“I believe mandates don’t make markets,” said BMW Group’s head of steering government, external affairs and sustainability Andreas Klugescheid.
“Let’s say the government decides the country needs to have a certain number of EVs. But the customer will ask - why should I buy an EV?,” he asked on the sidelines of the recent third E-Mobilia World, which was a partner event at the 2015 International Greentech and Eco Products Exhibition & Conference Malaysia (IGEM), held at the Kuala Lumpur Convention Centre.
To explain his view, Klugescheid spoke about the difference in the ways that the state of California, United States and Germany promoted electric mobility.
“In California, which has a population of 39 million, there are 150,000 EVs on the road. In Germany, which has a population of 80 million, there are 40,000 EVs. So, why is California more successful in encouraging EV sales?,” he asked.
The answer, said Klugescheid, was in giving incentives to car buyers.
“In the typical American manner, California looked at the point of sale - where’s the money? There is a state tax break of US$2,500 which is on top of a national tax break of US$7,500 for EV buyers. So, for example, if you buy a US$30,000 Nissan Leaf, you get US$10,000 back.”
Klugescheid also noted that successful EV adoption in California was also due to Californians being more accepting of new technology and concerned about air pollution.
“In the past, Los Angeles had a bad smog problem. People in California, which is home to Silicon Valley, are also more keen on new technology.”
As for Germany, he said Europe’s largest economy did everything right except incentivising the customer.
“In a typically German way, we decided - let’s do strategy. So, we set up a National Platform for Electric Mobility. Then, we formulated a goal of one million EVs on the road by 2020. And, we have to do research - understand the potentials in terms of industry policy, battery manufacturing, user behaviour, how to integrate renewable energy into the grid, etc, etc.”
Klugescheid said wryly, “What we didn’t do, was directly incentivising the customer. There is a vehicle tax break for EVs, but given that German car taxes are relatively low, this is not really important for the German EV buyer.”
BMW Group’s head of steering government, external affairs and sustainability Andreas Klugescheid.
Concerning the relevance of hybrid cars and EVs in the present era of cheap oil, Klugescheid pointed out that the driving force for green cars is still regulations on carbon dioxide (CO2) emissions.
“Oil prices go up and down, depending on factors like politics and wars. Fossil fuel resources will end one day. But, 95% of the markets that BMW operate in have CO2 regulations which are getting more stringent. So, electrifying our drive trains continues to be a key research area.”
Steep rise in global EV sales
Klugescheid’s bullish view on electric mobility is supported by high global sales of EVs.
According to the Global EV Outlook 2015 report by global forum Clean Energy Ministerial (CEM), electric cars on the road have risen from 180,000 units in late 2012 to 665,000 units at end-2014.
The United States has the most EVs on the road (39%), followed by Japan (16%) and China (12%).
Sales is growing rapidly, rising from 45,000 EVs sold in 2011 to more than 300,000 sold in 2014.
The CEM report also said it has become easier for drivers to recharge their vehicles, as countries expand public charging infrastructure.
It also noted that since 2011, EV batteries’ cost has dropped by about 50% and energy density has also risen, which in turn improves EV travel range — a key consumer concern.
Klugescheid also highlighted BMW’s eDrive technology, used in all electrically powered cars and plug-in hybrids from the German premium automaker.
BMW eDrive spans the electric motor, the lithium-ion high-voltage battery and the power electronics.
At the 2015 Frankfurt Motor Show, BMW premiered the eDrive models of its 2, 3 and 7 Series and X5 SAV (sports activity vehicle).
Electro-mobility research in Singapore
Also present at the third E-Mobilia World was BMW director of future mobility research Dr Felix Klanner, who highlighted BMW’s collaboration with Singapore’s Nanyang Technological University (NTU).
NTU is among eight universities in the world that BMW work with, for research and development projects. Others include Tsinghua University in Beijing, and Massachusetts Institute of Technology in the United States.
“We turn ideas into nuts and bolts,” said Klanner.
BMW director of future mobility research Dr Felix Klanner.
The Future Mobility Research Lab on the NTU campus is BMW Group’s first joint laboratory in South-East Asia.
The lab carries out research in electronics, powertrain technologies, and mobility habits and concepts.
In June this year, the co-funded lab received SGD$1.3mil to drive new research projects, on top of the initial SGD$5.5mil given two years ago.
The lab uses the all-electric BMW i3 and plug-in hybrid sports car BMW i8 as research platforms.
Klanner said Singapore was chosen as a research venue as it is a densely-populated city state.
“We can gain insights on the driving behaviour here, and improve EV technology for global megacities.”
