If LEVs are to be Successful, They’ll Need to be Eye Catching

Modern day cars come in all sorts of shapes and sizes, often aimed at better suiting the desired purpose of the vehicles and other times simply to be attractive in appearance. A People Carrier tends to have a somewhat blockish exterior so that interior space can be maximised whilst a sports car is often low to the ground and streamlined to enhance performance through better aerodynamics and tyre grip. I’ve often heard some muscle cars been referred to as “aggressive” in styling, in a sense they are made to reflect their owner’s desire to command the road and, for lack of a more subtle phrase, augment his machismo.

These lessons shouldn’t be avoided by the manufacturers wishing to introduce LEVs into the automotive market. Toyota has already leaped forward with the latest version of their Prius being distinctly styled and eye catching. Toyota have realised that the customers that generally buy a hybrid car want to be seen driving a hybrid and enjoy the social symbolism that goes along with it. By ensuring that their Prius would be easily recognisable, they have created an environment where the driver of the Prius can indirectly communicate their values of environmental consideration and fuel efficiency to the rest of society.

 

The UK’s Plug-in Car Grant: 6 months on

Back in 2009 the then UK Government put into place an ambitious and well funded initiative to accelerate the adoption of plug-in vehicles. Over £400million was earmarked to advance the market from both the supply and demand side. Of this mammoth figure, £230 million alone was allocated for a consumer incentive grant that would knock off between 2 and 5 thousand pounds of the sticker price of a new plug-in vehicle. The current incumbent Government decided to support this initiative and the consumer incentive was introduced to the market at the start of this year. The timing was chosen to coincide with the introduction of EVs into the mass market so that all potential early adopters would benefit.

6 months on and we can look back and review the “success” of the grant measured by its level of uptake. As of last week the incentive grant has been allocated a total of 680 times meaning (assuming the full £5000 was allocated on each occasion) £3.4million has thus far been distributed. To me this doesn’t seem like a huge figure and (again if we assume that the sales have been evenly distributed) it only equates to an average of 113 plug-in vehicles being sold per month. Clearly this is better than nothing, but when you compare the first 6 months figures with the total budget allocated for this initiative you begin to think the UK Government was rather ambitious in their expectations for market uptake.

 

Plug-in Vehicles and Driveways

Recently I read an article in the Economist which discussed the differences between how car service stations were considered in America and Europe. According to the article, Americans tend to have a positive attitude towards them, choosing to locate them in prime central urban areas. In contrast, Europeans have a more negative opinion of service stations relegating them to out of town areas such as ring roads and shopping centres. This observation has been backed up by the downward trend in service station numbers in Europe with tens of thousands going out of business in the last decade. Supermarkets have taken up the slack to a certain degree and the combination of doing your shopping and filling up your car seems popular. It isn’t too much of a leap to envisage that Europeans would tend to value the ability to avoid service stations in the future altogether by purchasing a Plug-in vehicle more so than Americans as a result of this embedded attitude.

 

A Selection of my Favourite Car Commercials – Citroen: Alive with technology

The next instalment of my favourite car commercials is another golden oldie from the mid 2000s. To help generate interest in the new Transformer movie being released, Citroen teamed up with their production team to come up with a joint project. The output of this project was a distinctly attention grabbing short commercial where a conventional Citroen C4 transforms into a giant robot we all remember fondly from our youths. The transformer then proceeds to break dance to some catchy music displaying the (at the time) amazing visual effects people could look forward to in the movie. The main draw of this commercial is the graphic analogy of the technology embedded within a Citroen displaying it as being truly advanced whilst also generating interest for the forthcoming movie. I thought it was a truly unique collaboration and a mighty successful piece of advertising, I hope you enjoy it. 

Are we Trying to Force Electric Vehicles to be something they Aren’t?

Conventional vehicles have been with us for over 100 years and have become a cornerstone of our societies. They have been incrementally improved throughout their history and now represent one of the pinnacles of human engineering achievement. Indeed, some commentators have dubbed the car as one of mankind’s greatest accomplishments and they have without doubt assisted in the expansion of human prosperity.

Conventional vehicles are not however without their drawbacks and their benefits are reduced by their associated externalities. Electric Vehicles aim to address a number of these externalities and have regularly been referred to as a Disruptive Technological Innovation. What is a Disruptive Technology? Well, you can envisage the introduction of fuel injection into car engines as being a sustaining technological innovation that improves the performance of a technology without changing its fundamental structure. A Disruptive Technology is the opposite of this and breaks rather than alters the pre-existing mould. Disruptive Technologies push the frontier in nonconventional aspects of the product’s design such as significantly altering its architecture rather than providing incremental improvements on a primary attribute.

Should Plug-in Vehicles be bundled with Other Products and Services?

Some of the recent research emerging in the plug-in vehicle field shows that consumers tend to be the most open to consider a plug-in vehicle during times of instability in their lives. Moving house, changing job, having the first child are transition points when people tend to revaluate how they live their lives and if any fundamental changes are needed. Conversely, when people are “stuck in a grove” and are happy to have everything stay as it is then they’d be much less likely to think about altering their personal travel behaviour. These transition points do not happen very often and so its important to make them count.

Trying to get the most behavioural change for a single intervention would help to maximise the benefit of these transition points. This concept leads us nicely into considering if plug-in vehicles can be combined with other goods and services that may prove complementary. We’ve already alluded to early in this blog how plug-in vehicles can be sold in combination with an electricity tariff that may source its electricity from renewable/green generation or provide much cheaper rates during the night when the EV can be scheduled to recharge. Are there any other goods or services that can be combined with plug-in vehicles that share similar themes? I can think of a whole spectrum including combination boilers, cavity wall insulation and home compositing but there is one that, to me, stands out from the crowd.

A Selection of my Favourite Car Commercials – Golf GTi

Following on from the previous post, the next commercial from my favourites list stars the Volkswagen Golf GTi. This commercial combines the iconic scene from Singing in the Rain where Gene Kelly wanders happy down a street with the introduction of the Golf. The Golf GTi, which is iconic in its own right, was first introduced in the late 1970s and, on the surface, hasn’t changed a great deal. Indeed, there wasn’t too much that needed changing in the original car with the alterations simply bringing mild improvements on an already successful theme.  The commercial illustrates this vividly by demonstrating that small changes are all that is required to bring a time honoured car into the present day. Without further ado, I hope you enjoy the commercial.   

A Selection of my Favourite Car Commercials – Gas Powered Everything

Passenger vehicles are a huge industry across the globe account for near enough a trillion dollars of revenue per year which is set to increase in the future. Not surprisingly this level of economic activity brings with it a hefty level of competition to attract new customers by either bringing them into the market or acquiring them from competitors. Not only must automotive manufacturers make desirable products but they must also market them effectively to potential customers. 

With this level of money at stake, even increasing your market share by 1% can bring in 100s of millions of dollars of additional revenue. With this in mind the automotive industry invests heavily in advertising their products bringing in top marketing talent to come up with attention grabbing commercials. Some of these commercials that have come out over the years have been truly amazing and I’ve started to collect a few of the best on my Youtube account. Over the coming few weeks I’ll be posting my favourites for you to enjoy. Today’s instalment, keeping with the theme of this blog, is a thought provoking piece from Nissan that also pokes some fun at one of their nearest rivals, I hope you enjoy.   

What Will Consumers Think of Vehicle to Grid Technology?

The introduction of plug-in vehicles to the mass automotive market will undoubtedly make a consumer’s purchasing decision more complex. They will have to consider the virtues and vices of these new powertrain technologies and how they will fit in with their lifestyles. As if this was not complicated enough, the future introduction of an additional option related to plug-in vehicles has the possibility of leaving the general driver scratching their heads.

Vehicle-to-Grid technology allows a plug-in vehicle to communicate with the electricity grid and offer responsive services such as storing unused electricity during times of low demand with the option of releasing this stored energy back to the grid should any demand peaks occur. This service would be paid for by the utility companies offering plug-in vehicle drivers with an additional source of revenue to offset their vehicle’s high upfront costs. As more renewable energy is put onto the grid new mechanisms will need to be installed to smooth out supply of energy. Having the capability to drawn down on stored supplies generated from renewable energy would be much more effective than firing up a coal electricity plant every time there is a drop in generation.

 

Upgrade-Ready Vehicles could solve the Problem of Lock-in

Whenever I consider buying a new piece of consumer technology I am always concerned about how futureproof the item is. We’ve all envisaged worst case scenarios where we just set foot outside the store after buying our brand new phone or laptop only for a new version to be released the next day that surpasses our purchase. We don’t want to be locked into out of date technology and so the savvy among us usually research the market before buying to ensure what we buy will have some lasting power.

This paints a very black and white picture and it discounts a fundamental aspect of the consumer technology being released today. In an attempt to encourage consumer uptake of their products, manufacturers are now regularly building in upgrade potential into their latest devises. This upgrade potential may be hardware based such as where an additional stick of RAM is added to a personal computer or software based where a smart-phone is upgraded to the latest operating system. The same principle holds true for the latest personal vehicles in both the software and the hardware dimension.

 

Baby Steps or Great Leap Forward?

It seems more and more likely that Electric Vehicles are to be the future of personal automotive transport. They offer distinct advantages over Hydrogen, biofuel, CNG and LPG vehicles. The question now on everyone’s lips is how quick will the transition be? Our previous article discussed the inherent limitations in attempting to predict future markets but I want to expand on a point that wasn’t well laid out and that is the issue of consumer acceptance.

People in general are quite adverse to sudden and dramatic change in their consumption patterns. Introducing a concept, idea or product that is radically different from the conventional norm runs the risk of being greeted with hesitation and perhaps resistance. Moving from conventional internal combustion engine vehicles straight to electric vehicles will be a substantial change and require drivers to reconsider in many ways how they drive a car. This scenario is loaded with pitfalls and therefore it is unlikely there will be a mass shift from ICE to EV in consumer preferences. Indeed, it most likely would be undesirable all-round for this to be the case as EVs will undoubtedly have some teething problems that will need to be addressed.

Batteries Not Included?

If there is one universal truth that holds constant throughout the universe it is that the future will not be the same as the past. Change will happen and, as the previous post discusses, the ability to predict change is a highly desirable commodity. The market for personal vehicles currently stands at a crossroads with multiple pathways leading forward. The current overriding market model is one of personal ownership of a passenger vehicle that is bought from an automotive manufacturer and refuelled by petroleum firms. There is potential that this model will continue into the future but a number of rivals have emerged and are vying for position.

Electric Vehicle Market Predictions: Hocus Pocus or Sound Logic?

It doesn’t take long from the first mass production EVs to start hitting the streets before people start to predict where they will be in 10 years time. Professionals, academics, industry speculators and politicians have started to begin quoting likely EV market penetration rates over the next five, ten and fifteen years. Barack Obama recently stated his (and by extension, America’s) desire to have over one million plug in vehicles on US roads by 2015. Some predictions have been somewhat conservation predicting EV sales to amount to 5% of the market by 2015 whilst others predict a large expansion between 2015 and 2020 with sales rising towards 20% of the market. The range of these predictions shows the uncertainty that currently prevails in the market.  Why are these predictions so wide of each other, is it related to a variation or flaw in the methodologies used or the assumptions made? I will not pretend to have critically appraised all of the market predictions made but will talk here about how I would go about making a prediction based on reasoned and rational thinking rather than guesstimation.

To jump straight in, we know from previous research that vehicle costs are a big factor with consumers. Currently, EVs attract a price premium linked to their advanced technology making them relatively more expensive compared to their conventional counterparts. Now if we assume that conventional vehicle prices will remain constant at best or perhaps decline in the future, one way to boost the demand for EVs would be to decrease their price relatively faster. Recently, industry experts have stated that scale is not an issue with reducing the costs of producing EVs with more gain expected from technological breakthroughs. So, if we assume battery technology will advance at an increased rate in the future then this will assist EV market penetration. Similarly, if there is an increase to the purchase cost of conventional vehicles (a sales tax for instance), this will also assist EV demand. EVs currently require rare earth materials in their manufacturing with the extraction of these raw materials almost completely conducted in China. The Chinese Government has recently imposed a 90% restriction of the export of rare earth materials thus restricting the supply of a key factor of EV production to automotive firms. R&D has been switched on in an attempt to find substitutes for these materials but, if nothing economical can be found, this may prove a real barrier to mainstream market deployment of EVs.

Vehicle Innovators will embody the Pioneer Spirit

The first mass produced pure EVs will be hitting the streets in the UK over the coming months heralding the true beginning of electric personal vehicle mobility. Nissan has said that its order book in already full for all Leafs coming to the UK market until the end of this year. The total volume of EV sales, even if supply is saturated, will still be small change compared to the total market however they are expected to grow rapidly in market share over the coming few years.

The innovators in the market will play a crucial role in helping to form public opinion surrounding EVs. They will act as opinion leaders and diffuse their experiences throughout their social networks. It has been regularly put forward that these innovators will have distinct characteristics encompassing strong green views and a desire to be on the technology frontier. A dimension that has garnered less exposure is the aspect of freedom these vehicles will provide to their owners. Not freedom in the sense of being able to go wherever they please but rather liberation from oil dependency.

Can Motorsport play a Role in the Greening of Passenger Vehicle Transport?

Last weekend saw the first race of the 2011 Formula 1 season in Melbourne Australia. Sebastian Vettel stormed to a well deserved first place finish and was like always magnanimous in victory heaping praise onto his team.  A part of me cringes to consider the amount of fuel this sport consumes in a season but the shear popularity of F1 means it generates a great deal of happiness for all those barrels of oil. This season sees the return of the Kinetic Energy Recovery System (KERs for short) a form of  mild hybrid system allowing the car to preserve some of the energy lost under the ferocious decelerations these cars go through and provide a 5 second 80 horse power boost per lap for the driver to assist in overtaking.

A new contender is entering the motorsport ring this year and promises to be something we’ve never seen before. The EV Cup will hold 6 races (5 in Europe and 1 scheduled for the US) with all cars being solely fuelled by electricity. It will be split into 3 classifications which and combine a variety of formats. EV manufacturers and enthusiast will be able to bring their prototype muscle EVs to set lap times in a time trial format. The EV Cup has developed (alongside Westfield Racing) its own racing car dubbed the iRacer (see main picture) that will incorporate a boost system similar to KERs in F1 and will be open to experienced open top motorsport drivers. In sharp comparison to the other 2 classifications, the EV Cup will also see City EVs (provided by Th!nk) battle it out on the track for dominance. I believe this classification is included simply as a showcase to the public to inform them that production EVs are reality but it will be interesting to see which classification proves the most popular.

Electric Vehicles will be Risky Business

Whenever a new firm enters a market offering a distinctive innovation, their reputation is often closely linked with the success (or lack thereof) of their new product. A classic example is that of James Dyson who introduced the dual cyclone bagless vacuum cleaner. Mr Dyson was so confident that his new innovation was going to be successful that he decided to brand the product with his family name. Sources of innovation are not solely limited to entrepreneurs; established companies spend significant amounts of their revenue on research and development into new ideas. Whenever an established manufacturer considers introducing a new innovative product there is the opportunity for market success which will further strengthen then manufacturer’s brand or failure which would cause significant brand damage.

This is no less true in the automotive industry where there is a constant drive for product innovation and diversification. In some instances, these innovations are small such as the introduction of parking sensors and reactive headlights. In other situations, the innovations are fundamental to the operation of the vehicle. This will be the case with the introduction of electric driver powertrains. This market innovation has attracted startup companies establishing their brand in the EV market niche such as Tesla. The more conventional manufacturers such as Nissan, Ford and General Motors are bringing their EVs to market and will be staking a substantial chunk of their reputations on the success of these offerings.

Could Electric Vehicles Reduce Mobility?

EVs have come under intense scrutiny and criticism recently due to their re-emergence in the market. Most of the topics that have been brought up are old issues that were present in the previous false dawns of EVs. These concerns can be broadly placed into two categories:

1.       Will an EV be able to do the job of a conventional vehicle?

2.       Will an EV be able to reduce the problems of environmental impact and energy security related to personal vehicle transport?

The second category can be answered by relating to the fuel source used to power EVs and the materials and techniques used to build them. If the fuel used to generate the electricity for EVs is of similar carbon intensity the pollution is simply being exported and centralised from multiple sources on roads to rural power plants. Now this may not be an entire failure as centralisation of emissions away from urban centres does have benefits for human health. Energy security is dependent on where the fuel is sourced from and if this source is stable in both overall production and also price level.

The first category relates almost entirely to the practical functionality of an EV such as luggage capacity, performance, safety and range.  Range is a reoccurring theme for EVs and technological innovation has taken place in an attempt to overcome range anxiety. Battery technology is enjoying heavy investment levels and range extending EVs (that incorporate small ICEs to recharge the battery) could be of significant potential.

The Year of the EV – Are we getting ahead of ourselves?

2011 seems to be the year pure EVs will turn from myth into reality with the introduction of the Nissan Leaf, Citroen C-Zero and Peugeot iOn into the mass automotive market. Other manufacturers will be rolling out their EV offerings soon after with the Volkswagen e-motion, Renault Fluence and Ford Focus EV expected in 2012. Mild and Plug-in Hybrids will also be introduced with the Prius Plug-in version highly anticipated. It can be easy to view this year and the next as the years that the EV finally hit the big time but our previous article (looking at previous False Dawns) will hopefully temper some of this enthusiasm. There is still a long road ahead if EVs are to become firmly established in the market and there is an argument that we might be looking too far into the future.

I sincerely hope the long term future of the personal vehicle is electric however, this most certainly is a long term ambition and we shouldn’t blind ourselves to any short and medium term options of addressing the associated problems with conventional vehicles. Pure EVs will have an important role to play between 2025 and 2050 but before then other technologies should not be forgotten. Mild hybrids are likely to become much more integrated into the market employing energy recovery systems and plug-in hybrids could see their desirability increase dependent on the price of oil over the next decade.

With Electric Vehicles, Experience Matters

The first vehicle trials with EVs held in the UK have produced their initial results regarding user impressions of the vehicles. Not surprisingly, the users tend to have sceptical views when starting the trail but as they become better acquainted with operating the vehicles to meet their mobility needs these views tend to become more positive. This affect is not solely limited to EVs but has been demonstrated with a number of new technology introductions. Experience and information seem to be the best way to overcome fears and anxiety concerning new technologies with the former usually more effective than the latter.

So if drivers need to have experience with EVs before they will tend to view them in a positive light and consider them for their next vehicle purchase, the question is how do we provide this experience? There are a number of ways that can be considered. Firstly, with improvements in computer and virtual reality technology the application of EV simulators is a real possibility. These would allow drivers to go for a virtual journey in an EV and get an impression of how these vehicles operate. This method does have the limitation that no matter how realistic the simulation is the user will always know that it is not genuine and so will question is validity. However, a simulator may prove to be a cheap option allowing a large number of drivers to experience an EV journeys from a central location.