The electrification impact beyond cars

Issue #272

The impact of electric vehicles (EVs) or electrification of mobility goes beyond the urban mobility or car industry. President-elect Donald Trump's transition team for example is planning to kill the $7,500 consumer tax credit for EV purchases as part of broader tax-reform legislation. Faced with the massive cost of getting electric, flying aircraft approved by regulators and then building up manufacturing capabilities, some investors are bailing out. Komatsu plans to expand production capacity for batteries at its US unit by four times, eyeing the mining industry's growing push toward electrification and decarbonization. Yamaha motors has stated in its recent report that it is “slightly behind schedule” in developing and expanding sales of battery electric vehicle (BEV) offerings, but has other plans too. The Chinese city of Zhengzhou, a top?global producer of iPhones,?is undergoing a seismic industrial shift as automakers build an EV?supply chain in the area. Despite record profits in 2023, automakers in the US face challenges: the need to invest billions into software and electrification. Below are some interesting developments in the EV area beyond just their manufacture and usage.

Tax reform and EV incentives

President-elect Donald Trump's transition team is planning to kill the $7,500 consumer tax credit for EV purchases as part of broader tax-reform legislation, two sources with direct knowledge of the matter said. Ending the tax credit could have grave implications for an already stalling US EV transition. - Reuters

Funding for e-flying taxis

One of the innovations at this year's Paris Olympics was supposed to be an electric flying taxi service. Germany's Volocopter promised its electric-powered, two-seater aircraft, the VoloCity, would be ferrying passengers around the city. It never happened. Instead the company ran demonstration flights. Behind the scenes a serious issue was playing out - Volocopter was urgently trying to raise fresh investment to keep the firm going. Talks to borrow from the government failed. Now hopes are pinned on China's Geely, which is in talks to take an 85% stake. Faced with the massive cost of getting such novel aircraft approved by regulators and then building up manufacturing capabilities, some investors are bailing out. - BBC

Electrification of mining trucks

Komatsu plans to expand production capacity for batteries at its US unit by four times, eyeing the mining industry's growing push toward electrification and decarbonization. The heavy equipment maker last year acquired American Battery Solutions (ABS), which develops and makes lithium-ion battery packs for use in trucks, buses and other commercial vehicles. Komatsu plans to invest $65 million into ABS to expand production capacity to an annual 2.6 gigawatt-hours by 2026 from the current 0.6 GWh. - Nikkei Asia

Carbon-neutral fuels for less carbon emission

Yamaha motors has stated in its recent report that it is “slightly behind schedule” in developing and expanding sales of battery electric vehicle (BEV) offerings worldwide but is moving development forward now with a “keen sense of?urgency". However, the company maintains that BEVs are not the sole solution to becoming carbon-neutral. Technological innovations in hydrogen, biomass, synthetic fuels, and other carbon-neutral fuels make it possible to reduce CO2 emissions with internal combustion engines as well. - ET Auto

From iPhones to EVs

The Chinese city of Zhengzhou, a top?global producer of iPhones,?is undergoing a seismic industrial shift as?BYD and other automakers build an EV?supply chain in the area while Apple moves some smartphone manufacturing?to India. A BYD plant in Zhengzhou was bustling in late October as new cars were loaded onto trailers and shipped off one after another. - Nikkei Asia

Cost of cars in US and electrification, software

Despite record profits in 2023, automakers in the US face challenges: the need to invest billions into software and electrification as well as a global landscape where Chinese and other foreign automakers can produce cars much cheaper. Some Chinese startups that make EVs and plug-in hybrids have a 30% cost advantage over established global automakers, even without government support, according to research firm AlixPartners. Automakers can’t rely on protectionism measures such as tariffs to bring costs down. - CNBC