Author: Ersin Kara

It’s electric: Experts split on the future of EVs Electric vehicles are generating more buzz in the auto industry as the years go by. But looking 25 years into the future, analysts’ opinions vary greatly over how much influence these vehicles will have on drivers and automakers. Bob Lutz, former vice chairman of General Motors, predicts that by 2039, almost all private transportation will be done by electric vehicles. Kevin Riddell, manager of powertrain forecasting at LMC Automotive, said gas-powered vehicles may not have the near 100 percent penetration they have now, but they will likely still make up 50 to 75 percent of the market. Tom Kloza, chief oil analyst at GasBuddy.com, said gasoline will be “king of the kingdom” for the next 10 to 15 years, but beyond that, it’s too hard to predict. Welcome to the great debate over the future of electric vehicles. The ‘sizzle and fizzle’ effect One reason for the wide range of estimates is uncertainty over levels of investment. Today, Navigant Research estimates there are 200,000 pure electric vehicles amid the roughly 242 million vehicles in America, or 0.08 percent, with just over 1 million charging stations. But most of today’s EVs were bought, in part, with the assistance of state and federal tax credits. Uncle Sam has also made a healthy investment in the electric vehicle infrastructure by subsidizing the construction of charging stations. Researchers with the MIT Sloan School of Management estimate battery electric vehicles could reach only 3.7 percent of all vehicle sales in 2040 if the auto industry, state and federal governments and the public maintain their current levels of investment. But they could soar to 50 percent of all vehicle sales by that time if there’s a coordinated effort to push EVs. In short, for electric cars to truly take off, more money needs to be spent. “You need a combination of positive influences from each one of these for the EV market to finally pick up,” said Claire Weller, one of the MIT researchers. “Individually, they are not sufficient to support the EV market in the long term.” Researchers said risk also lies in the fact that electric vehicles are a prime candidate for what they call the “sizzle and fizzle” effect—when there’s initial enthusiasm for a technology but it struggles to hold over the long term. At the heart of the question about how quickly electric vehicles will gain popularity is when automakers will design lithium-ion batteries that go farther at a far lower cost. Right now, the most popular mass market electric car, the Nissan Leaf, can go 80 to 90 miles on a full charge. The Tesla Model S, a luxury pure electric car, has a far greater range of closer to 300 miles. But drivers pay for that range by getting a car with a larger, more powerful and much more expensive battery pack. The Chevy Volt, a range-extended electric car that has a gas-assist engine, offers owners the first 38 miles all-electric before the gas-assist engine kicks in, giving the driver up to another 342 miles. They are the best-selling electric cars in America and symbolize the challenge facing automakers: to give EV owners more range, they have put in more expensive battery packs. Further complicating their efforts is the fact that bigger battery packs are heavier and weigh on the car’s range. Lutz predicts these issues will be resolved over the next decade. “With these advanced batteries, in 10 to 15 years a car like a Chevy Volt will go 400 miles,” he said. “If you have 400 miles electric who needs a gasoline engine anymore?” Tesla CEO Elon Musk is hoping battery costs will drop and their range will grow when the company opens a Gigafactory in 2017 to ramp up production of lithium-ion battery cells. Tesla has also said it will release all of its patents in hopes of spurring greater development of electric vehicles by other companies. Both moves are geared toward one goal: sparking a surge in electric vehicles. Nonetheless, many in the auto industry said the vehicles most Americans drive today will likely be what they’re driving 25 years from now. Gas-powered cars may remain the primary choice for many Americans because they’re familiar with them, and the mileage on those vehicles is expected to continue to climb. “I wouldn’t be surprised to start seeing 60 miles per gallon or 70 miles per gallon in some of the [gas-powered] vehicles that they are going to produce 25 years from now,” Riddell said. The Union of Concerned Scientists estimates the U.S. could cut its oil consumption by 4 million barrels a day by 2035 if it stays on track and doubles fuel economy standards by 2025 to an auto fleet average of 54.5 miles per gallon. That would equal cheaper gas for drivers. And as internal combustion engines become more efficient, automakers and those invested in the oil and gas industry will also push the convenience of filling up in minutes and drivers’ ability to go where they want at any time. “With an electric vehicle right now, you pull in, you refuel and it takes over a half an hour to recharge for, you know, 70 or 80 miles in some vehicles, and that really makes people feel uncomfortable,” Riddell said. —By CNBC’s Phil LeBeau Source: http://www.cnbc.com/id/101918055#.

Germany’s MAN moves bus production to Turkey * MAN to close German bus plant by March 2015 * All 420 workers to be offered new jobs at parent VW * Turkish labour costs much lower vs Germany -IW BERLIN, May 20 (Reuters) – German truckmaker MAN SE will shut its sole bus factory in its home market and shift production to lower-wage Turkey, responding to poor demand in core European markets. The 420 workers affected will be offered new jobs at a German division of MAN parent Volkswagen, Munich-based MAN said on Tuesday. Assembly of coaches and public-service buses will be moved from the plant in Plauen, Germany to Ankara by March 2015, the company said. “We have been left with no alternative but to move production to increase efficiency within our production network,” said Anders Nielsen, chief executive of MAN’s truck & bus division. Shifting production to Turkey, where MAN employs almost 1,700 workers in Ankara, will allow the manufacturer to significantly reduce its production costs. Labour costs in Turkey’s manufacturing industry were an hourly 5.17 euros ($7.1) per worker in 2012, about a seventh of the 36.98 euros in Germany, according to the Cologne-based IW economic institute. Sales of new buses and coaches weighing 3.5 metric tons or more in the European Union were flat in the first four months at 7,250 vehicles, according to European auto industry association ACEA. MAN’s Swedish rival Scania, also owned by VW, said in March it was aiming to cut 250 jobs at bus divisions. ($1 = 0.7289 Euros) (Reporting by Andreas Cremer; Editing by Erica Billingham) http://www.reuters.com/article/2014/05/20/germany-man-turkey-idUSL6N0O62IF20140520

Turkey’s automotive industry’s foundations date back to the early 1960s, when the first efforts to develop and produce the first Turkish-made passenger car were undertaken. During a period of rapid industrialization and progress, this key sector transformed itself from assembly-based partnerships to a fully-fledged industry with design capability and a massive production capacity. Matching and surpassing international quality and safety standards, today’s Turkish automotive industry is highly efficient and competitive with its value-added production. The sector’s export and R&D capacity is supported by high productivity levels, thanks to cooperation between the key components of the industry, with its subdivisions, positive interaction created in the joint university-industry projects and advanced logistics facilities. The Turkish automotive industry fully complies with EU environmental and technical standards, as well as other international legislations. A production capacity that easily meets customer expectations is one of the industry’s strong points. Improving in a way that preserves its innovative and flexible structure in the intensely competitive environment, the Turkish automotive industry has elevated the country to a prestigious global position, ranking 16th among automotive manufacturing countries in 2010, producing more than 1 million vehicles, while it is the largest commercial vehicle producer in Europe. Around 70 percent of the domestic production is being exported. Meanwhile, the number of vehicles sold in the domestic market was around 800,000 in 2010. The Turkish automotive industry, consisting of 17 domestic and foreign principal producers supplemented by approximately 4,000 sub-industry companies, directly employs some 300,000 qualified workers. Turkey’s GDP per capita in recent years has exceeded USD 10,000 due to its growing economy and stable fiscal structure, with capacity increasing in line with domestic demand. The number of vehicles per 1,000 persons, which was approximately 200 in 2010 (100 cars per 1,000 people), indicates the strong potential of the sector. In addition to the professional associations and unions, such as the Automotive Manufacturers Association (OSD), the Association of Automotive Distributors (ODD), the Association of Automotive Parts and Components Manufacturers (TAYSAD), the Union of Uludag Automotive Parts and the Components Exporters Associations (UTAYSİB), research and promotion platforms, including the Automotive Technologies Research and Development Center (OTAM) and the Automotive Industry Promotion Committee (OETK), actively guide the sector. International relations and the representation power of these institutions contribute to the global strength of the Turkish automotive sector. Ambitious targets for the near future have been set for the Turkish automotive industry, including achieving two million units in vehicle production, an export volume amounting to USD 50 billion, the realization of various R&D and P&D operations worth billions of US dollars and the formation of an “automotive production hub” that employs 600,000 workers and manufactures globally recognized quality and value-added products. http://www.invest.gov.tr/en-us/sectors/Pages/Automotive.aspx