And why partnerships with system-integrator experts are becoming a competitive necessity.
The automotive industry is in the middle of its most volatile era in generations.
New competition and new technology, alongside changing regulations and unreliable supply chains, is piling on the pressure for brands to survive and stand out. Differentiation has never mattered more – but the cost and complexity of achieving it have never been higher.
This is where a simple principle changes everything.
Today, around 20% of a vehicle’s features deliver roughly 80% of what consumers actually notice. The critical question for OEMs is: Are we investing in the right 20%?
How the Pareto Principle is shifting in modern vehicles
Powertrains – once a core differentiator – increasingly sit inside the ‘other’ 80% end of what is also known as the Pareto Principle. Unless a system delivers a generational leap, consumers now differentiate through software, interfaces, connectivity and the brand experience.
Yet automakers continue to devote enormous capital, R&D and manufacturing capacity to developing under-the-hood systems in-house, plant by plant and region by region. In a market where speed and flexibility are critical, that model is becoming hard to justify.
Read more about why the EU must adopt a technology-neutral approach to automotive.
The opportunity cost of in-house powertrain development
Capital, labor and other resources spent reinventing low-differentiation features and systems comes with an opportunity cost. That cost is rising fast.
- Software-defined vehicles are pulling more investment into architecture, security and UX
- Global regulatory changes demand faster platform adaptation
- New powertrain mixes – hybrids, range extenders, efficient ICEs and alternative fuels – need modularity, not re-engineering every time
- Volatile supply chains demand companies that can pivot quickly, without rebuilding entire manufacturing footprints
Large, vertically-integrated powertrain operations limit that agility. They anchor OEMs to fixed assets, fixed tooling and fixed assumptions about where value lies.
To compete in the high-differentiation 20%, OEMs need to free themselves from unnecessary complexity in the other 80%.
The modern global economy is dependent on efficient decision-making
Why partnerships with system-integrator experts are now a strategic advantage for OEMs
Economies of scale alone make a powerful argument for partnering with a specialist. But there is another reason why collaboration is becoming the new competitive edge.
Powertrains are no longer standalone subsystems. Integrating them into complex, modern vehicles can affect:
- ADAS sensor placement
- Infotainment and electrical architecture
- Aerodynamics
- Battery integration
- Vehicle-level efficiency and cost
- Global compliance
- Manufacturing efficiency
A simple supplier relationship cannot deliver this level of optimisation. OEMs increasingly need system integrators – partners embedded from concept to launch – who ensure the powertrain enhances the entire vehicle, not just the part it occupies.
This is precisely the model Horse Powertrain was built for.
Read more about how hybrids can speed up decarbonization.
How Horse Powertrain helps OEMs focus on high-value differentiation
At Horse Powertrain, our role is to remove the cost, complexity and time associated with low-differentiation powertrain development, so OEMs can redirect resources to the features that truly set their brands apart.
With 17 plants and five technical centers worldwide, our global network allows us to absorb manufacturing risk and deliver proven, efficient, compliant systems at scale – without requiring OEMs to build or maintain their own dedicated facilities. Our engineering teams work with OEMs across the full development cycle.
There are many roads to net zero, so the journey to low emission mobility requires hybrids, range extenders, high-efficiency ICEs, eFuels and more. Our platforms are designed to support this without additional capital expenditure or lengthy development cycles.
Our Future Hybrid System, for example, integrates engine, transmission, e-motor and power electronics in a single compact module:
- 25% narrower
- 150 mm shorter front end
- Up to 20% cheaper for AWD configurations
- Installable on mixed BEV/xHEV production lines – no structural redesigns, recalibration or new tooling
This allows OEMs to move quickly as markets evolve. By providing complete powertrain solutions, we reduce ICE-related investment by up to 50% and cut development timelines by months or even years.
Read more about Brazil's technology-neutral automotive policies.
Turning powertrain operations from a cost center to a competitive advantage
The 80/20 rule is not a cost-cutting argument, but a strategy for staying ahead of the competition.
OEMs that embrace the Pareto reality can focus on what truly drives customer value, while partnering with experts who can help them deliver innovative solutions better, faster and at global scale.
At Horse Powertrain, we enable exactly that shift.
We provide the systems, integration expertise and manufacturing footprint that free up OEMs to focus on the 20% of innovation that defines their brand to stand out.
Because in a market moving this fast, the real advantage isn’t doing everything.
It’s doing the right things.
For more information on our solutions, contact us.
