Strength And Growth


ELIZABETH H. LEE                                                                                                                               CARMUDI - MARCH 2018

"Strength and growth come only through continuous effort and struggle  -Napoleon Hill

Herculean effort and tremendous struggle comes with being in the innovative space of electric vehicles. Are we to see the efforts bear fruit soon? If we are to keep tabs on commitments, the answer is encouraging. Norway's target is to end sales of internal-combustion engines (ICEs) by 2025, France and the U.K. have set their sights on 2040, with Germany, China, and India looking to do the same.

Tipping Point?

If we set our sights on the two most populous countries in our side of the world-China & India meeting their goal, the end game that is 'electric', will be moot and academic. With the two countries having the largest car markets and relatively low car-to-people ratio, the leap to cheaper electrics will be easier and faster given government mandates, not to mention the fact that both countries house manufacturing giants already in the electric vehicle realm. In this case, it is the government that will be the most influential ace card for electric vehicle implementation and adoption.

Both countries are building charging stations with New Energy Vehicles (NEV) making up the future sales of vehicle growth particularly in China. Although the total base sales is relatively small, the growth trajectory will be steeper for electrics. China's government mandates manufacturers to sell 8% of their vehicle sales to be electrics or hybrids, with the share rising to 20% by 2025 according to the official China Daily. Automotive brands who aim to protect their piece of the sales pie in the country, stand to win by ramping up its electric vehicle mix. The fact remains, that EV usage from 2-wheel (e-bikes), 3-wheel (e-trikes), 4-wheel cars and above, is already huge in China. If the major auto brands don't scale up their EV offerings, they will be swamped with the more aggressive Chinese brands in their own home turf and perhaps beyond.

Catch 22

A major part of the reason why manufacturers are slow to push that pedal towards full throttle on electrics include costs, budgetary constraints, large investments already sunk in ICE platforms, expensive initial outlay for new technologies, customer demand in a "wait & see" attitude for those who need long range traveling, and lack of charging infrastructure.

However, the same issues are faced by all players in the industry with some China brands looking less worried than their more established counterparts. Make no mistake, the dragon is awake. Indeed, the giants of the automotive industry is going through some uneasy rough patches to secure their future. The ability to be agile, quick, flexible, is becoming much more relevant as a key success factor. The automotive world is being disrupted in more ways than one and, as they say, it's good to be the disruptor but painful to be the disrupted.

Rapid development in automotive technology are being done and massive investments in batteries, and charging infrastructure continue. The race to a cheaper, longer lasting battery is ON and luckily for us, many-the big boys, the newcomers, and governments are placing their bets.

Rapid Acceleration

As battery costs continue to come down drastically and EVs come in easy plug and play models with charging infrastructure to be seen alongside the very same stations who sell petrol (ex. Shell building high-power EV charging stations), the future for EVs and a cleaner environment is in the not-too-far horizon.

In the meantime, the rise in connectivity using IoT and big data can help make the transition from ICE to zero-emission vehicles from the point of view of CO2 reduction, more efficient. IoT enabled cars can help maximize route efficiency, saving drivers time, money, fuel, while reducing CO2 emissions.

The automotive and transport industry is becoming more exciting with the rapid acceleration of available EVs even in the local market. EVs are no longer a curiosity. It is becoming a necessity, one that is simple, easy, and efficient. We will be more engaged in making informed decisions when it comes to driving or choosing the right mode of transport to meet our needs. Here's to an electrifying future ahead!