R&D Management Conference 2011

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R&D Management Conference 2011

Linkping University 28-30 June 2011

The Electric Car Revolution:

Capabilities of the Multinational

Car Manufacturers and the

Important Role of the

Governments

Assist. Prof. Asli Tuncay-Celikel

Prof. Nick von Tunzelmann


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Todays Agenda

Introduction

Methodology of the paper

Theoretical Framework

Introduction to Electric Cars Major Events in the History of Electric Cars

Capabilities of the Automotive Manufacturers

The Important Role of the Governments

Findings and Conclusion

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Introduction

There is an urgent agenda for the governments that they shouldbe proactive in order to prevent the most importantenvironmental threat of global warming (Kyoto Protocol, 1997).

From transportation to housing, even in peoples daily liferoutines, there are always ways to decrease carbon emissions.

Especially car industry that 90 % of the vehicles work withpetroleum is giving harm to the environment.

Besides being a high threat to the environment, according to thefuture energy predictions ofInternational Energy Agency (2010)petroleum reserves will diminish in the next 50 years and thereshould be investigation of alternative energy resources such aselectricity, solar or hydrogen.

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Introduction

Multinational car manufacturers main concern is to develop fuel-

efficientcars with fewer emissions. Recently some automotive

manufacturers have already developed hybrid electric vehicles

(HEVs) and electric vehicles (EVs).

Some governments are providing incentives to R&D projects for

electric cars and EV charging points/filling stations.

For all these efforts, there have been very little to show for the

outcomes as far as electric vehicles are concerned over the pastcentury during which they have been under development.

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Aim of the Paper

to understand the capabilities of the multinational

car manufacturers in developing electric cars

the importantrole of governments to support R&Dof green automobiles and encouraging consumers to

use electric cars

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Methodology

exploratory research

secondary data from annual reports and statistics of

the global auto manufacturers

face to face interviews are applied to R&D managers

and policy makers (primary data)

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Main Research Questions

What are the capabilities of the multinational car

manufacturers in developing electric cars?

What could be the important role of governmentsto support R&D of green automobiles and

encouraging consumers to use electric cars?

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Theoretical Framework

Capability refers to the ability of firms to perform certain

tasks and jobs.

Supplier capability includes the suppliers expertise in making

the necessary batteries for the electric cars;

Production capability relates with the manufacturing

companies electric car production capability including

technical skills, know-how, R&D infrastructure, labour and

experience.

Consumer capability refers to whether the consumers are

informed to use electric cars and ready to change their carswith electric cars or not.

Dynamic capability is defined as the firms ability to integrate,

build, and reconfigure internal and external competences to

address rapidly changing environments (Teece et al., 1997).8


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History of Electric Cars

First electric cars were developed and

manufactured in England, France and

United States in 1880s and became

popular at called as golden age of electric

vehicles (1895-1905).

In the history of electric automobiles,

people first developed electric horse cars

or phaetons.

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In the records, 1897 electric taxis

were common in the city of New

York. Even hybrids cars were

developed in 1900s. However the

demand for them drasticallydecreased after mass production of

cheaper cars were produced with

gasoline. There is a dead period of

electric cars in 1930s till 1960s.


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After nearly 30 years, they have re-birth again in 1960s

(Ernest H. Wakefield, 1993).

There are some reasons behind this re-birth; petrol crisis

(1987) and need for alternative energy resources and

environmental concerns and regulations needs to be

done in the transportation system.

First mass produced EV called EV1 by General Motors.

When petrol prices decrease, GM stopped its production.

In 1991, Ford produced the electric version of theEuropean Escort light delivery van known as Ecostar.

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Tesla Roadster EV

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Mass Produced Electric Cars

Swedish Company Clean Air Transportfor whomInternational Automotive Design had developed aninternal combustion/electric hybrid car known as

LA301. This car has intended to meetCalifornian zero-emission requirements over commuting distances.

These requirements were issued by California AirResources Board in 1990 a mandate and it is requiredthat by 1998, 2 per cent of light duty vehicle sales of each

auto company selling more than 35 000 vehicles per yearin California must be a zero emission vehicles. Themandate required General Motors to sell about 35 000electric cars in California by 2003 (Micheal HerewardWestbrook, 2005).

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Major Events in the History of

Electric CarsYear Event 1800 primary cell and battery

1821 the electric motor

1834 first electric road vehicle powered by a primary battery

1859 the secondary cell and battery

1881 the first electric vehicle to be powered by a secondary battery1885 1st internal combustion engined vehicle

1887-98 Range of electric vehicles developed in Europe and the USA

1900 Equal numbers of steam, electric and gasoline vehicles compete forpublic acceptance

1900-12 Golden age of the electric vehicles but gasoline-engined vehiclesbegin to dominate

1921-60 Electric vehicles appear in very small numbers1990 Californian zero-emission regulations spark new activity in developing

electric vehicles

1990- Increasing number of electric vehicles with new battery technologiesappear

Source: Westbrook, M H (2005): The Electric Car: Development and Future of Battery, Hybrid and Fuel-Cell

Cars, The institution of electrical engineers, IEE power and energy series 38, University press, Cambridge,UK

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Types of Electric Cars

Hybrid Electric Vehicles (HEVs)

Toyota Prius, Honda Insight

Plug-in Hybrid Electric Vehicles (PHEVs)

Chevrolet Volt, Vauxhall Ampera, VW Golf (2012), TH!NK City

Electric Vehicles (EVs)

Tesla Roadster battery electric vehicle

G-Wiz, NICE Mega City, Whhego Whip Life, CODA Sedan, Reva

NXR, Tata Indica Vista EV, Ford Focus BEV, Hyundai Blueon,Nissan Leaf, Renault Fluence

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Toyota Prius 1997

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Honda Civic 2002

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Toyota Prius Honda Insight

20002000--20062006

Honda Civic Toyota Prius HSD-II Honda Accord Ford Escape Mercury Mariner

Nissan Altima Lexus RH400

20072007--........

Honda Fit Mazda Tribute Chevrolet Tahoe Dodge Durango Mercedes-Benz S Class

1990s1990s

Porche Cayenne VW Touareg VW Jetta Toyota FT-HS Sports Hyundai Accent/Kia Rio

HEVs and EVs


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Source: TUBITAK MAM presentation

Mitsubishi IMIEV


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The Renault Fluence Z.E. is the

worlds first EV with a switchable

battery



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The 2011 Chevrolet Volt Extended

Range EV



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Capabilities of the

ManufacturersCapabilities of the Multinational Car Manufacturers

(Tunzelmann, 2009)

Supplier Capabilities

Production Capabilities

Consumer Capabilities

Dynamic Capabilities

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Analysis regarding Capabilities

Essentially the know-how needed to make electric cars isrelated with the batteries. When we look into the process ofbattery development period, it took longer than expected.It was the lack of good batteries that slowed down the

deployment of electric cars, which date from at least 1899and 1920, respectively (Armand, 2008).

For all this effort, there has been very little to show for theoutcomes as far as electric vehicles are concerned over thepast century during which they have been underdevelopment.

Why is the case? The fault is usually attributed to failingson the supply side, namely weaknesses of technologicalstretch-out especially in regard to the batteries(Tunzelmann, 2009). 23


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The Important Role of the

Governments Government Incentives

Electric Car Zones

Charges and Filling Stations

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According to Deloittes report (2011) electric vehicles and

other green cars will represent up to a third of total global

sales in the developed markets and up to 20 percent in

urban areas of emerging markets.

There is no doubt that electric cars both HEVs and EVs will

be increasing their market shares and manufacturing firms

should be acting towards the greening trend and develop

their own HEVs and EVs as soon as possible.

It is seen that there are some R&D collaborations for

cleaner energy vehicles in each and every segment of the

car industry.25


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Governments have very important roles to foster the R&D

of electric cars. Proving incentives to R&D projects of

electric cars is the first and the most important step.

Second, consumers should be encouraged to use electric

cars. Electric car park free areas should be established,

there should be reduction in taxes (road tax) and

insurances so that the prices of the electric cars could be

cheaper.

In addition governments should be encouraging filling

stations and putting EV charging points across their

countries.26


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Findings and Conclusion (3)

It is believed the electric car revolution has started but its

continuation is dependent on the dynamic capabilities of

the manufacturing companies good interaction of supplier,

production and consumer capabilities as well as the

policies of the governments.

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Thank You!

Asli Tuncay-Celikel

Post-doctoral Visiting Research Fellow

University of Sussex, UK

Science and Technology PolicyResearch (SPRU)

[email protected]

For connecting via LinkedIn: [email protected]

R&D Management Conference 2011

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