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

Today s 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

Introduction
There is an urgent agenda for the governments that they should be proactive in order to prevent the most important environmental threat of global warming (Kyoto Protocol, 1997). From transportation to housing, even in people s daily life routines, there are always ways to decrease carbon emissions. Especially car industry that 90 % of the vehicles work with petroleum is giving harm to the environment. Besides being a high threat to the environment, according to the future energy predictions of International Energy Agency (2010) petroleum reserves will diminish in the next 50 years and there should be investigation of alternative energy resources such as electricity, solar or hydrogen.

Introduction
Multinational car manufacturers main concern is to develop fuelefficient cars 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 past century 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 important role of governments to support R&D of green automobiles and encouraging consumers to use electric cars

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)

Main Research Questions

What are the capabilities of the multinational car manufacturers in developing electric cars? What could be the important role of governments to support R&D of green automobiles and encouraging consumers to use electric cars?

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 cars with electric cars or not. Dynamic capability is defined as the firm s ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environments (Teece et al., 1997).

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.

History of Electric Cars

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 drastically decreased 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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History of Electric Cars

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 the European 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 Transport for whom International Automotive Design had developed an internal combustion/electric hybrid car known as LA301 . This car has intended to meet Californian zeroemission requirements over commuting distances. These requirements were issued by California Air Resources Board in 1990 a mandate and it is required that by 1998, 2 per cent of light duty vehicle sales of each auto company selling more than 35 000 vehicles per year in California must be a zero emission vehicles. The mandate required General Motors to sell about 35 000 electric cars in California by 2003 (Micheal Hereward Westbrook, 2005).

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Major Events in the History of Electric Cars

Year Event

1800 1821 1834 1859 1881 1885 1887-98 1900 1900-12 1921-60 1990 1990-

primary cell and battery the electric motor first electric road vehicle powered by a primary battery the secondary cell and battery the first electric vehicle to be powered by a secondary battery 1st internal combustion engined vehicle Range of electric vehicles developed in Europe and the USA Equal numbers of steam, electric and gasoline vehicles compete for public acceptance Golden age of the electric vehicles but gasoline-engined vehicles begin to dominate Electric vehicles appear in very small numbers Californian zero-emission regulations spark new activity in developing electric vehicles Increasing number of electric vehicles with new battery technologies appear

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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

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 15

Toyota Prius 1997

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Honda Civic 2002

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HEVs and EVs

1990s

Toyota Prius

Honda Insight

20002000-2006
18 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

Porche Cayenne

VW Touareg

VW Jetta

Toyota FT-HS Sports

Hyundai Accent/Kia Rio

Mitsubishi IMIEV

Source: TUBITAK MAM presentation

The Renault Fluence Z.E. is the world s first EV with a switchable battery

Source: TUBITAK MAM presentation

The 2011 Chevrolet Volt Extended Range EV

Source: TUBITAK MAM presentation

Capabilities of the Manufacturers

Capabilities 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 is related with the batteries. When we look into the process of battery 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 1899 and 1920, respectively (Armand, 2008). For all this effort, there has been very little to show for the outcomes as far as electric vehicles are concerned over the past century during which they have been under development. Why is the case? The fault is usually attributed to failings on the supply side, namely weaknesses of technological stretch-out especially in regard to the batteries (Tunzelmann, 2009).

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The Important Role of the Governments

Government Incentives Electric Car Zones Charges and Filling Stations

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Findings and Conclusion

According to Deloitte s 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.

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Findings and Conclusion

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.

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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 Policy Research (SPRU) A.Tuncay-Celikel@sussex.ac.uk

For connecting via LinkedIn:

atuncay@isikun.edu.tr

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