Carmakers brace for shocks as electrified future looms

Electric vehicles are the stars of this year's Paris Motor Show
Electric vehicles are the stars of this year's Paris Motor Show

Auto industry executives gathering this week for the Paris Motor Show will be rubbing shoulders with unusual company: dozens of tech experts eager to tackle what many consider the ultimate connected device.

Electric vehicles are the stars of this year's show, with premium brands like Mercedes and Audi finally jumping into the fray, but the promise of self-driving cars is also on display with dozens of start-ups on hand.

"Each of these new cars requires 100 million lines of code: That's five to six times more than in a Boeing," Luc Chatel, head of the French auto industry association, told executives on Monday.

The enthusiasm for the electrified revolution is partly out of necessity, as regulators and local officials try to cut down on the smog chocking many large cities.

In Europe, carmakers are racing to comply with tough EU limits on CO2 emissions that take effect by 2021, and the introduction of tougher emission testing standards in the wake of the "dieselgate" cheating scandal.

After investing billions of dollars in new batteries despite a still-uncertain payoff, companies are also betting that electric cars will help their bottom lines.

More reliable and with fewer moving parts than , electric motors require far fewer workers to install and service.

But industry chiefs know they won't be able to develop the full potential of an electrified, always-connected future on their own.

Google, Nokia and French IT specialist Atos are among the tech groups sending staff to the Paris show with pledges to help automakers navigate their industry's seismic shift.

"Obviously every company would love to do everything by themselves," Carlos Ghosn, head of the Renault-Nissan-Mitsubishi alliance, said in a keynote address Monday.

"There is an explosion around the services of mobility, where carmakers are going to play a role, in partnership with others," he added, predicting that "we're going to see in the Motor Show less and less car companies."

Ghosn expects his group to sell 14 million cars by the end of 2022, of which 10 percent will be all-electric.

Audi and Mercedes are to show all-electric SUVs at the Paris Motor Show
Audi and Mercedes are to show all-electric SUVs at the Paris Motor Show

Steep prices, uncertain future

But joining with tech companies means ceding part of the profit, not exactly a welcome prospect for an industry just recently back on a stronger footing after years of bailouts for many in the wake of the 2008 economic crisis.

Automakers are also grappling with lithium-ion battery costs that keep electric vehicle prices well above those of traditional cars—the new models are still loss-makers for most companies.

Mike David, an analyst with Bloomberg Intelligence, forecast that prices would not come down to competitive levels until 2025.

And with new technologies comes the chance for upstarts to jump in: Tesla's market value is greater than that of Renault and PSA combined despite production snafus and recent blunders by its flamboyant founder Elon Musk.

Adding to the headwinds are changing consumer tastes: More people now live in urban centres where alternative modes of transport from cycling to scooters are flourishing amid the zero-emission zeal.

Many no longer see the need for owning a car, electric or not.

"Single-use vehicles are wasteful," said Ian Simmons of Magna International, a parts maker specialising in "green mobility".

Car-sharing and ride-hailing services like Uber and Lyft—which are racing ahead with their own autonomous driving research—will require heavy tech investments in cars and city infrastructure, he said.

But with Audi and Mercedes showing off all-electric SUVs this week—shortly after Ferrari announced an ambitious plan for hybrids—more buyers might be convinced their performance has caught up with combustion engines.

"Their arrival also dispels any doubts over battery or quality issues," JATO analyst Felipe Munoz wrote in a research note.

The Paris Motor Show opens to the public on Thursday and runs until October 14.


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Germany to have 1 million electric cars by 2022

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Oct 02, 2018
I read these articles with interest but I am disappointed when I see that they always leave out the crucial detail of electrical grid capability to support the increased demand.

Is anyone coordinating with the public utilities to insure there is sufficient electric generation and distribution capabilities to satisfy the increased demand on the power grid? Probably not. Power Stations of any kind generally take 10+ years to plan and build which makes them obsolete before they generate a single watt of power.

I'm old enough to have seen this kind of failure to plan ahead of need many times.

Oct 02, 2018
I read these articles with interest but I am disappointed when I see that they always leave out the crucial detail of electrical grid capability to support the increased demand.

Because it's a non-issue. If you do the calcs then the extra power needed comes out on the order of 10-15%. And, of course, that isn't needed immediately but until everyone has switched over - which should be will into the 2050's or thereabouts. Such a slow rampup gives utilities plenty of time to react. New wind or solar farms can be up and running within a year or two.

The relevant figures:
- average miles per car per year
- average kWh/100miles usage of electric cars
- number of cars on the road today
can be gotten from the government statistics site of your relevant country.

Many power companies are also partnering with charging network companies (obvious step for them, really). They know what's coming.

Oct 03, 2018
If you do the calcs then the extra power needed comes out on the order of 10-15%.


But if you really do the calcs, the extra power demand can easily overwhelm the grid, on both local and system scale.

Take Germany, and 1 million electric cars (all cars: 45+ million). Then suppose these 1 million cars happen to be plugging in to the grid at 7 AM when their owners arrive to work. Each of them draws 16 Amps x 220 Volts = 3.5 kW, times a million equals 3.5 GW of power demand coming online over the span of a few minutes.

The German grid capacity is 198 GW, though that isn't all dispatchable power that you can control. Nevertheless, 2% of all cars can draw 1.8% of the electric grid capacity simply by being on the charger on the same hour. Close to 1:1 match.

If you had 100% of the cars plugged in at the same time, nearly the whole grid would be serving them. Fortunately that's unlikely to happen. Still, it causes tremendous demand fluctuations

Oct 03, 2018
New wind or solar farms can be up and running within a year or two.


Wind and solar farms aren't dispatchable power - you can't turn them on and off at will - so they don't help with the issue. They either are, or not, available when the EVs plug in to charge. If they are available, that power is already going somewhere because you can't have "extra" on the grid in wait of someone to use it.

So each time then, you have to scramble to turn on gas turbines and large diesel engines to avoid a grid collapse, and the power for the EVs necessarily, and to a great part, must come from dispatchable sources which are typically fossil fuels. Where hydro is available, that.

A good point of reference is to notice that an EV draws about the same power from the grid as a house, so for every neighborhood full of electric cars, it appears like the number of houses doubles every afternoon when the commuters come home and plug their cars in.

Oct 03, 2018
Though of course you could -make- solar & wind dispatchable simply by building more, and then not using it until needed - but then you have to pay the owners to keep them offline until needed, and pay them for the electricity as well, because the entire cost of the machinery must be paid, with interest, whether you use them or not.

So it's a choice of whether you want to pay 10x the price for your electricity.


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