Key aspects of the current and future automotive industry

What drives forward R&D for vehicle and powertrain ?

In the automotive industry, the research and development (R&D) of new powertrain and vehicle architectures is driven by a combination of three main factors:

  • legislation
  • customer needs
  • fuel and raw material prices

The legislation is a set of rules and regulation set up by ruling bodies (European Union, governments, etc.) which describes the conditions that must be met when selling a car, in terms of:

  • harmful emissions (HC, NOx, PM, CO)
  • greenhouse gasses (CO2)
  • safety (ABS, ESP, etc.)

The customer needs are represented by a series of expectations and requirements, which shape the decision of a customer when buying a car:

  • acquisition price
  • performance (top speed, 0-100 kph acceleration time)
  • fuel efficiency
  • environmental impact
  • new technology
  • multimedia (Bluetooth connectivity, internet)
  • total cost of ownership (TCO)

The fuel and raw material prices are playing a key role in the strategic decision of the automotive OEMs. For example, the oil price has a big influence on the R&D budget for new powertrain development.

Historical oil price (WTI crude) at New York Stock Exchange

Image: Historical oil price (WTI crude) at New York Stock Exchange
Credit: Nasdaq

The oil price has also a major influence on the total cost of ownership of a vehicle. Higher fuel prices can play a key role in the decision of a customer, regarding the acquisition a plug-in hybrid electric vehicle (PHEV) or a pure electric vehicle (EV).

The fuel price criteria can have a bigger or lesser impact on the overall decision of the customer, depending on the class / segment of the vehicle. For Economy and Family class vehicles, the fuel price combined with the fuel efficiency of the vehicle, could be a decisive factor when purchasing a new vehicle. On the other hand, for Luxury and Sports class vehicles, the fuel price and fuel efficiency are less important, other factors being decisive: performance, comfort and brand image.

Automotive Council Technology Group Roadmap

The Automotive Council is an automotive organization established in 2009 with the main focus of improving and strengthening the dialogue and cooperation between the UK government and the automotive companies.

The Technology Group is Part of the Automotive Council and it’s main focus is to advise the Council regarding the future trends of automotive technologies. The latest Technology Roadmap publish by the Automotive Council dates from September 2013.

Passenger car low carbon technology roadmap

Image: Passenger car low carbon technology roadmap
Credit: Automotive Council UK

The technology roadmap is a key factor to consider when designing a new powertrain or vehicle architecture, because it estimates if the market will be ready for a particular technology. “Market ready” refers to the availability of the infrastructure for the new technology (e.g. charging stations for PHEVs and EVs) and customer awareness of the technology.

Hybrid electric vehicles are an intermediate step towards full / pure electric vehicles. Higher efficiency and ideal traction characteristics makes the electric motor the perfect candidate for vehicle propulsion. The only drawback of an electric vehicle (which is very important) is the energy storage system. Currently, state of the art battery technology offers inferior range and recharge time, when compared with an internal combustion engine powered vehicle.

Megatrends in the automotive industry towards new technologies

Vehicles are becoming more and more “intelligent”. The need for safer and more comfortable vehicles has led to the development of several technologies:

  • Advanced Driver Assistance Systems (ADAS)
  • interconnected vehicles & connection with the infrastructure
  • autonomous vehicles
Continental Automotive on ADAS, sensor fusion and tomorrow’s electronic braking systems

Image: Continental Automotive on ADAS, sensor fusion and tomorrow’s electronic braking systems
Credit: Continental

ADAS consists of a series of hardware components (RADAR, LIDAR, GPS receivers, video cameras, parking sensors, etc.) and software algorithms which enhances the safety and driving comfort of a vehicle. A vehicle equipped with ADAS technology should be capable of performing, as example, these functions:

  • Adaptive Cruise Control (ACC)
  • Lane Departure Warning
  • Blind Spot Monitoring
  • Collision Avoidance Systems

ADAS has also the potential of improving the fuel efficiency of the vehicle, by enhancing the usage factor of particular driving modes of the vehicle (e.g. Coasting, Sailing).

Continental with eHorizon road data information

Image: Continental with eHorizon road data information
Credit: Continental

By interconnecting vehicles (making possible the data exchange between them), the vehicle driving experience can be improved further. A vehicle equipped with ADAS technology can detect hazardous situations along the road (e.g. damaged road, oil spills, etc.) and inform other vehicles about it. This way the driving conditions (e.g vehicle speed) can be adjusted in order to avoid possible accidents.

eHorizon technologies means using road parameters (speed limit, slope, curvature, etc.) to optimize the energy usage of the vehicle and to predict future driving conditions. These technologies are already in place and they will become standard in the near future.

There are also research activities regarding connecting the vehicles to the infrastructure. This will further improve the energy efficiency of the vehicles, by predicting the driving conditions on a particular road (stop light, average speed, etc.)

Based on these technologies (ADAS and interconnected vehicles) the development of autonomous vehicles becomes possible. In an autonomous driving scenario, there overall control of the vehicle is managed entirely by electronic control units, there is no human driver, just passengers.

BMW Group Launches Car Sharing Service DriveNow

Image: BMW Group Launches Car Sharing Service DriveNow
Credit: BMW

Mobility is the new trend starting to shape up, in which a car is just a mean of transport. The perception of humans relative to car owner ship is changing fast. If, for the generation born between 1950 – 1970, turning 16-18 years of age and having a drivers license was a proof of passing to adult life, for newer generations (after 2000), having a car is no longer a priority or a target.

In 1978 approximately 50% of the 16 years old and 75 % of the 17 years old had license in the USA. By 2008 the figures dropped to 31 % and 49 % respectively. Younger generations, used with smart phones and game consoles are not anymore interested in owning a car. For them, vehicles are seen just as a mean of transportation and not an achievement in life.

As we speak there are major shifts in the automotive industry in terms of technology and customer expectations. Vehicle manufacturers have to adapt to the present and prepare for the future in order to ensure the survival of the business.

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