contained by patent applications. The leaking of technology in this sense confers scant operational advantage to a rival, who is unable to exploit the knowledge so gained without obviously incurring a breach of patent rights. There are few corners of the world left where such an advantage might be used, and these are relatively trivial compared to the mainstream market opportunities.
Increasingly, in the contemporary market place, what matters more than actual patent protection is ‘speed to market’. It is important to exploit the commercial opportunity afforded by a technology before an alternative comes along that is better. Here perhaps there is a concern for Renault, because recourse to the law to recover patent rights can be slow and expensive.
Increasingly, in the contemporary market place, what matters more than actual patent protection is ‘speed to market’.
If the espionage relates more to strategic plans then again the concerns may be somewhat misplaced. It is fitting here to recall the plans laid out by Renault in 2007 ahead of the global economic crisis. Almost none of these plans came to fruition. Again, this is not a criticism of Renault as such, but is a reflection of the turbulence and uncertainty of the modern operational environment. It is almost impossible to forecast where the business or the market as a whole will be in five years’ time.
Moreover, in the emergent automotive industry of the electric era there are many more points of engagement with other sectors, other companies, and other interests. The situation is much more fluid than was ever previously the case. Relationships are formed and reformed continuously, as each business searches for a position in the emergent value chain. In this dynamic environment, even something as apparently straightforward as industrial espionage might not be quite what it seems. Executives could easily be engaged in the exchange of information with other parties while still actually seeking to further the long term interests of the business.
The cold war was simple. The contemporary business environment is not.
Dr Peter Wells is a Reader at Cardiff Business School, where he is a Co-Director of the Centre for Automotive Industry Research and leads the automotive industry research programme within BRASS, also in Cardiff University. Dr Wells is also a director of AutomotiveWorld.com’s sister website AWPresenter.com. He can be contacted on email@example.com.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.