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Nov 222016
 
The FT suggests that because battery powered cars all use similar batteries, it will be difficult for manufacturers to compete against each other.  Sense?  Or nonsense?

The FT suggests that because battery powered cars all use similar types of batteries, it will be difficult for manufacturers to compete against each other. Sense? Or nonsense?

There is a lot of misinformation and quite possibly, if the conspiracy theorists are to be believed, deliberate disinformation, about battery electric vehicles (BEV).

In part, much of this can be excused as the result of people not being up-to-date with the latest developments and trends in the rapidly evolving BEV technology.  But some of it is so laughably stupid, and from supposedly well informed sources, as to be inexplicable.

For example, in an article that seems to try hard to play down and minimize the trend to BEVs, and headed “Electric drive spooks Japan car executives” in the respected Financial Times newspaper (if you can’t open the article directly from the link, try searching Google for the headline and click from Google) there is this extraordinary statement :

And with so many carmakers offering their consumers the choice of an electric car, there remains the question of how each company can distinguish its product. Car batteries are sourced from a limited number of players including Panasonic, Samsung and LG — making it difficult for battery technology to set cars apart. Toyota, Volkswagen and others may also find it difficult to replicate Tesla’s success in creating a strong electric vehicle brand.

Think about this, if you will (and clearly no-one at the FT has thought about it at all).  Because there are only a few major suppliers of batteries, it is difficult for car manufacturers to distinguish their products???  Because one company is (arguably) successful at selling electric cars, no others can also be successful?

Isn’t that a bit like saying ‘because there are so few brands of gasoline, it is difficult for internal combustion engine car manufacturers to distinguish their products’?  Indeed, in truth, there are far more variations in battery chemistry and implementation than there is in gasoline, which car owners in any event use interchangeably in the cars they purchase.

And isn’t it also a bit like saying ‘Because Ford is so successful at selling light trucks, and because all car companies make light trucks out of metal, no other car companies can compete’?

Which batteries an electric car uses is an obscured issue that few if any purchasers care about at all.  They want to know about the range they get from the batteries, but do they care if one car uses the same or different batteries as another car?  No, of course not.

And if two different manufacturers buy batteries from the same source, does that mean the two cars are doomed to be identical in appearance, in performance, in size, in color, in price?  No, of course, absolutely not!

To put the battery issue into perspective, a new Tesla costing say $90,000 probably has an underlying battery cost of about $15,000.  The other $75,000 is entirely up to Tesla to spend any way it wishes.  A new Chevy Bolt probably has about $10,000 worth of battery in the $40,000 vehicle.

Does a Chevy Bolt, a Nissan Leaf, and a Tesla Model X all look indistinguishable from each other?

One more point.  One of the most fiercely competitive industries out there is the airplane manufacturing industry.  But, all manufacturers source engines from the same two or three engine manufacturers.  Does that make their planes identical in any way, shape, or form?  No, of course it doesn’t.

How on earth can anyone suggest that using the same supplier for batteries prevents car manufacturers from successfully distinguishing between their different make/model cars?

And, if you are indeed a conspiracy theorist, you will note that this assertion ‘comes from nowhere’ – it isn’t attributed to anyone.  Who is making this claim?  You might think it fair to also ask the question – why would someone make such a ridiculous assertion?  Other than base ignorance and stupidity, is there a hidden agenda item?

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