Analysis & Synthesis

When the world’s automakers last convened in Frankfurt to display their latest and greatest models in 2011, the European auto industry was still reeling from the impact of the euro zone crisis which had done considerable damage to the economies and financial prospects of a number of Europe’s largest automakers. While the impacts of the far-reaching euro zone crisis continue to limit sales of new cars, automakers appear to be taking a cautiously optimistic approach to product development at this year’s show.

According to reports from the auto show, this caution is particularly evident in the lack of truly boundary pushing technology innovation on display, a result of the drastically reduced product-development budgets of many of Europe’s leading automakers, such as Peugeot or Fiat for example.  However, this reduced emphasis on new technology did not mean that automakers have abandoned electric vehicle development. On the contrary, several of the most buzzed about vehicles on display at the show came from the electric side of several automakers’ ranges.

Volkswagen, for one, chose to direct the spotlight onto its promising EV line, displaying its wide variety of electric vehicles which included the eUp! and several new versions of its eGolf model. Another European giant in Germany’s BMW introduced its first ever fully electric i3 as well as additions to its plug-in hybrid range, including the i8 and a prototype of the forthcoming x5 eDrive SUV model. Smart joined in on the EV parade, presenting a very early, as yet door-less, prototype of its forthcoming four person version of the current ForTwo Electric Drive. In addition to the strong full-electric offering, several automakers joined the plug-in hybrid fray in introducing new additions to their existing lines, these included both budget automaker Opel, introducing a stunning new concept car, as well as notorious gas-guzzlers such as Porsche’s hybrid Spyder.

This year’s Frankfurt show saw the continent’s automakers take an encouraging step towards increased EV development and a continued focus on the future of this crucial technology.

Source: Reuters report on Frankfurt auto show 

Independent Online Business Report article on green presence 

Bloomberg’s articles on the various automakers displays

CarScoops.com feature on the Smart FourJoy

Phys.org rundown of the new models introduced at the auto show

Digital Trends preview of Opel’s concept car 

Recent years have seen many people’s expectations for the electric vehicle industry begin to fade from the lofty heights of the industry’s early years, this has led many industry experts to recalibrate their predictions for the ultimate EV breakthrough. Ever since the industry’s dawn there has been no shortage of experts and analysts offering their own visions for the EV industry. Therefore, it comes as little surprise to find current analysts significantly divided on their predictions for the industry’s development.

Respected EV industry figures such as long-time EV activist, Nissan Leaf salesman Paul Scott, among the founders of EV advocate organization Plug In America, approaches the industry from a market driven perspective. Scott suggests that the coming tipping point for truly significant public adoption will come only when mass-market EVs reach range limits consumers feel comfortable with, an argument which is thoroughly supported by past surveys of prospective EV buyers and their concerns regarding the viability of EVs as every-day vehicles. Scott argues that the affordable version of Tesla’s EV, tentatively scheduled for release in 2017, will easily trump consumers’ range anxiety with its promised range estimate which exceeds 300 km on a single charge. Furthermore, the vehicle is rumored to retail for approximately $35,000 before tax breaks, therefore placing it in the same league as Chevy’s second generation Volt or future generations of the Nissan Leaf, which fall well short of Tesla’s 300km range estimate and, thus, opening a whole new section of the consumer market to electric vehicle ownership.

Offering a similarly technologically focused perspective is Stanford University energy expert  and author of the book Solar Trillions Tony Seba, who agrees with Scott’s vision in as much as the coming shift will be motivated by an expansion of battery capacity. Seba’s opinion is rooted in the consistently declining cost of battery packs and the savings which these bring directly to end-consumers. Seba observes that the cost curve of batteries is falling ever more quickly as the years progress and technology advances, the latest estimates from Detroit automakers suggest that lithium-ion batteries will reach $US 200/kWh by 2020. Seba believes that by 2030 battery makers will have long surpassed the crucial tipping point he places at somewhere between $250 and $300/kWh, with the low-end of this tipping point range set to be achieved as early as 2020, a development which he argues will essentially make gasoline burning vehicles obsolete.

Therefore, while these industry experts may differ slightly in the ultimate dates they set for the predicted mass-market adoption tipping point, Scott’s 2017 versus Seba’s 2020, the one aspect which they are generally in agreement on is the inherently crucial role which battery technology, specifically as it relates to capacity rather than charging speed, plays in achieving mass-market appeal.

Sources:” Paul Scott predicts electric car tipping point in 2017 at EV Summit 2013”  at Torque News

“How solar and EVs will kill the last of the industry dinosaurs” at REneweconomy

While western auto manufacturers clamber for entrance into the Chinese EV market, such as US automakers Tesla and Detroit Electric, China’s automakers have begun to draw back on their EV lines, concludes a recent article in Forbes which analyzed the current state of the Chinese EV market. While China may seem like an ideal place to root the first truly widespread EV market, given the country’s rapidly growing urban areas which are struggling with considerable congestion and pollution as is, Chinese consumers have shown little enthusiasm for electric vehicles. The slow sales of EVs in China have puzzled many industry experts who expected Chinese car buyers, many of whom are purchasing their first cars, to make for an ideal target as they had little experience or preconceptions regarding EVs or their differences from traditional gas-fueled cars.

However, despite recording an 11% gain in March over equivalent sales in 2012, sales of electric vehicles have been unimpressive; amounting to a total of 39,800 units, an estimated 80% of which are being used in public transportation. These anemic sales figures have led many of China’s leading auto makers to scale back their initial EV plans, choosing to shift their focus to research and development, focusing on lighter vehicles and less expensive means of achieving carbon reductions, instead of manufacturing and sales. While an understandable readjustment in the face of a market which is still growing, this trend among China’s car companies does little to support the Chinese government’s continued faith in the industry’s future.

While Chinese government officials, such as enthusiastic EV proponent Minister of Science and Technology Wan Gang, continue to actively promote the public adoption of electric vehicles both in word and deed, currently in the form of tax subsidies for purchases but future funding is likely to come through research & development support for manufacturers, they too acknowledge that the path to an all-electric future is likely to be rockier and longer than it seemed at first.

In the weeks following the announcement of Israeli electric vehicle battery-swapping company Better Place, on May 26th, industry experts have paused to reflect on the impact which this development has on the future of the electric vehicle industry. In the immediate aftermath of Better Place’s collapse the media narrative seemed to be guided by an overtly pessimistic tone which, while based in a shared disappointment regarding the failure of such a utopisitic vision, nonetheless seemed to quickly jump to predicting doom for the entire industry. However, a second wave of experts has begun to contribute to the discussion over the last week, offering a more positive perspective.

Firstly, some analysts have questioned even the conclusion that a battery-swapping concept is impractical and EV development will depend on the perfection of quick-charge systems, which would enable EV charging stations to serve as simple, quick-stop service points in the form familiar to owners of gas-fueled cars, or a resolution of range issues altogether through an expansion of capacity. Ron Adner, writing in the Harvard Business Review, suggests that many critics and commentators may have drawn the wrong conclusions from Better Place’s failure, locating the failure less in the concept or technology but in a flawed roll-out process and pace. Adner, through conversations with executives of Better Place over the last three years, concludes that one of the core flaws in the company’s approach to expansion was its rapid pace, a speed which ultimately placed a fatal strain on the company’s resources which Adner believes to have been unnecessary given the strong performance of its first two markets in Israel and Denmark.

Joining Adner in the chorus of support for the EV industry’s future is Gal Luft a senior advisor to the United States Energy Security Council, who comes to a similar conclusion regarding the causes of Better Place’s failure, ones due to business model and approach rather than industry conditions, and goes on to argue that the future remains promising for EVs. Luft acknowledges that the recent string of highly publicized, often publicly funded, failures which has taken down a number of the more high-profile electrification upstarts (Fisker, Coda Automotive, and A123 Systems) has cast a dark shadow on the industry in stark contrast to the blue sky optimism evident only a few years ago. However, he goes on to highlight a number of players still alive and competitive in the industry, such as Tesla Motors which continues to increase its value and annual performance, and the promise they bring.

Furthermore, Luft’s central message is the incredibly fast pace of technology adoption which the EV industry is currently undergoing, one which, when compared to the adoption curve of a vast number of today’s most common place technologies (such as the television, personal computer, or even the cell phone), signals a continued rise for the technology as it continues to mature. The rapidly maturing technology and promising adoption curve are further bolstered by the positive word spreading forth from early adopters, which Luft claims has been overwhelmingly positive, so why does development seem to be stalling? Luft suggests that the major force preventing the industry’s continued rise is the ever crucial aspect of government support, referencing the combative political atmosphere which continues to distort public opinion and limit funding in the United States as well as many European countries.

Through the considered analyses of these industry experts we can see that our hope for future success is not nearly as unfounded as early reactions appeared to imply, however this hope must be coupled with a strong effort to shift public opinion towards EVs and thus create a climate more conducive to public funding and political support for this development.

Read more: "Don't Draw the Wrong Lessons from Better Place's Bust" (Ron Adner, Prof. of strategy at Tuck School of Business at Dartmouth College)

Gal Luft (senior adviser to the United States Energy Security Council) "Better Place May Be Dead, But the Electric Car Isn't"

This past year has seen a careful readjustment of expectations concerning the future of the electric vehicle market among the world’s leading automakers. The world’s top auto shows, from Detroit to Geneva, have shown evidence of a gradual return to the past after 2012 auto shows the world over presented an auto industry proud of its electric vehicle innovations and suggested a continuing trend of evolution alongside a budding consumer market. However, this year’s shows saw automakers scaling back expectations to a significant degree, while many top brands continued to introduce new electric versions of existing popular models and lowering the prices of their existing EV options, remarks from the heads of these companies suggested an altogether different reality in the board room from that of a year ago.

There is a trend which seems to have taken root among auto industry leaders towards decreasing EV related technological innovation efforts, improving the consumer attractiveness of existing EV models , and supporting further charging infrastructure expansion while relying on traditional gas-fueled and hybrid vehicles to ensure market competitiveness. Do these market expectations actually reflect real world consumer sales and government attitudes or are car manufacturers too quick to retreat from this frontier?

The latest sales figures from France suggest an alternative narrative to that presented by auto makers, this April saw France’s automobile industry record a remarkable 1 500 new electric vehicle registrations, taking 2013’s cumulative sales total to 3 188, compared to 2012’s 1 595 from the same time. This explosive growth is largely driven by another of the key factors influencing the future of the electric vehicle industry: government incentives. The French government continues to show strong support for consumer EV adoption, offering new vehicle owners a € 7 000 tax incentive.

The French government’s support for the EV industry is also evident among the leaders of one of Asia’s mega-cities, the city of Beijing recently updated its target for electric vehicle use, setting an ambitious goal of having a  total of 50 000 electric or hybrid vehicles on its roads by 2015. While this target includes city vehicles and such fleet vehicles as taxis and buses, authorities are also making an earnest attempt to drive consumer purchases as well by offering private citizens a tax incentive worth just over €7 500. Alongside these tax incentives the city also plans to support infrastructure development, an increasingly crucial step in increasing consumer confidence in the viability and practicality of electric vehicles, by installing the world’s largest charging station in the city, servicing up to 400 electric vehicles at once.

Finland too continues to evolve its charging infrastructure, a network which currently includes 247 public charging posts across 45 stations, the largest of which is located in Helsinki and features 13 charging posts while the single greatest concentration of charging posts is Oulu’s 162 posts. On the strength of the actions of local and national governments, such as those of Finland and China, a recent study by IMS Research suggests that the current global network of 135 000 charging stations will undergo massive growth over the remainder of the decade, reaching 10.7 million by 2020.

These recent findings will certainly come as a great relief to the present EV owners as well as a further encouragement to potential customers currently dissuaded by range anxiety and issues regarding the comprehensiveness of the present charging network, two of the most consistently expressed concerns plaguing gas-drivers.  Furthermore, researchers also believe that the US will be a significant focus of this development, alongside China and major European population centers, a promising finding considering that the United States recently passed the 100 000 unit mark for electric vehicles sold in the country, a development which signals a resistant faith in the future of electromobility in the face of a popular culture and political environment which, following the fallout over government support of electric vehicle start-ups that have failed to reach their initially lofty goals, seems anything but welcoming to the future of sustainable urban living.

Thus, while auto makers have begun to bow to market demands and fiscal realities, it seems that governments and consumers continue to keep the electric vehicle dream alive while they wait for the rest of society to catch up.

Read more: Electric cars back into the shadows at Geneva car show (phys.org)

Detroit Auto Show: Electric Vehicles, Automated Technologies Bring Innovation To 2013 NAIAS (Huffington Post)

Electric Vehicle Sales in France Double in First Four Months of 2013; Fluence Z.E. Sales Equal Zero (Indisde EVs)

Beijing: 50,000 Electric Cars By 2015, 30,000 For Private Uses  (International Business Times)

Sähköautojen julkiset latauspisteet yleistyvät Suomessa - Mikkeliin oma piste (YLE news; In Finnish)

Expect millions of electric car charging stations by 2020 (NBS News)

100,000 Electric-Drive Cars Now On American Roads (EVWorld.com)

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