Automaker Partnerships Will Reduce Battery Costs, Drive EV Production - Study
By Scott Doggett March 19, 2010
By Danny King, Contributor
Annual global hybrid-electric (HEV) and battery-electric vehicle (BEV) production will more than triple over the next six years as Toyota extends its lead in the HEV market while automaker partnerships such as the one between Renault and Nissan help double BEV production every year by lowering the cost of batteries, according to a report released this week.
Additionally, battery-electrics may actually account for a larger percentage of cars made by relatively smaller-volume companies such as BMW and Mercedes-Benz than for Nissan or Toyota within the next few years as those German automakers increase their investment in their MINI and Smart brands, respectively, in an effort to meet tightening emissions and gas-mileage standards, according to the report by Boston-based Strategy Analytics.
As a result, annual hybrid production will jump to 4.6 million vehicles in 2016 from 1.4 million this year, while BEV shipments, which will be in the 20,000 range this year as Nissan introduces its battery-electric Leaf in late 2010, will surge to about a half-million vehicles, Strategy Analytics said, citing what it called its "moderate" scenario.
Such expansion of HEVs and BEVs will be key if automakers are to meet U.S. and overseas regulators' tightened emissions and gas-mileage standards because automakers can only improve gas mileage so much with improvements on gas-powered vehicles such as stop-start systems and smaller engines, according to the report.
By 2020, the European Union is looking to cut automotive emissions by about 33 percent from the 1998 standard, while the U.S. has set a 2016 deadline to hit gas-mileage standards that represent about a 30 percent improvement from today.
Despite expected cost reductions to battery packs as volume grows, most of the EV growth will be in wealthier regions such as the U.S. and Europe, according to Kevin Mak, industry analyst in the Strategy Analytics automotive electronics service and author of the report.
"Examples include the MINI E and the Smart ForTwo," wrote Mak. "Because of the higher costs from the batteries, these EVs are more likely to be sold in mature markets."
Still, even with such demand from economically mature regions, Strategy Analytics' numbers may be optimistic, according to other analysts. Pike Research and HybridCars.com said in a December report that automakers in 2015 will sell about 3.2 million hybrid-electric and battery-electric vehicles, with about half of the BEVs being sold in the Asia-Pacific region.
"Battery costs will be reduced significantly but I don't know if that will happen quite this rapidly," David Cole, chairman for Ann Arbor, Mich.-based Center for Automotive Research, said in an interview. Cole added that the price of gas, which could be anywhere between $1.50 and $5 a gallon, "will be a huge factor in the market."
For some, though, the forecast may be conservative. Nissan and Renault earlier this week said they expect global production of electric cars to reach 500,000 vehicles by 2012. Renault and Nissan will be the leader in the BEV market because of their relatively early commitment to the technology as well as an expected volume of BEV sales that will likely lower the cost of battery packs, according to Strategy Analytics.
The Renault-Nissan Alliance, which was started in 1999, has reached agreements with dozens of municipalities around the world to expand electric-vehicle-charging networks globally as Nissan prepares to start selling the Leaf.
Conversely, Volkswagen Group, which includes Audi, will lag behind because of what Strategy Analytics called "its relatively late enthusiasm for hybrid and electric vehicle technologies." While the automaker will have a 10 percent share of the global light vehicle market in 2016, its share of the hybrid and battery-electric market will be about half that.
Regardless, much of the numbers depend on how vehicles such as Chrysler's GEM neighborhood electric vehicles - or "glorified golf carts," as some call them - are classified, according to Brett Smith, director of the automotive analysis group at the Center for Automotive Research.
"In some scenarios, these may account for a relatively large market," said Smith. "The definition of vehicle class is important. But 5 million is still very optimistic."
LEAVE A COMMENT