When you see this headline, the first thing many of you may think is: I haven't even considered buying an electric car yet. But while developed countries started to set timetables for the regulation of zero-emission vehicles, and the rapid decline of battery costs drives the price of electric vehicles getting closer to that of fuel-powered vehicles, it's just a matter of time to switch to electric vehicles. In this case, the headline is reasonable to proceed for further discussion.
Since last year, Tesla entry-level Model 3 has begun to sweep the global electric vehicle market after breaking through the problem of production capacity; The Gigafactory in Shanghai has started mass production this year to directly enter the China auto market, and then plan to produce the possibly more hot-selling Model Y. The market share evolvement among brands in Taiwan is starting to reflect consumer insight as well... electric vehicle is now truly a decent option on the shopping list. In this way, the impact on the slow-paced traditional carmakers triggers the emergency of pulling the alarm; As for the war between automobile industry and IT industry, I try to analyze it in four stages⋯
- Before 2020. From the outset, the startup technology companies’ strategy of huge investment in research and development to prolong the time period of breakeven point has been an attempt to widen the gap with traditional car manufacturers in the progress of new technologies. During this stage when many companies are closed due to financial pressures, those that can survive will have the opportunity to seize the next turning point of the booming EV market. The cost of lithium-ion batteries has been falling rapidly over the past a few years, but battery capacity (range) and the deployment of fast-charging stations are still the biggest obstacles for ICE car owners to switch to electric vehicles. On the other hand, traditional car manufacturers have of course realised that the EV trend is unstoppable. But with “traditional” thought of profitability, it would be better to delay the decision as long as possible and let the battle for EVs happen as late as possible. Now there is only one Tesla after all. What if there are five Tesla in the world?
- 2020 to 2025. The next five years are, in my opinion, the critical moment for the the EV market to soar. The technology and cost competitiveness of lithium batteries will reach its peak, and the deployment of fast-charging stations will become another major competitive industry. The competition and collaboration between the IT industry and the carmakers is intensifying... The automotive industry is investing heavily in research and development, profits are shrinking and organisations are becoming leaner. The only way for them to catch up with the overall product competitiveness of the electric carmakers is to rely on years of basic craftsmanship to emphasise the fundamental value of the vehicle, so to keep the customers who are not so technology-obsessed. These five years will also be the most difficult time period of transformation and low profitability for traditional car manufacturers, but on the contrary a period of rapid and profitable growth for electric car manufacturers and the startups.
- 2025 to 2030. The time when the price and charging convenience of electric vehicles reach a generally acceptable level for consumers, electric vehicles will gradually become the mainstream of the car market. But because the capacity of lithium batteries is difficult to technically break through, it is still the last obstacle; At the same time, new battery technologies are surging, especially the commercialization of high-capacity and high safety solid-state batteries may occur, but the manufacturing cost is still too high to become the mainstream. At this point in time, the traditional car manufacturers, just having suffered a market share impact during the transformation period, will be able to fully utilize their solid automotive technology and financial management to deliver new models that are strong enough to take on the electric car manufacturers and even begin to outperform them. As for the electric car manufacturers, they will work with technology partners to open up a new battlefield for fully autonomous driving, extending the frontline of the battlefield with traditional car manufacturers and giving consumers more choices to keep the technology chasers on their heels. This period of time will be most likely the very last period of consolidation before the 100 years-old automotive industry steps into a whole new era.
- After 2030. The technology of electric vehicles will begin to phase out ICE vehicles as a result of the commercialisation of solid-state batteries. At the same time, as autonomous driving technology is well-developed, the race for newer and more powerful battery technology will continue. At this point in time, in consideration of buying a car, it is no longer to decide whether you want an electric car, but which level of autonomous driving or tailor-made features you need for your electric car? At this point, it may be difficult to tell the difference between traditional car manufacturers and electric car manufacturers/ IT industry, which were pretty much obvious 10 years ago. In other words, the headline of my post here no longer has any meaning for further discussion.