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DELOITTE INSIGHTS: Express Lane Ahead was recently published as an informative 25-page spiff to Automotive News, my weekly source of auto industry matters.
Here in Parts 1 and 2, today and tomorrow, are tidbits gleaned from “Tempering the Utopian Vision of the Mobility Revolution,” by Craig A. Giffi, Joseph Vitale Jr., and Ryan Robinson, one of the Deloitte articles. I also include related insights from Automotive News.
Deloitte Touche Tohmatsu is one of the “Big Four” global specialists in accounting and professional services. (The other three, if you like to keep track of such things, are Ernst & Young, KPMG, and PricewaterhouseCoopers.) Here, the Deloitte authors discuss four key trends: vehicle electrification, vehicle autonomy (AV), vehicle connectivity, and shared transportation. They begin with a key question.
Do Consumers Care? Based on the 2019 Deloitte Global Automotive Consumer Study, the authors write, “Significant challenges remain that may be overlooked by industry players so focused on developing the technology that they forget to ask whether anyone will use it…. What proportion of people, for instance, will actually buy an autonomous vehicle or use shared transportation?”
Are EVs the Trick? Deloitte data show various degrees of interest in the electrification of personal mobility around the world.
“China,” the authors note, “is strengthening its policy ecosystem to drive EV growth…. Some European countries, including Norway, Britain, France, and the Netherlands, have even announced plans to ban the sale of conventional gas- and diesel-fueled vehicles over the next two to three decades.”
They caution, however, “EV adoption in North America is likely to lag due to a low-fuel-price environment, relaxed emissions standards, and a tighter tax-rebate policy.”
“Even if one accepts the most optimistic forecast for global EV sales over the next decade [see T. Rowe Price’s forecast], this number is still a drop in the bucket compared to the more than 1.2 billion fossil-fueled vehicles currently on the road. With a life expectancy of more than 10 years, these traditional vehicles will likely remain the dominant automobile type for some time to come.”
Deloitte global data also show electrification trends favoring hybrids, not battery electrics. Others, such as fuel-cell electrics, show global awareness as well; indeed, in India and Korea, they outscore BEVs.
Addenda: Automotive News, January 28, 2019, offered insight by Yang Jian in “Now We Know Who is Really Buying Electric Vehicles in China.” Briefly, the China Association of Automobile Manufacturers reported that roughly 886,000 EVs and plug-in hybrids were sold January–November 2018. However, 201,000 of these, fully 23 percent, went directly into the manufacturers’ fleet divisions.
And on an infrastructural note, Automotive News editor-in-chief Keith Crain wrote in February 11, 2019, “Who Covers the Other Costs?” He asks, “Without the enormous amount of tax revenues collected on the sale of gasoline, we’d have to come up with another system to raise the billions of dollars needed to build and maintain roads, bridges and other infrastructure.”
It’s a far cry indeed from government subsidies in favor of vehicle electrification.
Tomorrow in Part 2, we’ll pick up with Deloitte specialists’ views on autonomous vehicles, vehicle connectivity, and sharing the ride. ds
© Dennis Simanaitis, SimanaitisSays.com, 2019