Firstly lets relish some bastardised Shakespeare..
Electric Vehicles “to be?” or “do what do you really want them to be?” That is the Question?
If there ever was an adage that fits these: “people don’t want to be helped, leave them alone”, “become servants without ideas,” and making a case for solutions being bespoke and decentralised. Then the UK EV strategy is the perfect case study. (*1)
I am interested in the success of the UK automotive industry because its where i cut my teeth, and hate to see those dreadfully tough times and achievements go to waste.
More recently, I have bored people stupid about the psychology of why technology, ideology, over simplification, and dialogue gets technology strategy, in particular in a mess,
Its interesting that most don’t get the psychology aspects driving this, yet that’s the core of the infection that’s preventing getting or preventing good strategy happening super fast.
EV strategy have turned out to be this perfect storm..
Anyway, we are where we are, the legislation banning sale of non EVs by 2030 is creating the perfect window for China to trash our industries. EVs en-masse will make our race to decarbonise worse too, our economies poorer, so more incapable to fund the right decisions as well!
Whilst we must create EV platforms, as there is a narrower and narrowing source of differentiation between EVs and ICE vehicles, with China’s dominance, and without a macro strategy, it’s unlikely that this industry will ever make any money at all. This loss-making is why China love EVs, EVs provide the perfect strategic industry to attack Western Industry.
Note the backdrop too: China has accelerated their plans up to 2030 to accelerate their consumption of fossil fuels, (to trash our industries), whilst we innocently play like kids by our Marquis of Queensbury #zerocarbon rules.
Personally, I would not drive an EV – high cost, and the catastrophic fire that ensues in the case of an collision due to the thermal run away of shorting a Li-Ion battery.
So, electric vehicles are a paradox. They do have a role in a transport infrastructure.
But the strategic bases are flawed:
· Consumers don’t want them. (*1)
· They trash the planet because you consume 70% of the Co2 footprint of an ICE vehicle in EV manufacturing so just by buying one, before you’ve even used an EV (*2)
· EVs are more efficient vs a ICE vehicle 80% vs 20%, but it’s the end – end carbon impact that matters.
· There are limited lithium availability and supply globally and not enough to fuel the industry for long.
· Geopolitical factors of lithium supply China own the sources of over 50% of lithium mines and 95% of rare earth metals that go into making the electronics.
· EVs are vastly simpler than ICE vehicles – so far fewer people employed in the supply chain.
· Development or Li Ion batteries is limited so trends to a race – bottom, unlike ICE vehicles which have far more variables and differentiation possibilities = $$profit opportunities.
· No one can afford EVS – so shared ownership and lock in is key using self-driving autonomous vehicles that you don’t own (its part of the #WEF utopia be happy own nothing mantra!)
· There is vast energy required to make the batteries and a giga factory uses single digits of power the consumption of countries, so a big deal. Investments are huge and strategic too.
Re EVs vs ICE No single producer dominates in oil and gas markets the way with EVs the Democratic Republic of Congo dominates cobalt, China dominates graphite and REEs, and Australia dominates lithium. Similarly, processing of these minerals — refining and preparing them for industrial applications — is highly concentrated, but mostly in one place: China, which processes around 40 percent of copper and nickel, around 60 percent of lithium and cobalt, and around 85 percent of REEs.
· The issue with carbon reduction is in China, and consumption, in the UK direct global Co2 is only 1.5% of global emissions of which vehicles are a small fraction of that 1.5%. Yet China have been allowed to accelerate their consumption of fossil fuels in the meantime to gain an unfair advantage to build these EVs.
· Using older vehicles makes sense as the damage has been done making them, they are paid for, and most are hardly used.
· Using EVs where air pollution is an issue make sense in built up areas!
· Using ICE for heavy goods and longer journeys / hybrid makes better sense
· Banning sale of hybrids in 2030 is naive because China are the only country organised enough to respond
· Car manufacturers too are not ready to switch by 2030 and supply chain decisions are being made now based upon where (capable) battery manufacturing is located or due to be located.
· We require Government strategy to keep China out yet Germany BMW/Mercedes are open to China Mini manufacturing and 10% Chinese ownership of Mercedes, and Nissan have a Chinese battery plan supplying Nissan. Yet the Japanese severely dislike China too.
· Power generation for charging EVs will become an issue; is there capacity. This will reduce our agency or control of the cost or choice of fuel?
· Where is the a global map for Lithium supply, its highly likely like Russian gas will we be held to ransom by nefarious countries such as China, Russia on nickel and cobalt etc? A UK Cornish Lithium mine was sold to China last year!
· Technology needs to catch up with usability: charging rates, recycling batteries, battery life, battery remove-ability, uncontrollable battery fires, infrastructure, safety of in accident fires, likelihood of fires as battery ages. There is no robust solution to battery fires due to the nature of dendrite formation and the difficulty controlling the key process variables.
· On pricing due to limited availability of materials and geopolitical factors – will lead to fundamental volatility in pricing and vulnerability to nefarious interests. This is in a context when relationships with China and Russia etc, and national self-interests are going the other way.
· Relying on future sources of lithium relies on places such as Afghanistan as a source.
· As an industry – the vehicle is a battery on wheels, the battery is key to cost and functionality, electronics are not really a differentiator, rest of the vehicle assembly is easy.
· Energy infrastructure costs must keep pace: power generation capacity, home charging, regional charging stations.
· Cheap energy as well as lithium is critical to EVs. China with their increased use of fossil fueled / coal fueled power stations up to 2030 makes a nonsense of the Wests strategies, and will trash the competitiveness of the Western manufacturers. Battery factories fundamentally use huge power which is also required in upstream processing of the lithium.
· More technology won’t change these fundamentals, polymer batteries are safer don’t catch fire but have nothing like the energy density.
· Setting up a battery factory is a start up on drugs, major orchestration and value adding is required, because parallel tech must be looked at in these factories. So battery factory designs must modular in principle, with partnerships and orchestration of the OEMS and other powerful entities at the centre, else the OEMs could invest, usurp and create these partnerships directly themselves?
In terms of the freedom and convenience of EVs: we don’t have agency over these choices. I have discussed how ideologies lead to tyranny and an acceleration of these 1 way streets and supporting actions, even when the strategy will lead to a car crash.
Medium term Issue to consider
· China broadly are the only country to have mass manufacturing of Li Ion batteries nailed, apart from Tesla in the USA
· China are trashing pricing already on Tesla
· China have intentional strategies of profitless growth which are impossible to compete with
· China don’t play by Marquis of Queensbury’s rules their defiance and increased use of cheap Coal power to fuel their industries
· China manufacturers dominate over 50% of the EV products at car shows now
· IP creep with partnerships with China. StoreDot has China manufacturing partnerships so IP loss is a real risk
· Resourcing these business models is difficult, battery plants must be THE major technology and commercial orchestrators – with: ambitions and speed far greater than before; no time for delays; major partnerships with startups; vendors and OEMS; management long term and short term; massively punching above weight. They must be so successful so as to earn the right to influence Gov strategy – timing; legislation, keeping nefarious interests such as China out and friendly countries in.
· Battery design development requires fast charging, no fires, removability, energy required to make, recycle-ability, lifespans vs charge rates, lifespan vs overall, reusing batteries.
· Legislation is required to limit China inward investment, penalise China using their dirty energy, massively counterproductive!
· As the EV market will have to be shared ownership, we are introducing a tyranny reducing our agency and freedom of choice and choice of independence from these technology companies for our transport. Chinas are the experts at these intermediator rental business models, and are happy to fund huge underutilised working capital required to make EVs mainstream when the West won’t. This business model doesn’t fit the Wests financial investment / ROI criteria, even BV had zero interest from UK investors.
· As is, EVs will fuel conflict, captive supply relationships and dependence, between nations and China not build alliances.
· Will the non-Chinese players be forced to do deals with the devil? Germany are deepening their trade ties and automotive manufacturing to China. ESG KPIs will force these links too. Why when Germany could have learned from Russian gas dependence, and China ultimately are a far bigger threat than Russia.
· China growth relies on pillaging and controlling our economies in this way, as their birth rates don’t support their economic plans from a home base
· China will start exporting their own products not just EVS, which is the devastating phase 5 of the Chinese strategy.
· The West without an healthy significant automotive industry that makes money or a vastly simplified supply base vs ICE vehicles wont have the critical mass in the infrastructure to support other manufacturing industries?
· Aerospace industries will be next. China have bought up quite a few UK 1st tier supply companies Gardner Aerospace and others.
o Electrification / H2 power of aircraft is another issue altogether.
· History suggests that China will strike when the competition is on their knees. In this case China, have launched their attack on the automotive industry right from the start, which is concerning, so may have won already?
The question is whether you have the integrity live David to avoid the devil or like Solomon do a deal with the devil. In the case of the latter, I think the outcome will be a loss of national sovereignty and key nations losing control to China because reducing national wealth weakens governments and nations.
Rather than invest and focus on manufacturing, the UK government strategy to (parasitically) fuel big tech, big tech, will trash our other financial and retail etc service industries, and open us to unstoppable cyber-attacks from China (China control AI and Quantum – the capability drivers of unstoppable cyber-attacks.) So de-digitising industries creating a fall back, will be critical to close the cyber door.
There is a place to get this right, but several years have now in the UK have been wasted. More of the same approach won’t fix the issue. The infection of psychology of blaming the government or anyone else must be rooted out from the start.
Getting to grips with the psychology that is driving this is really the issue to become aware of and resolve, here which I explain in my these books, the cost of denial, inaction and these misalignments which we now have to face head on.
This EV race is escalating.
EVs do play a part in a sensible strategy but definitely not THE ONLY basis of an entire transport strategy, ICE vehicles do ongoing too and the issues around freedom and affordability is not an acceptable compromise nor is the loss of this consumer agency. Else if unchecked that agency be decided upon by China with the Tesla’s of this world collapsing due to lack of profits, and or inability to be independent of China too.
Because this process of transitioning to EVs is accelerating we will trash the planet faster too (*2).
Let’s make it happen, lets talk, I have action plans in motion.
This is a useful background report on raw materials aspects
or click above – lets make 30 mins
PS As an engineer, I don’t have time to write prose like Shakespeare, but the intention is that this might help interested people think through the issues to inform the discussion and complexity of the challenge