Consumer Discretionary

New Paradigms In Auto Industry

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<p>Improvement in the automotive industry is no longer incremental but exponential and sweeping. Powertrains for EVs or e-Axles is expected to take off as a new market, a third force behind the OEMs and their suppliers. As a deterrent for the sale of ICE vehicles, emission norms and EV sales targets are getting stricter in the U.S.A. Nissan has a lead in repurposing used batteries. If the driving range is the issue for battery driven electric vehicles, Britain and Germany are attempting overhead cables to power trucks on highways. The chip and battery material shortage is expected to continue throughout this decade. Only those who manage these two bottlenecks can emerge as winners. Here are some recent updates of sweeping innovations reported in the automotive industry recently.</p><p><strong>e-Axles as a third force</strong></p><p>The EV industry's horizontal division of development and production, already established in computers and other electronics -- is projected to challenge the vertical integration in the auto industry. A ready supply of hard-to-develop e-axles will, in turn, lower the hurdle to EV newcomers. The e-axle market is expected to grow. E-axles offer a way for a third force to break into the auto industry, after automakers and established suppliers. Powertrains account for an estimated 5% to 10% of production costs for electric vehicles. Parts makers that once supplied engine components for automobiles now see a new opportunity in e-axles. - Nikkei Asia</p><p><strong>The EV impact on the repair sector</strong></p><p>EVs are powering ahead in the UK, fuelled by government support and consumer interest. But what will the changing market mean for the automotive repair sector? EVs have an electric motor instead of an internal combustion engine, which means they have far fewer moving parts that can go wrong. That&rsquo;s great news for consumers, as EVs cost at least 30% less to service and maintain, according to research by data companies. But it puts a whole chunk of revenue at risk for the automotive repair sector, says Professor Peter Wells, director of the Centre for Automotive Industry Research at Cardiff Business School &ndash; Raconteur</p><p><strong>Nissan's lead in repurposing used batteries</strong></p><p>&ldquo;Tesla, Volkswagen and others are introducing EVs but they are still far from receiving batteries,&rdquo; Joji Tagawa, Nissan&rsquo;s chief sustainability officer, said in an interview. &ldquo;We have a lot of return batteries and we have made a lot of trial and error on which battery will be used for which purpose.&rdquo; Through 4R Energy, a joint venture between Nissan and trading house Sumitomo created the same year the Leaf was launched, the carmaker has studied various ways of repurposing batteries to generate renewable energy in homes and buildings as well as for emergency power during natural disasters. The Leaf itself is made of materials that are 99 percent recyclable. - Financial Times</p><p><strong>EV sales up to 40% in the U.S. by 2030</strong></p><p>U.S. President Biden will set a new national target for the adoption of EVs, calling for them to represent 40% to 50% of all new auto sales by 2030. The target is expected to be supported by GM, Ford, Stellantis and other automakers. Executives from each of the Detroit automakers are scheduled to attend an event Thursday at the White House. Though the president will sign an executive order, the sales target is not mandatory. Instead, the document encourages the U.S. auto industry and government to promote legislation and the adoption of EVs. The target includes zero-emission vehicles powered by fuel cells and batteries as well as plug-in hybrid models with internal combustion engines. - CNBC</p><p><strong>Overhead cables for trucks on highways</strong></p><p>There&rsquo;s a debate over how to make the trucking industry free of emissions, and whether batteries or hydrogen fuel cells are the best way to fire up electric motors in big vehicles. Following Britain, Germany is looking at a system that feeds electricity to trucks as they drive, using wires strung above the roadway and a pantograph mounted on the cab. The technology saves weight and money because batteries tend to be heavy and expensive. At another level the idea is insane. Who&rsquo;s going to pay to string thousands of miles of high voltage electrical cable above the world&rsquo;s major highways? - New York Times</p><p><strong>The chip and battery bottlenecks</strong></p><p>"The global car market is characterized by two bottleneck factors up to the year 2030. On the one hand, there is a shortage of semiconductors which will have an impact until the beginning of 2023, and then an important battery cell availability problem,&rdquo; said Professor Ferdinand Dudenhoeffer, director of CAR (Centre for Automotive Research). CAR said global sales will get back to 2018&rsquo;s record high of 84.4 million in 2025. - Forbes</p><p><strong>Infosys Knowledge Institute series on sustainability</strong></p><p>Infosys Knowledge Institute has started a series of posts on sustainability and circularity.&nbsp;Urban mining is a big opportunity to implement a&nbsp;circular economy&nbsp;by mining valuable metals lying in our garages and attics inside electronic devices and gadgets. To read future posts, stay updated, and know about the upcoming book on &ldquo;Practical Sustainability&rdquo;, please follow&nbsp;Infosys Knowledge Institute on LinkedIn.</p><p><strong>Social media influencers for EV sale</strong></p><p>Several automakers in China now have multiple new-energy vehicle brands, each targeted at a slightly different customer segment. EV adoption is accelerating at a startling pace. Carmakers are increasingly using influencers to cut through the clutter. Their preferred messengers: media-savvy young people who use social platforms to talk about and review EVs to legions of followers that stretch into the hundreds of thousands. That makes sense because, rather than dealing solely with a dealership, many EV buyers in China browse online, interact with an influencer, or perhaps go to a high-end mall to view the finished product in a boutique-like setting&mdash;all before visiting a dealer lot or ever getting behind a wheel. - Bloomberg</p><p>&nbsp;</p><p>&nbsp;</p>
KR Expert - Ramachandran S