What the US Automotive Industry Can Look Like in 2015 and 2020 - Part Two

At the beginning of the 20th century there were dozens of car companies The story of the last century is one of consolidation so that by the 1990s there were only the Big Three and a few foreign companies producing vehicles in the US These companies from the last century will continue as the scale part of the business for the next 510 years They will be joined by smaller more nimble companies that will bring innovation to the marketplace Tesla and Aptera mentioned in the last column are just two examples There is a real possibility that there will be dozens of companies by 2015 The new companies will not provide scale at least initially but they will lead the market with innovation Some companies may produce hundreds of vehicles others thousands others tens of thousands These companies will successfully compete with the big companies on the playing field of innovationClearly the cars produced in the next 1015 years will be generally smaller much more fuel efficient and will use less and less gasoline The first stage is small internal combustion IC engine cars and small hybrid cars such as the Prius that utilize gasoline and electric batteries These will be followed by electric dominant cars that have very small IC engine used only to charge the electric batteries when the power is low Then there will be the pure electric plugins that are electric only These vehicles will provide 50 miles per charge which is sufficient as half of the US public drive less than 40 miles per day All of these different power trains will also show up in public transportation and trucksThe initial limitation will be how many can be produced the scalability of production The second limitation will be the US landscape which has been created on the false premise of always cheap gasoline In other words unless you have a single family house with a garage the chances are high that where you park your car does not have an electrical outlet nearby A significant part of our landscape and certainly our cities will need to be rewired This rewiring will need to be a part of a larger more energy efficient and technologically innovative 21st century power grid The federal government will need to provide huge financial investment to rewire America intelligentlyThis wave of electric vehicles will be closely followed by the developing wave of hydrogen fuel cell vehicles These vehicles will have all the same attributes as electric ones they will use no gasoline they will not create greenhouse gases they will be able to be refueled at home and they will be quiet to drive all great attributes They also have the same problem that electric vehicles do which is the lack of a national infrastructure of chargingfuelingrefueling stations Again it is now time for the federal government to step up and spend tens of billions of dollars along side private investment to create the needed infrastructure to allow the automotive industry to move toward the goal of having a majority if not all Americans driving alternative fuel vehiclesThis is what the federal government has always doneamp160 In the 1930s the government largely funded the creation of hydroelectric energy in the US In the 1950s 1970s it funded the creation of the interstate highway systemamp160 If President Obama and the elected politicians in Washington truly want to gain independence from foreign oil they must invest in the 21st century transportation infrastructure The investment in relative terms is not that great A 10 15 billion investment a fraction of what the government has already given to GM would be enough money to establish an initial refueling infrastructure of hydrogen fueling stations that would be accessible within 2 miles anywhere in the top 100 metropolitan areas of the country That investment would in turn allow the private sector to both further build out this refueling infrastructure and to scale up production of hydrogen fuel cell vehicles dramatically lowering the price into the realm of affordabilitySo the federal government absolutely needs to make the right policy and tax decisions in the next two years if they mean what they say If they do then private industry will rapidly ramp up so that by 2015 there will not be a single IC only vehicle made in the USamp160 The average fleet fuel efficiency of the US automotive industry can be a 100 mpg or greater by 2020There is one final point that needs to be madeamp160 If the federal government does not fully commit to this vision of the future in the next two years there will be many hundreds of billions to be made by German Japanese Chinese and Korean companies as their governments have embraced this general vision and are supporting it Not doing what is clearly needed will mean an abdication of leadership allowing these other countries and their automotive industries to completely eclipse the US in transportation technology and innovation for decades to comeThe future is clear and within our grasp The private sector is ready to provide the necessary innovation Are our elected officials ready to provide the long term policy and funding to create the future we all wantDavid Houle is a futurist strategist and speaker He has always been slightly ahead the curve Houle spent more than 20 years in media and entertainment David can be contacted at DavidDavidHoulecomRead all Davidamp8217s MediaBizBlogger commentaries at David Houle MediaBizBlogger

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What the US Automotive Industry Can Look Like in 2015 and 2020 - Part Two

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