Thoughtstarter – Are we moving towards a fully electric transport scenario?

Two huge milestones this week if you are tracking the speed we are moving to a fully electric transport scenario.

Volvo to use electric motors in all cars from 2019

You might criticise Geely for being backed by the Chinese government and therefore be able to make big high risk investments (like the purchase of Volvo in the first place) that listed carmakers reporting quarterly profits to Wall Street could not consider, but boy, you got to admire the cojones!

Not quite as dramatic as it sounds – they will still produce hybrid cars, but it still makes with the first conventional brand. Hard to see a global player making the same move, but why not experiementn with one brand that fits electric? RollsRoyce? Jaguar? Audi, to help erase the stain of the diesel emissions fraud? Lincoln? Cadillac? Low risk…that brand is dead in any case to the under 60s……..

Tesla’s Elon Musk says Model 3 set to be delivered on schedule

OK, Elon Musk talks a big game, but can he deliver on one of the biggest best in automotive history? Despite all Tesla’s hobbies and distractions, this is a great sign that Tesla is putting its persistent operations issues behind it. No-one has doubted that they are able to design great cars, but before now they have never been able to make them at scale….if they can keep this up, and make money too, the mass market brand will have to copy.

If you have done a scenario planning exercise for the future of the automotive industry, you know that there are two huge disruptions for incumbents that will turn their industry upside down and many will not survive – Electric Vehicles and Autonomous Vehicles. They can be evaluated separately – Electric vehicles will disrupt on a 5-10 year horizon, whereas Automated Vehicles will disrupt on a 10-20 year horizon.

These two announcements shift the odds firmly towards the earlier of these dates, and all strategic planners should reconsider whether they are investing enough to be ready.

 

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