Hybrid and Pure Electric Cars – the Next Ten Years
Peter Harrop, Chairman, IDTechEx
A radical change in attitude to electric vehicles has occurred in 2009, resulting in huge new financing from governments and tough new laws that will boost sales. Now all car makers must offer electric versions in their line up or face oblivion as governments finally get serious about global warming, oil running out and the domino effect of imminent collapse of their traditional car industries. Earlier forecasts of these markets therefore need revisiting and, in a timely response, IDTechEx has issued a totally new report “EV Cars – Hybrid and Pure Electric 2009-2019”. Entirely researched in 2009, this analyses the effects the new market drivers. They include the tens of billions of dollars that will now be invested in those developing, manufacturing and buying electric cars and their components, the surge of new models and the remarkable new technological breakthroughs.
The breakthroughs include safe lithium batteries that last ten years, ones that charge in minutes, albeit with special chargers, affordable and luxury pure EV cars with 250 miles range and a wide choice of plug in hybrids very soon. Many new battery chemistries look promising for the future. Some of the new electric cars generate at least some of their electric power from solar cells on the vehicle. In future they may generate electricity in part from shock absorbers, transparent solar cells over windows and – thermoelectrically - from the engine and exhaust in hybrids. All these possibilities are now the subject of research and development. There are better supercapacitors coming along to overcome the shortcomings of batteries by being connected to them and even the painfully named supercabatteries may prove useful. They combine the virtues of both. These and other innovations provide a credible technological roadmap for electric cars particularly now the funding is available.
Here come China and India
Then there is the value for money that India and China will offer as they seek to take over the world’s auto industry, not least by leapfrogging in electric cars. Indeed, IDTechEx notes how, years ago, Japan took the world by storm by offering highly reliable, attractive cars with most options included. The modern equivalent will be a car company offering plug in hybrids without the usual price premium over the traditional equivalents. That will happen within the decade in the view of this analyst.
Wake up time
Just as people tend to stop smoking only when they feel unwell as a consequence, the governments of the world finally woke up to global warming when its effects on agriculture and much else became all too obvious. A US president closely supportive of the old oil and motor industry has been replaced by a president who could not be more different. President Obama specifically names plug in hybrid cars as a way forward. Elsewhere in the World things are also on the move. For instance, Denmark now has a program to install 20,000 EV charging points for EV cars across the country and the race is on for viable plug in hybrids to be offered by all serious major manufacturers worldwide. Most countries are making progress in replacing dirty power stations, so using grid electricity will become a green activity and a very low cost one for the car owner.
Vision of 2025
Electric cars will rise to 35% of all cars produced in the world in 2025, according to IDTechEx. Of that, 10% will be pure electric cars and 25% will be hybrid electric, hybrids having led in both numbers and dollar value for 20 years. What economists would call a leading indicator of this is the fact that the number of new hybrid cars launched in 2012 will be about 20, ten times the figure in 2003 and giving a cumulative figure of over 100 models. Of course not all those models are still available but the growth in choice of both hybrid and pure EV models is becoming formidable. That growth in choice will continue after 2012. Another leading indicator of success with hybrids is the trend in investment in development of the relevant components and cars and the subsidies to buy them. They have suddenly leapt at least tenfold.
That said, there are still danger signs, as the IDTechEx report testifies. In general, consumers will still not pay extra for something environmental so governments must energetically and consistently tip the balance. In the West, governments are concentrating on rescuing traditional banks and car companies not preventing the drying up of venture capital essential to the start-ups that will provide vehicles and their components of the future. For example, in the UK, venture capital is at half the level of 2000 and 1000 worthwhile ventures are set to go under in the next year due to a collapse in funding.
Support for the old car companies must not be like the support for the British Leyland car company in the UK decades before where the market was rigged in the direction of a business run incompetently by politicians with little attempt to make what people want, thus wasting huge amounts of money while making it near impossible for better companies to emerge. Batteries continue to attract too little effort and their parameters are not improving enough. Fuel cells - like taming the H bomb ie thermonuclear research - attract larger sums while always being ten years away.
Simple things that government could encourage such as filling stations that exchange traction batteries and provide fast charging are only rarely appearing. Plug in hybrid and pure EVs lose much of their justification when so many power stations are not using renewable energy or even nuclear. Where is the energetic move to green energy? The British, for example have been talking for eighty years about the tidal power at a possible Severn Barrage providing 5-10% of the nation’s electricity but they are no nearer to building it. China and the US have largely dirty power and adaptation for carbon capture is, as yet, unproven. Of course there are exceptions, Denmark doing a good job with wind turbines, France with nuclear energy and New Zealand having almost 100% renewable hydroelectric and wind power.
Despite the above concerns, IDTechEx believes that the increased determination of governments, manufacturers and users will result in a considerable growth in sales of both hybrid and pure electric cars. It gives numbers, unit value and total dollar value for global markets for hybrid and for pure electric cars up to 2019 and a view up to 2025, including the share of the car market overall. It looks at the past, present and possible future performance of Toyota, the market leader and still the only company to promise a hybrid version of all its models. An extract from these data is given below.
Figure Global market in 2015 for hybrid vs pure electric cars in millions of units
Different rates of adoption
The pure electric versions are seen taking off more slowly because their success is heavily dependent on potential pollution laws, improvements in battery life and the range they provide, availability of more versions that are fully crash tested and suitable for major highways and more versions that are very low cost. They start from a much poorer base because most of the early sales are simply golf cars to a saturated market on golf courses and lackluster sales of Neighborhood Electric Vehicles NEVs because of old designs and lack of scale. However, IDTechEx is sure that electric cars of all sorts will be responsible for around 20% of global car sales in 2019, even though fuel cells may still be a side issue at that time. Indeed, we agree with some manufacturers that project hybrids being 25% of car sales in 2025, at which time, sales of pure electric cars may be 10% of global car sales. Many manufacturers of pure electric cars now offer lithium batteries and range of 100 to over 250 miles and these are not like the ugly duckling, fragile, old golf cars and neighbourhood vehicles. They are “real” on-road cars and marketed as such. Some of these manufacturers of pure electric cars are laying down production lines to make hundreds of thousands yearly.