Electric vehicles (EVs) no longer belong to a niche market. Labelled as the vehicle of the future, it is a car that is not only environmentally friendly, but also stylish, reliable and growing in popularity. Based on today’s statistics, China leads European and US markets, with countries such as Norway and the Netherlands taking further action to phase out all fossil-fuel cars by 2025. By the end of 2016, the number of plug-in EVs on the world’s road is set to surpass 2 million.
Sales of New Electric Cars as % of New Registrations
Developing a Global Support Framework
Of course, EVs surge in popularity has not been smooth sailing. One obstacle that automakers still need to overcome is EVs high price tag. Across the industry, the price of an electrified car is more expensive than an average suburban family vehicle. The difference is several thousands of dollars and this is largely due to the cost associated with designing the electric model and the cost of the car’s battery.
Supporting the uptake and adoption of EVs is also evidently hindered by consumer concern surrounding the availability of charging stations and the time that it takes to charge EV batteries. Most countries do not have the infrastructure to charge mass volumes of battery powered cars and reports suggest there aren’t many companies actively looking to produce such equipment on a mass scale either.
In order to achieve widespread adoption, the government will need to offer worthwhile incentives to consumers and companies alike. It is the government's responsibility to present EVs as a sensible investment, as demonstrated by Israel which currently offers tax breaks to those all buyers who purchase EVs.
There is enormous potential for police cars and multiple vehicles to convert to electric, a move that would place additional pressure on establishments to acquire the necessary infrastructure to sustain the EV maintenance market. Many countries support this theory and are now translating thought into action. In 2015, the UK government announced that it will spend more than £600 million between 2015 and 2020 to “support the uptake and manufacturing of ultra-low-emission vehicles”, including £38 million to be spent on public charging points.
Companies across the transport sector also need to align their business objectives with the movement. Earlier this year, Go Ultra Low created the ‘Go Ultra Low Companies’ initiative, to identify and reward public and private sector organisations that offer EVs to employees as company vehicles.
Poppy Welch, Head of Go Ultra Low, comments: “As an industry, it is our collective responsibility to give businesses confidence to be bold and realise the multiple benefits that plug-in hybrid and pure electric cars can bring, including cost savings and a carbon footprint reduction.”
Corporate giants such as future focused Uber, the world’s largest app based taxi hailing service are driving the cause and looking to add more EVs to its London service.
Jo Bertram, regional general manager of Uber in the UK, said: “People already associate Uber with hybrid cars, but we now want to go a big step further with fully electric cars on the road from today. We are determined to use technology to help tackle the challenge of air pollution in London and across the UK.”
Electrifying the Movement
At this year’s flagship Paris motor show, EVs took centre stage, with many vehicle manufacturers promising to achieve more sales, reduce manufacturing costs and achieve optimal economies of scale.
Mercedes-Benz was notably ambitious in its approach and has pledged to introduce advanced EVs with CEO Diamler Chief Executive claiming it will “cover all vehicle segments, from the compact to the luxury class.” Volkswagen on the other hand has vowed to deliver 30 all-electric models by 2025. In addition to this, Xindayang, a Chinese automaker, revealed it will market electric vehicles in China at a cost of $10,000 — a price considerably lower than EVs advertised elsewhere.
While the vast majority of car manufacturers know electric is driving the future, some luxury automotive makers are resisting the leap into electric. At the show, Ferrari announced it is not yet convinced that electric is the way forward.
“We would not follow to develop a fully electric car,” said Ferrari’s chief technology officer, Michael Leiters.
“We are convinced that it’s right to have a hybrid car because, for us, the sound is a very crucially important characteristic of a Ferrari, and our customers want to have this. There’s a lot to do. For us, today, the weight [of batteries] is still too much to have a highly dynamic and highly agile car.”
Ferrari’s competitors think otherwise. Fisker Inc. recently unveiled its plan of developing a high-performance battery-powered supercar. Founder and car designer Henrik Fisker said the vehicle will have “the world’s longest electric range of any production car previously developed”, with battery tech that will have capabilities that are “unlike anything used by an electric vehicle to date.”
R&D Intensity of Tesla and Selected Car Manufacturers 2015*
*R&D intensity is measured against company's investment in R&D and Revenue
War for Talent
Today, OEMs and automotive suppliers are searching for candidates who are being headhunted by tech giants Google and Apple. These same automakers also recognise talent hot spots and are beginning to inject substantial investment into relocating core operations.
Recently, Billionaire and founder of Tesla, Elon Musk announced it had acquired German engineering company Grohmann and hopes to establish a new UK base in the near future.
“We have a lot of respect for the British automotive engineering talent,” said Musk. “Just look at Formula 1 - it amazes me how much British talent there is in that. We are likely to establish a Tesla engineering group in Britain at some point in the future.”
Tesla is not alone. Many companies are re-positioning central operations to key automotive regions. Professor David Bailey, an automotive industry expert at Aston university comments: “Just as automakers go to Silicon Valley to tap into software design, so too auto firms come to the UK for design and engineering skills and technology.”
Finding the best talent across the engineering market is not an easy task and many recruitment agencies agree that additional training programs must be offered with automotive roles. "As technologies evolve and the demand for candidates increases, automotive manufacturers need to consider not only how they will attract candidates but also how they will help develop junior engineers with apprenticeship schemes," explains Chris Taylor, Associate Director at Spencer Ogden.
Chris justifies that the skill set of university level candidates should not be ignored. "With an ageing UK workforce and less people moving into these roles than ever before, it is important for EV manufacturers to re-engage at university level to encourage top level graduates to choose the automotive sector over industries like android technologies or gaming apps. EV is certainly very exciting and we are in a real era of change in electronics and power."
In recent months, Porsche launched a recruitment drive to find 1,600 qualified workers to help deliver its Mission E electric car. Dubbed as “the Porsche of tomorrow”, the firm has invested close to €1 billion into developing the Mission E, which will have significant emphasis on sport car performance, specifically range and driving dynamics.
Attracting the right candidates with a competitive salary is not enough to sustain the interest of the industry’s best talent. “One can in fact describe what is going on now as a ‘war for talents," claims Porsche human resources manager, Andreas Haffner
"We are in direct competition with other automakers and suppliers and IT firms in our global search for talented experts. Money alone is not enough to attract these creative minds.”
Prioritising battery technology research is essential for a bright EV future. Although we are still in the “early adopters” phase, 2016 has highlighted how far the industry has progressed. However, significant EV ownership uplift will only occur when automakers, companies and government institutions boost EV supply, pioneer price reductions, and drastically improve the EV infrastructure market. Until then, consumers will continue to wait for EV innovation to capture their imaginations and chequebooks.
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