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Electric vehicles disrupting the mobility industry


Gone are the days of cash incentives for electric vehicles (EVs). Manufacturers are doing just fine on their own, thank you.

Global sales of EVs hit 1.2 million in 2017 and are expected to reach 1.6 million by the end of this year. By 2019, that number is expected to climb to 2 million. The news comes from Frost & Sullivan’s recently published Global Electric Vehicle Market Outlook 2018. China is leading the market with 48% market share, followed by Europe with 26%.

According to the report, 11 automakers have announced future EV launch plans in the last 6 months. Based on the announcements, this means the market potential could reach 25 million EVs sold by 2025, or 20% of all cars sold.


The challenges

The report flags issues the industry must address, such as battery technology and charging infrastructure, in order to keep pace with EV sales.

Developments in low-cost, fast-charging battery technologies that support long range are delivering promising results. Last year, car manufacturers targeted battery capacities of over 60 kWh that improved EV range up to 200 miles on a single charge. Solid-state batteries are emerging as the answer, proving to be safer and possessing over double the energy density of lithium ion batteries.

Car manufacturers such as BMW and Toyota are expected to be among the first to adopt the new batteries in their electric vehicles by 2023.

However, the cost of lithium ion batteries is falling, with prices dropping below $200 KWH for a battery pack. According to Frost & Sullivan, this could push sales of luxury EVs even more as they begin to become more competitive with their fossil-fuel-powered counterparts in price. Manufacturers of lithium ion batteries will need to get a head start on battery technology as new entrants in the market are exploring integrating technologies, such as mobile phones.


What about charging stations?

Charging stations are proving to be more problematic. Currently, there are 90,000 stations globally, with 30,000 more expected in 2018. A problem highlighted by the research: charging stations tend to be located in areas where EV sales are strongest. For the market to expand further, this has to change. However, the research speculates that this problem is on the verge of transforming.

The report also states that energy and petrochemical companies have started investing heavily in establishing electric vehicle charging stations. Shell acquired The New Motion in the Netherlands, the largest infrastructure operator which owns a network of 30,000 charging stations.

But the issue isn’t merely about bumping up the number of charging stations. The charging technology itself needs to improve. According to Forbes, the next technological wave will be ultra-fast charging and inductive charging. “Several premium car manufacturers including Audi, BMW, Daimler, and Porsche have stated their objective to introduce 250kW+ ultra-fast charging systems as they bid to compete with Tesla’s proprietary super-charging system.”


Where logistics companies stand

Companies that include DHL, DPD, and TNT, plan to switch their conventional vehicles to a 100% electric fleet with vehicles that are just as competent. By 2020, OEMs will shift to 100% electric vans.

More manufacturers announce plans for EVs

Right now, 165 EV models are available around the world. Based on the plans of major auto makers, a total of 400 models are expected to enter the market by 2025:

  • Porsche aims to make 50% of its cars electric by 2023
  • JLR will shift entirely towards electric and hybrid vehicles by 2020
  • General Motors, Toyota and Volvo have declared a target of 1 million in EV sales by 2025
  • Aston Martin expects that EVs will account for 25% of its sales by 2030, with the rest of its range comprising hybrids
  • BMW plans to offer 25 electrified vehicles, of which 12 will be 100% electric
  • The Renault Nissan & Mitsubishi partnership plans to introduce 12 new EVs by 2022


The biggest market for EVs

That title belongs to China, with a 50% market share, equating to over 600,000 EVs sold in 2017. China dwarfs the U.S. in comparison, with total sales of 200,000 units sold. China is expected to retain their leadership position for the next 5 to 7 years. For this reason, EV manufacturers around the world are analysing partnership opportunities in China.


What’s next?

Moving forward, manufacturers will be cannibalising their revenue from traditional fuel-powered cars. Opportunities will exist in new mobility services, such as charging infrastructure companies and battery makers. What’s needed is a common standard for EV charging and a deeper alliance between car manufacturers and suppliers to develop technological advances and economies of scale.

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