The Daimler EV strategy trumps BMW

The Daimler EV strategy trumps BMW

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By unpacking press statements from the world’s top luxury carmakers, BMW and Daimler, over the last eight months it is clear that the Daimler EV strategy will trump that of BMW over the next decade. Up to now, BMW has led the race between the two companies in the EV sector, but the German automaker is failing to capitalize on its position. BMW was first to market with a pure electric vehicle, the BMW i3, which success even surprised itself. This week BMW released its sales data for the first quarter 2017, showing that EVs now constitute 3% of its total sales as EV sales jumped 50%. The Chairman of the Board, Mr. Harald Kruger was quoted saying “We are therefore well on course to delivering more than 100,000 electrified vehicles for the first time in 2017”. The news from the top seems very bullish on face-value but therein lies the problem. BMWs management has been flip-flopping on finding a consensus view on where they see electric vehicles in the future. This week’s news from BMW is in stark contrast from news only six months earlier when the Board grappled with if it should pursue EVs at all.

In September 2016 Reuters reported that the executive of BMW would not attend the 2016 Paris Auto Show as it grappled with its electric car strategy. At the time the company lost momentum against Mercedes and VW who is chasing Tesla. The lack of momentum caused the head of the BMW i8 project to jump ship to Future Mobility, taking most of the core team with him. The executive team remained split on the future of electric vehicles and investing in what is initially a loss making exercise. The top executive team traditionally attend the Paris Auto Show, which is one of the most prestigious events in the industry, highlighting the significance of the board’s action.

The pro-EV block prevailed but despite BMW reaffirming its strategy to pursue the development of electric vehicles the company remained downbeat on the sector. BMW’s Chief Financial Officer, Frederick Eichner, was quoted by Bloomberg saying “We’ve learned that people aren’t prepared to pay a higher price for an electric vehicle. I don’t see some kind of disruptive element coming from electric cars that would prompt sales to go up quickly in the next five to six years.” So its seems that BMW changed its wait-and-see approach to a go-it-slow approach and remained cautious when it came to investing aggressively in the new technology. Where at first the company was a leader in developing the new proprietary technology it now joined most of the other laggards in producing PHEV variants of existing models, with no clarity on when BEV models will be available and how many.

In early March 2017, Mr. Harald Krüger was quoted by Reuters as saying “The fully electric drivetrain will be integrated into our core brands. To achieve this, we are now gearing our architectures toward combustion engines and pure battery electric drivetrains,” as the company plans to include EV manufacturing in its mass production line. Currently, the company’s electric vehicles are assembled at its low-volume plant in Leipzig. BMW will also expand the capacity of its PHEV drivetrain plant in Thailand and fund the cost of the investment in its electric vehicle infrastructure through a production increase in its profitable SUV segment. To ramp up production to meet expected demand for the new Mini Countryman PHEV the company is considering manufacturing facilities for the Mini in Germany, the Netherlands, and the UK. The company also announced that it would start producing its iNext autonomous brand at its Dingolfing plant form 2021. Other models expected from the German automaker is the i8 Roadster PHEV (2018), a BEV Mini (2019), and a BEV X3 (2020). BMW‘s long-term electric vehicle strategy is to have EV’s contribute to between 15% and 25% of its sales by 2025.

Daimler, on the other hand, had the foresight at the start of the cycle to be an early investor in Tesla. The company invested $50 million in the Series E round in May 2009, and have been hailed by Elon Musk for saving the company from bankruptcy in the early years. Unfortunately, Daimler failed to follow the same daring approach it invested in in its own business model and fell behind BMW and Tesla.

Daimler’s passive stance changed in July 2016 when its CEO, Dieter Zetsche acknowledged the technology’s importance and expected an increase in EVs market share of the total vehicle market. The German automaker shifted its strategy to accelerate its efforts to stay abreast of its competitors, Tesla and BMW‘s push to ramp up production in the luxury electric vehicle segment. Within a short space of time, the company announced a massive $11Bln investment to support its electric vehicle strategy up to 2025, unveiled its new all-electric car brand, the EQ (Electric Intelligence) and unveiled a fully electric semi-truck. The EQ brand will develop a host of EV related services and products, not just cars, such as charging stations and battery packs. The first vehicle to come from the brand is targeted at the highly popular SUV segment, a clever move to differentiate the brand in this hotly contested sector. The EQ SUV is said to have a battery capacity of 70kWh providing a range of over 250miles powering two electric motors providing 300kW of power. The production version is expected to be launched in 2018.

In early April 2017 Daimler announced that it would accelerate its $11 billion investment in electric vehicles by bringing it forward with three years from 2025, to 2022. Reuters reported that the automaker’s aggressive stance are the result of it not being able to cut fleet emissions of 123gm CO2/km from 2015 to 2016 in Europe. Europe has set a very stringent target of 95gm CO2/km by 2020. Daimler’s own target for 2020 is 100gm CO2. The German automaker cites the popularity of SUV’s as the reason for it not cutting its emissions for the first time since 2007. Daimler’s success in the SUV segment helped it to regain its dominance over archrival BMW for the first time since 2005.

In May 2017 Automotive News interviewed Mercedes-Benz head of production and supply chain management, Markus Schaefer.  When asked how the company is preparing to assemble the EQ brand Mr. Schaefer responded – “We believe the EQ family will represent 15 to 25 percent of our sales in 2025, but at the end of the day, no one can say with certainty how high the share will be. Therefore, we need maximum flexibility, meaning we will integrate the EQ models into the same assembly line as the combustion engine models they will potentially replace. Preparations are on schedule, so our plants should be capable of operating at stable output levels whatever the EV take rates may be. But in order to facilitate this greater flexibility, we also had to adapt our manufacturing.” The capacity to mass produce EVs efficiently through the full-flex plant manufacturing strategy is set to help the company recover the massive investment it will make to get ahead in the EV sector.

Daimler is also investing heavily in charging infrastructure in Europe to facilitate the adoption of electric vehicles. The final proof of Daimler’s strategy will be the early release of a full electric SUV. 2018 is certainly going to be an exciting year for the electric vehicle market.

daimler ev strategy

Note to data: The BMW i3 is listed as a BEV but includes sales for the BMW i3REx, a range-extended vehicle, a PHEV.

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Mini could be the BMW mass-market electric car

Mini could be the BMW mass-market electric car

BMW is shedding some lite on its short-term electric vehicle strategy, according to Reuters, citing CEO Harald Krüger. The German automaker hinted that the Mini could be the BMW mass-market electric car, competing with the Tesla Model 3 and Chevrolet Bolt, as the company targets over 100,000 EV sales for 2017, up from 62,000 in 2016.

BMW is releasing the Mini brand’s first electric vehicle mid-2017. The Mini Cooper Countryman S E All4, available at dealers in Europe from 24 June 2017. Mini’s first attempt, the Mini E, was produced in a limited amount and only used for field trials in 2010.

Mr. Harald Krüger was quoted as saying “The fully electric drivetrain will be integrated into our core brands. To achieve this, we are now gearing our architectures toward combustion engines and pure battery electric drivetrains,” as the company plans to include EV manufacturing in its mass production line. Currently, the company’s electric vehicles are assembled at its low-volume plant in Leipzig. BMW will also expand the capacity of its PHEV drivetrain plant in Thailand and fund the cost of the investment in its electric vehicle infrastructure through a production increase in its profitable SUV segment. To ramp up production to meet expected demand the company is considering manufacturing facilities for the Mini in Germany, the Netherlands, and the UK.

BMW‘s long-term electric vehicle strategy is to have EV’s contribute to between 15% and 25% of its sales by 2025.

Disruption draws world’s richest to the auto sector

Disruption draws world’s richest to the auto sector

The barriers to entry into auto manufacturing became ever higher over the last 100 years before the disruption caused by technological advances in electric vehicles and self-driving technology. Most of the auto brands that were around at the turn of the century have been around for 50 years or longer; the only newcomers was a spate of Chinese brands backed by the government. For an individual to reach the top 50 position on the Forbes list from vehicle manufacturing was only possible if your parents left you a trust fund with a bunch of 100-year-old stock in a big brand. In fact, the only Forbes Top 50 billionaire from the auto sector was the German’s, Herbert and Johanna Quandt who owned nearly 50% of BMW and Georg Schaeffler (Number 39 on Forbes 2016 list) who inherited the automotive parts company, Schaeffler Group. After their passing of Johanna Quandt, the children, Susanne Klatten (Number 38) and her brother Stefan Quandt (Number 48), became the beneficiaries. Mrs. Klatten invested her fortune in pharmaceuticals, helping her to gain over her brother.

Come to the turn of the century and along came Elon Musk, risking it all on a technology that has been shunned for 100 years by big auto. Being a start-up in a market controlled by a couple of dinosaurs was not easy at first, Mr. Musk had to back himself in the first couple of rounds of fundraising for the electric vehicle company, Tesla. The table below shows that Elon Musk pretty much up until late 2008 lead fundraising and loan rounds. The risk paid off as Elon Musk became by far the richest person in the US auto sector and at the time of going to press Elon Musk jumped to the 83rd position, up from 94 in the official 2016 Forbes list of the world’s richest people.

Source: Crunchbase
Date Amount $M Round Lead Investor Investors
May, 2016 1,460.0 Post Ipo Equity 5
Oct, 2012 10.0 Grant California Energy Commission 1
Nov, 2010 30.0 Post Ipo Equity Panasonic 1
May, 2010 50.0 Post Ipo Equity Toyota Motor Corporation 1
Sep, 2009 82.5 Series F Al Wahada Capital Investment 4
Jun, 2009 465.0 Debt Financing US Department of Energy 1
May, 2009 50.0 Series E Daimler 2
Nov, 2008 40.0 Debt Financing Elon Musk 5
May, 2008 40.2 Debt Financing Elon Musk 5
Feb, 2008 40.0 Series E Elon Musk 8
May, 2007 45.0 Series D Elon Musk, Technology Venture Partners US 10
May, 2006 40.0 Series C Elon Musk, VantagePoint Capital Partners 11
Feb, 2005 13.0 Series B Elon Musk, Valor Equity Partners 3
Apr, 2004 7.5 Series A Elon Musk 2

Other early billionaires in the technology include the savvy investor Warren Buffet and Vincent Bollore. Warren Buffet, the world’s 3rd richest individual through his Berkshire Hathaway, controlled company, Mid-American Energy Holdings in 2008 bought 10% in BYD, a Chinese battery company, now the world’s largest electric vehicle manufacturer. The Investment at the time was $230m. Berkshire Hathaway is also a significant minority shareholder in GM.

Vincent Bollore, France’s 10th-richest person with an estimated personal fortune of $6 billion dollars, started manufacturing batteries in his company Bollore Blue Solutions. The firm, situated in Brittany province, who’s batteries are cheaper than lithium-ion cells used in other electric cars, allows it to hold down the cost of his small vehicles.

Suddenly investing in electric vehicles became sexy. Chinese billionaires, mostly from the technology sector, were the first to climb into the auto sector, some more successful than others. The Chinese electric vehicle boom is fuelled by government incentives targeting that 8% of all new vehicles should be EV’s by 2018.

The tech billionaire and founder of BitAuto, an online vehicle sales platform, William Li started the Shanghai-based NextEV.  The company raised $500M of an expected $1Bln already, sporting shareholders such as Tencent, who is also invested in Future Mobility, Hillhouse Capital, who also invested in UBER,  Sequoia Capital and Joy Capital. The company invested C¥3Bln in Nanjing High-Performance Motor Plant to produce 280,000 electric vehicles per year. NextEv also signed a partnership with one of the largest Chinese auto companies, JAC Auto which will see them share technology, manufacturing, supply chain, marketing, and capital.

Tencent mentioned above is owned by the world’s 46th richest person, Ma Huateng of China, also know as Pony Ma. Tencent, which applications include the popular WeChat app, aims to leverage its tech experience in a world where connectivity and the Internet of Vehicles will drive the auto industry. The development of electric vehicle technology provides a perfect platform for tech and vehicles to meet. To this end, Tencent created a company Future Mobility and targeted an autonomous vehicle by 2020.

The Chinese billionaire, Jia Yueting, founder of LeEco which owns LeTV, the Netflix of China invested in two electric vehicle companies, LeEco, which developed the acclaimed LeSee concept vehicle and Faraday Future, developer of the disastrous FF91, unveiled at the 2017 CES. Both businesses are known for making bold statements and big ticket announcements just to be followed by press reports of cash flow and funding problems.

The Chinese internet giant, Alibaba, owned and founded by Jack Ma who is 33rd on the 2016 Forbes list, invested $160M in a fund where it partnered with SAIC, one of the largest Auto manufacturers in the China to develop internet connected cars. The first car to come from the partnership is the Roewe OS RX5, where OS stand for Operating System and using SAIC’s luxury brand Roewe as a platform. The software runs on Alibaba’s YunOS operating system. Jack Ma unveiled the car in July 2016. The Alibaba Connected Car will have its own Internet ID, not needing WiFi or GPS services, enabling it to connect and identify drivers wattev2buy alibaba os rx5 internet carthrough their smartphones and wearables. The RX5 has four cameras providing it 360° vision and is voice controlled. The vehicle’s starting price is around $15,000 or C¥100,000.

Alibaba beat other carmakers and tech companies to the finish line with the 2016 release of the RX5. In 2015 Toyota invested $1 billion in artificial intelligence research, while Apple invested $1 billion in Chinese ride-hailing app, Didi Chixing. BMW went into partnership with technology firms Mobileye and Intel, providing the automaker with operating systems and driving assistance software while Kia and Google partnered around the search engine’s Android Auto operating system.

Robin Li, number 90 on Forbes List and owner of Chinese search engine Baidu, partnered with chipmaker Nvidia in September 2016 to develop a computing platform for self-driving cars. Baidu recently received approval from the Californian Department of Motor Vehicles to test autonomous vehicles, in Googles back yard. Baidu also partnered with BMW on creating an autonomous car.

Now that the floodgates are open, billionaires from around the world are looking to enter the electric vehicle and self-driving sectors. The world’s fourth richest man, Carlos Slim of Mexico, announced this early this year that he would back the development of a Mexican-produced electric vehicle through his company, Giant Motors in a joint venture with Grupo Bimbo, the world’s largest bread maker. The strategy plays off in an environment where many US based automakers are contemplating bringing production back to the USA amidst President Trumps America First policy environment. Mr. Slim said the electric vehicle would be designed specifically for Mexican conditions.

Bloomberg reported that the JSW Group’s owner and Chairman and India’s 19th richest man, Sajjan Jindal, announced in Davos, Switzerland his intention to enter the Indian Electric Vehicle market by 2020. The metals tycoon expects the Indian government, like many other governments, will promote EVs once it’s more affordable. 

It is clear that some of these businessmen are purely opportunistic, targeting to profit from regulation and subsidies for the promotion of electric vehicles.The majority, however, leverages their passions to bring better and more advanced options to the consumer at a much faster pace than what big auto ever moved in the last 50 years.

Although not mutually inclusive to electric vehicles, self-driving cars, deployable on combustion vehicles also, will drive the second phase of disruption in the auto sector over the next ten years. Self-driving car’s poster child is Google, owned by the 12th and 13th richest individuals in the world, Larry Page, and Sergey Brin. The company started testing it’s quirky autonomous vehicle as far back as 2009. Google recently spun the project into a standalone brand, named Waymo, meaning “a new way forward.” The company aims to partner with vehicle manufacturers instead of developing its own car. The first of such efforts was the conversion of 100 Chrysler Pacifica’s Plug-in Hybrid vehicles. Google, in many’s eyes, has lost the lead to Tesla, who’s progression was much faster and already has active Level 2 autonomy available in its production vehicles.

It will be interesting to compare the Forbes list of wealthy individuals ten years from now to one at the start of the century; we expect much more fresh faces who made their money from disrupting the auto sector. As a footnote, the lesson learned time and time again by dinosaurs in an industry are that they become too big, arrogant and slow, creating opportunities for new hungry entrants.

Picture: Source www.technewstoday.com

A summary of autonomous vehicle testing in 2016 on California’s public roads

A summary of autonomous vehicle testing in 2016 on California’s public roads

The race for self-driving cars began in all earnest in 2015 with Tesla aggressively leading the pack at the end of 2016. Tesla’s CEO, Elon Musk, is of the opinion that current hardware is already sufficient to allow Level 5 automation (full automation) as set by SAE International, an engineering association. KPMG in its 2017 Global Automotive Executive Outlook found that 37% of auto executives rated the self-driving trend as extremely important. The initial front-runner for the technology, Google Auto (now Waymo) has changed strategy from developing a car to developing systems and rather partnering with automakers than building its own car. Other than Tesla, who develop and test on the go with incremental software upgrades. Google and most other contenders are developing solutions in closed environments while being permitted to test on public roads in States such as California, Michigan, and Illinois. By late 2016 a total of 20 companies has received permits from the California Department of Motor Vehicles (CA DMV).

According to the regulations, each permit holder must annually file a disengagement report, reflecting the number of events where a driver essentially has to take over from the vehicle’s autonomous mode to either prevent a traffic incident or where the system fails. These submissions allow the public who is interested what is happening in the automaker’s self-driving test some insights, outside from what the marketing departments feed the media. Although a total of 20 permits have been granted by the end of 2016, only ten companies have conducted public tests or filed reports for the period. Here follows a summary of the reports filed by the various companies for their testing on Califonia’s public roads for the period December 2015 to November 2016. For comparison purposes, we converted the result to indicate the amount of disengagements per 1,000 miles, a measurement used by Waymo in a recent post by its Head of Self-Driving Technology, Dmitri Dolgov.

Comparing disengagement results per 1,000 miles above shows, bar Tesla’s customers who have clocked over 300 million miles on Autopilot (Level 2 Automation) as at November 2016, it is clear that Waymo is aggressively accelerating its learning and showing the results for it compared to the other brands with projects on Californian roads. One must, however, take into consideration that comparing the different disengagement reports is not truly comparing apples to apples. Ford’s testing, for instance, was only on the stretch of Interstate 10 between Los Angeles and Arizona. The companies also have different strategies. Tesla aims to have level 5 automation as soon as possible while companies such as Ford aims to have autonomous vehicles for ride-hailing and sharing services only from 2021 onwards, influencing the difficulty grade of testing. To further try and unravel each company’s testing program we delve deeper into their submitted reports below.

 READ THE BLOG FOR A COMPLETE BREAKDOWN OF DISENGAMENTS REPORTS

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The BMW i3 REx driving report

The BMW i3 REx driving report

wattEV2Buy’s BMW i3 Driving Report – The Good, the Bad and the Awesome.

Driving the BMW i3 REx was everything and more of what I expected from a luxury EV. It is slightly more challenging to write a test report for the BMW i3 because it can’t be directly compared to a combustion vehicle. For instance, if you evaluate for luxuries such as keyless entry you must take into consideration that it would use energy from the battery, and therefore most probably excluded from the design. One can pick up many little design tweaks’ to save weight and energy in the i3. I wrote a lot about the power, speed, and handling of the BMW i3 in my previous articles on the i3 and would therefore not delve into it in this BMW i3 Driving Report, but just focus on comforts and pains.

The Good

  • A spacious interior feeling, especially from the driver’s perspective. There is a meter or more’s space between the driver’s position and the windscreen, adding to the comfort of the vehicle.
  • A tight turning circle. The big front-cabin gives you the illusion of driving a long nosed sedan making the tight turning circle even more surprising.
  • The high driving position allows you to cope with the traffic on our SUV filled roads.
  • Run-flat tires, which for some is not a positive. On other BMW models, such as the 3 series you find steering with run-flats difficult, but not in the case of i3. I suspect the reason being the large wheels, which are deceptive as they are biscuit like. The large wheels add to the appealing design of the i3.

The Bad

  • Your selected drive setting needs to be reset on every new trip. It will have been much more efficient if the vehicle remembers your preferred drive setting.
  • Although the doors are mega cool, they are unpractical when two people need to enter the vehicle when you are parked next to another vehicle.
  • Since the vehicle is rear wheel drive it has limited boot space at the back and unlike the Tesla where you can fit a surfboard in the car the BMW i3 does not compensate by providing front storage. The small storage space that is available is used to store the charging cables.
  • Which brings me to the charging cables, which could be stored much neater through some clever design than having to try and fold it every time you recharge the car.
  • For all the technology in the vehicle, a rear camera would have been a worthy addition.
  • The position of the gear selector is very cool, placed as a lever on the steering column. The negative about it is that it is difficult to view your gear selection, which BMW could quite easily have presented on the main console.

The Awesome

  • The use of carbon much of the vehicle’s interior and structure.
  • Lots of visibility, the illusion is created that the roof floats on a wall of glass.

I can conclude that if I look past the cost of the vehicle and that much of the functionality related to operating an electric vehicle such as the fast charger and home charging system are not included in the price, I would seriously consider the BMW i3 REx as my next vehicle. The BMW Plug-In Hybrid EV is most properly the best first step for any person that would like to cross over to electric vehicles. For me the biggest plus is just the fact that BMW actually has a true EV product available in most markets, making it a member of a very elite bunch.

Wynand Goosen

Wynand Goosen

Contributor

Wynand studied his MBA in San Francisco where he was exposed to the fields of Service Science, Gamification, and Renewables, which he combined to create wattEV2buy and the award winning web app Ekoguru. Wynand is an energy storage expert and has modeled, designed and presented various solutions utilizing lithium-ion and other electrochemical technologies. In his spare time, Wynand is the author of a children’s book series and started a new project called “Career 180”.

Improving range and life of your EV battery pack

Improving range and life of your EV battery pack

Changing your driving style to improve the range of your Electric Vehicle and other battery management tips.

As promised in the blog “My first date with an Electric Vehicle (EV)” I will give a few pointers on efficient driving and battery management to increase range and battery life.

There is nothing more satisfying than leaving home with a range of 150 miles (240km) available, arriving at work 50 minutes later and 35km further with the available range still being the same as when you left. How is this possible you might ask? Well, it is a combination of the engineering and adapting your driving style to suit the battery system. On the engineering front, the reactive braking system charges the battery when you take your foot off the accelerator or when braking. It takes about a day to get used to this style of driving, but once you have mastered the art of anticipating the stop-start traffic you can add (or save) about 15% on the range available from your battery (figures based on my own experience). Not only do you charge your battery during reactive breaking, the engine also serves as a brake instead of you having to use the braking system. All in all the past week’s experience proved to me that an EV is the perfect vehicle for someone who spends a lot of time in traffic.

Changing one’s driving style to suit the battery system is slightly more difficult for most of us. EV’s certainly punishes aggressive driving styles, you can literarily see your battery being drained when accelerating, which is a pity. There is nothing more fun than leaving all the gas-guzzlers in your wake, especially on the pull-away at a robot. To really understand the power of an EV at a pull-away you just have to Google for YouTube clips “Tesla vs. …“ to see how a whole host of supercars struggles against an EV. My favorite is the 2016 Tesla Model X against the 2017 Bentley Bentayga. Make sure to watch the clip to the end. The BMW ConnectedDrive app certainly helps you to change your habits by informing you how efficiently you have completed each trip. My best was 82% and, dare I say it, my worst was 16%.

Here are some pointers on how changing your driving style will increase your range and improve battery life.

  1. Don’t cut corners. A recent study by MIT and the University of Birmingham concluded that taking shortcuts is ineffective. Not only does it add 5 to 8 minutes in your own driving time it also adds to congestion which increases driving time during rush hour on average with 33% for all commuters.
  2. Stick to the Highway. EV’s prefer smooth driving conditions. Stop-start driving, accelerating and driving up hills obviously take more out of your battery.
  3. Use your car comforts sparingly. Heating and cooling drains battery power, I experienced a 15% decrease in range by just changing the heating from 21 °C to 28 °C. Higher end technically spec’d vehicles like the BMW i3 enables you to set your departure time, allowing the cabin to be heated while still on charge. Most EV’s also comes with different drive settings, whereby for instance the heating system could be disabled.
  4. Temperature has an effect on battery discharge. Excessive heat or cold will influence battery life. Lithium-Ion batteries prefer charging and operating in cool temperatures. Normal lab testing and benchmarking is done at around 25 degrees Celsius (77 degrees Fahrenheit). Battery operation above or below the laboratory conditions will differ from the manufacturer’s stated range. Apart from changing your driving times away from the midday heat or morning cold, which is not practical in most cases, there is nothing you can do here except to take note that temperature will impact your range. Some EV’s include liquid cooling to protect the battery pack.
  5. State of Charge (SOC) is a big influence on the battery’s life. A battery should not be charged to full and does not like to be at 100% SOC for longer than an hour or two. You will get the most out of your battery pack by keeping the SOC between 30% and 80%.

Although its sounds restrictive but in reality driving style has a bigger impact on a gas-guzzler from a financial perspective. Apart from the fuel cost, parts need to be serviced and replaced much more frequently than that of EV’s. In the end, it’s all just a mindset change of which you will reap the benefits of both the value of the battery and charging cost.

Wynand Goosen

Wynand Goosen

Contributor

Wynand studied his MBA in San Francisco where he was exposed to the fields of Service Science, Gamification, and Renewables, which he combined to create wattEV2buy and the award winning web app Ekoguru. Wynand is an energy storage expert and has modeled, designed and presented various solutions utilizing lithium-ion and other electrochemical technologies. In his spare time, Wynand is the author of a children’s book series and started a new project called “Career 180”.

Range Anxiety? What’s that?

Range Anxiety? What’s that?

I am glad to report that range anxiety is only a short-term infliction for a novice EV driver. It took only two days to overcome the fear, which I realize know is born out of ignorance or a lack of experience. I feel so confident now that I am even prepared to take up a challenge to drive the 1400km to Johannesburg, which I estimate could be done in two days.

Granted, I am driving a BMW i3 REx, which can be classified as a plug-in hybrid (PHEV), giving you that added a sense of security. Over the last four days, I have only used the combustion motor on the first day to maintain the battery’s charge level, more our of fear than necessity. In fact, the American Environmental Protection Agency (EPA) devised a measurement, called a utility factor to compare how different PHEV’s are used. The utility factor is a projection of the share of miles that will be driven using electricity by an average driver in full electric or blended modes for PHEV’s. The Toyota Prius, for instance, has a utility factor of only 29%, while the Chevy Volt has a utility factor of 66%. The BMW i3 REx has a utility factor of 83%, supporting my experience.

Naysayers will try and detract potential or novice EV drivers by stating that an emerging market like South Africa does not have the necessary infrastructure of charging stations to support the adoption of EV’s. I was shocked that the sales manager of one of the large luxury brands used this argument on me today when I tried to find out what EV’s of PHEV’s they have locally. He argued his brand only supplied the best technological solutions. Really? Not a good claim to make if the only PHEV in the parking area was that of your competitor. I sometimes wonder why people, in general, depend on the word of a sales representative to make crucial buying decisions. This manager knew nothing about EV’s but he was prepared to take a position against it and most buyers would have based their decision purely on his knowledge. I digress. Granted, we do not have the fast charging network to support long distance traveling, but as mentioned in my post on range anxiety, only a few people need to travel more than 100km’s a day, at the least making the case for an EV as a second family vehicle. I found that there is no real need for charging stations to detract you from your buying decision. During this last week, I traveled 70km a day to and from work, leaving me with ample range to travel about three days in total before re-fueling. When home I plug the vehicle into my normal wall outlet overnight to recharge the +/- 10kWh I used. In any case, there is already some charging stations planned or being constructed in South Africa. A recent article estimated that globally charging stations would be a $12.6Bln industry by 2022, which would attract entrepreneurs or large corporates to provide the service locally.

Perceived high electricity rates impacting on charging cost is another favorite counter argument for EV’s. South Africans don’t like to hear that our electricity is cheap, however, compared to international standards it is still very cheap. Currently, the average base charge per kWh in Europe of 0.22 equates to R3.74 at the current exchange rate, compared to about R2.30 in Cape Town. Charging 10kWh would cost around R23, which is far less than the estimated R80 per day I spend on fuel for the same distance. WattEV2Buy provides a great tool to measure the cost of charging and comparing the cost for the different EVs and PHEV’s.

Another favorite argument by naysayers is that an EV’s battery pack only last for a couple of years and a replacing a pack are expensive. Most EV manufacturers currently provide an 8 year / 150000km warranty of the battery pack. Eight years is a very long time in the life of any technology. Added to which, if one take into consideration the huge increase in lithium-ion manufacturing capacity over the next three years, you can expect big price decreases in the kWh price of batteries. Just in the last year lithium-ion battery, cell cost decreased from above $600/kWh to $145/kWh negotiated for the Chevrolet Bolt battery pack from LG-Chem. Furthermore, a couple of business plans already exist for the second live of EV batteries as stationary solutions for grid or battery home systems. Both Nissan and BMW have already announced efforts to create second life products, giving some value to the battery pack when it needs replacement. Internationally efforts are also afoot to utilize EV batteries as part of the smart grid, providing EV users an income from their batteries for being a demand response asset when charging or even as backup power for one’s own home. There are even some manufacturers that lease the battery, so you would only buy the “shell” of the vehicle, Citroen and Renault provide this service. Some critique to this business model is that some drivers are skeptical that the vehicle could be disabled should they miss a payment.

I can honesty say that for me, apart from price there is no real argument for not switching to an EV or PHEV at the least. Elon Musk has done humanity a big favor by bringing EV adoption forward. It forced all the large manufacturers to review their EV strategies. Up to 2014, there was still widespread skepticism on the future of EV’s. If one review the vehicle manufacturers strategies in 2016 as summarized on wattEV2buy, it is clear that most have changed course for PHEV’s and EV’s. Now the majority of big auto brands have a planned product mix of around 50% PHEV’s and EV’s by 2020.

There is only limited time left to classify yourself as an early adopter, within two years the decision to buy an EV would be mainstream and promoted by the marketing departments of all automakers.

In the next blog we look at how to get the most out of your EV’s battery and extending range.

Wynand Goosen

Wynand Goosen

Contributor

Wynand studied his MBA in San Francisco where he was exposed to the fields of Service Science, Gamification and Renewables, which he combined to create wattEV2buy and the award winning web app Ekoguru. Wynand is a energy storage expert and has modeled, designed and presented various solutions utilizing lithium-ion and other electrochemical technologies. In his spare time Wynand is the author of a children’s book series and started a new project called “Career 180”.

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