“Electric Avenue” Shows Preoccupation With Battery Power
Ford Unveils New Focus, Honda Introduces Zippy Little Hybrid
With two of the former Big Three U.S. manufacturers GM and Chrysler emerging a little sheepishly from bankruptcy, the mood at the 2010 Detroit Car Show is understandably understated.
Ford, which to its credit managed to avoid carrying its begging bowl to Washington, has muscled GM out of the way in terms of floor space at the Cobo Arena here in downturn Detroit, and has expanded its show space by almost 50 per cent. Chastened GM has no need now to house dumped brands Pontiac, Saturn, Hummer and Saab. Chrysler now shares space with its new mentor Fiat.
House of Representatives Speaker Nancy Pelosi was striding around the show on the first media day, presumably to make sure U.S. charges GM and Chrysler weren’t being extravagant with taxpayer’s money. She was probably happy.
Pelosi, as a high-profile backer of President Obama’s decision to raise fuel economy stands by 2016, must have been pleased to see Electric Avenue, where many of the world’s top manufacturers were showing off their battery, plug-in hybrids, extended range electric vehicles, and just plain old hybrids.
Unfortunately, this coincided with a report from Boston Consulting Group saying electric vehicles are unlikely to become high-volume mainstream products by 2020 because of stubbornly high battery costs. The report said automakers are unlikely to reach a long-term goal of $250 per kilowatt hour for lithium ion batteries, down from the current price of between $1,000 and $1,200 per kilowatt hour.
This sounds like bad news for Renault-Nissan, which has invested heavily on the back of its belief that battery-only vehicles will account for 10 per cent of global sales by 2020. Many forecasts think even up to two percent is unlikely.
But the report did say that by 2020, 26 per cent of vehicles sold in major developed markets will have some form of battery power. That would add up to about 14 million vehicles. The vast majority – about 11 million vehicles – would be hybrids. Electric vehicle sales would reach only 1.5 million. The rest would have some sort of onboard way to recharge the batteries.
High profile launches at the show included the 2012 Ford Focus, which will replace both the European and U.S. versions, and the Honda CR-Z, a two-door sporty hybrid powered by a 1.5 litre engine. Mercedes unveiled the convertible E class, which will replace the CLK. GM’s Cadillac introduced the new CTS-V coupe. Volkswagen and Toyota showed hybrid concepts. Audi, BMW and Fiat took the wraps off electric-only cars. Chrysler had nothing new to announce., although it did show a Lancia Delta with a Chrysler face.
Adding to the gloom was a forecast from the German automotive industry association VDA that U.S. light vehicle sales may only grow by 10 percent this year to 11.4 million units, less than the consensus expects.
“We have set our forecast intentionally lower,” VDA President Matthias Wissmann told a press conference in Detroit.
Citigroup estimates 12.5 million light vehicle sales in the U.S. this year.
The VDA said Mercedes and BMW should be able to grow faster than the market as new models such as the E class convertible and the upcoming BMW 5 series hit showrooms and car buyers increasingly purchase clean diesels such as Volkswagen’s Jetta TDI. Diesel sales tripled to 42,000 in the U.S. last year, according to the association.
He expects German carmakers to sell more than 800,000 vehicles in the United States this year, up from 763,000 in 2009. Total market share rose 0.6 percentage points to 7.3 percent last year.
Neil Winton – January 12, 2010