Cars of the future: electric or hybrid

A seismic change in the global automotive industry is looming as the future points to mobility that is electronic, computerized, increasingly petroleum-free and zero-emission. As global warming and severe changes in weather patterns afflict the world, scientists point to manmade emissions as the main culprit and governments are imposing more stringent fuel consumption and emissions regulations. Auto manufacturers are scrambling to comply with these regulations by developing more hybrid gasoline-electric vehicles and plug-in electric vehicles (EVs) with fully autonomous cars as the holy grail in about 10 years. Massive horsepower, breakneck speed and gasoline fumes will soon be so yesterday (except, of course, in the case of dream cars like Ferrari and Lamborghini.)

 

Already, the big carmakers are deciding whether to go hybrid or fully electric.  The industry was stunned recently when the upstart Tesla Motors Inc. based in Palo Alto, California, launched the Tesla Model S, a zero-emission, all-electric luxury sedan that in performance, appearance, technology and comfort earned rave reviews from the motoring media.  The Tesla S gets as much as 265 miles (464 kilometers) before it has to be recharged, while every other EV on the market gets about 160 km of driving range or less. Twenty thousand units of the Tesla S have been sold in one year despite its $70,000 retail price, putting to shame General Motors’ Chevrolet Volt EV and the Nissan Leaf EV.  And compared to the gorgeous Tesla S, the Volt and Toyota Prius hybrid look stodgy.

 

With Tesla Motors CEO Elon Musk promising to offer within a few years a mass-market EV retailing at $35,000 with a 320-km range on a battery charge, Tesla shares soared in the stock market, then plunged 6.2 percent earlier this month when a video of a Model S burning after it hit a large metal object on the highway went viral on the Web.  But since the battery caught fire after the object punched the car’s underbody and the driver escaped from the car unhurt, Musk was able to point out how the internal firewalls and other built-in safety features proved how safe the Tesla S is, even when a collision occurs.

 

TOYOTA’S HYBRIDS. Tesla’s phenomenal success may have prompted Toyota Motor Corp. to display its global hybrids at an event outside of Detroit as part of its waku-doki (Japanese for “heart-pumping”) campaign to change the company’s practical but bland image by designing sexier-looking and faster hybrids. The world’s largest automaker has declared that it is sticking to hybrids and fuel cell vehicles for the car of the future. In Washington last Sept. 30, Toyota chair Takeshi Uchiyamada said the reason why Toyota doesn’t introduce any major all-electric vehicle is “because we do not believe there is a market to accept it.”  He added: “Some people say hybrid vehicles such as the Prius are only a bridge to the future.  But we think it could be a long bridge and a very sturdy one.  There are many more gains we can achieve with hybrids.  The Prius has become the most important vehicle for our future.”

 

Uchiyamada is often called the father of the Prius since his product development team was the one that developed the hybrid gasoline-electric vehicle. He said he isn’t concerned Toyota will be left behind if the world becomes enamored with EVs since hybrid gasoline-electric technology encompasses all the technologies required to make an EV.  Toyota has an electric version of its RAV4 compact SUV whose batteries and motor are supplied by Tesla, but Uchiyamada said the partnership with Tesla hasn’t changed Toyota’s dim view of all-electric cars. Toyota sells 22 hybrid vehicles worldwide, comprising 16 percent of its sales.  Most of these are from the Prius line, which has the highest fuel economy of any nonplug-in vehicle in the United States.  Toyota is working on the next-generation Prius and aims to improve its fuel economy by 10 percent or more.

 

ELECTRIC LEADER. Except for Ford Motor Co., which downplays EVs while prioritizing fuel economy and connected vehicle technology aside from hybrid versions of the Fusion and the C-Max station wagon to challenge the Prius, other major automakers don’t share Toyota’s outlook on EVs. While Toyota is the global leader in hybrids, the Nissan-Renault alliance headed by Carlos Ghosn is recognized as the world leader in EVs. Last August, Nissan demonstrated a prototype self-driving Nissan Leaf electric car that used laser guidance, radar sensors and cameras to navigate around a track with various obstacles in Irvine, California.  Ghosn promised that Nissan would bring affordable autonomous cars to the public by 2020.  Although the $35,000 Leaf hasn’t sold as well as expected, Nissan has five new EVs in the works to launch between now and 2016, with one of these looking sportier than the plain and practical Leaf.

 

Volkswagen AG displayed the e-Golf at the Frankfurt Auto Show last month and announced that it will go on sale in the United States in 2015 with more electrified models to come if demand increases.  Volkswagen said it intends to become the largest seller of EVs by 2018.  Responding to Tesla’s challenge, General Motors disclosed that it is developing a $30,000 EV that can go 320 km on a charge, but wouldn’t say when the car would be available.  GM’s Cadillac brand plans a plug-in hybrid model based on the technology in the Chevrolet Volt, 15,000 units of which were sold in the United States through August this year due to discounts and incentives. Daimler AG’s Mercedes-Benz brand plans to launch an electric version of its B-Class compact next year. The latest to join the EV segment is BMW, whose BMW i3 subcompact, its first mass-production electric car, will go on sale in Europe this November and in the United States in 2014 at $41,350. BMW unveiled the i8, a bigger and sportier EV more directly competing with the Tesla S, at the Frankfurt Auto Show in September.

 

EXPENSIVE BATTERIES. Tesla, GM, Nissan and Volkswagen all face the same problem: Current EV batteries are too expensive and deliver too little usable driving range compared with vehicles powered by internal combustion engines.  Toyota chair Uchiyamada underscored this when he said he thinks EVs require “two breakthroughs” on battery technology before they become viable as replacements for gasoline or hybrid-electric vehicles. Toyota’s electric RAV4, for example,  has a starting price of $49,800 or about $26,500 more than the internal combustion engine RAV4 that starts at $23,300.

 

Even Ian Robertson, BMW’s head of sales in Germany, said last July at the media launch of the i3 that mass acceptance will come when EVs cost less than 10 percent more than a conventional vehicle and can travel at least 300 km on a battery charge. Robertson placed the market for EVs at 150,000 vehicles a year.  In Europe, BMW i3 buyers who might sometimes want to drive long distances will be offered packages allowing them occasional loans of gasoline or diesel-powered BMW models.  In the United States, sales of EVs and plug-in hybrid vehicles account for less than half of 1 percent of the overall market despite price cuts, discounted leases and government tax incentives.

 

In fact, the slow growth of the EV market has forced advanced battery maker A123 Systems LLC to shift away from EVs to hybrids.  The company ran out of cash after ramping up production in 2009 when EVs were expected to rise in the US market but did not. A123 still supplies batteries to GM for its Chevrolet Spark EV, BMW AG’s 3-, 5- and 7-Series hybrids, Daimler AG’s Mercedes-Benz AMG vehicles, Fiat SpA’s Ferrari and Formula One race cars. Nonetheless, BMW AG CEO Norbert Reithofer is taking a long view on the potential of EVs.  “If you build such a car … you have to look into the future, 10, 15, 20 years.  If you look around the world, (at) the emissions regulations in the United States, in the European Union, even in China … cars like the BMW i3 are a must.”

 

Sources: The WSJ-Asia, IHT