Technology to watch, COP28, global sales - the week in Auto

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What are the technology themes keeping senior executives up at night? And what are their investment priorities for 2024? Despite geopolitical turmoil and economic uncertainty in 2023, technology investment continued to grow significantly, underlining a common belief that the world’s greatest innovations have been born in times of great economic and political stress. With this in mind, Verdict this week looked at some of the top technology investment trends to watch in 2024.

COP28

What does COP28 mean for the auto industry? Well, for one thing, EVs are a bright spot. The circus in Dubai has finished. It was quite a gathering. Some 75,000 people attended and there were a lot of words written and broadcast in the media. Has it achieved much? People will continue to discuss and argue of course. Besides the data and the severity of the climate crisis humanity faces, arguments will rage about what actions make the most sense – and who needs to step up, pay for it – and how urgent things really are. Much is being made of the language in an agreed final text. It was agreed by 198 countries, so some softening was perhaps inevitable, but it does – for the first time – point to the role of fossil fuels in the global warming crisis. It calls on nations to ‘transition’ away from them, but doesn’t go as far as calling for them to be phased out. There’s a big discussion to be had about the cost of such a transition and how poorer countries can be helped with that. On the plus side, there are commitments being made and the direction of travel is there on renewable energy sources displacing fossil fuel sources – even if it can’t happen immediately. Also, technology and scale economies are making renewable solutions cheaper – over time – than oil and gas. The hope has to be that the laws of basic economics will move the dial towards more renewables as they become cheaper to deploy.

Product tech

Who would have predicted 30 years ago, when BMW introduced a new petrol V8 for its flagship 7 series that, several generations later, the technology leading masterpiece would be an electric? Times change. During our time with the car, we barely scratched the surface. We also took a look at an interesting new Polestar model which, rare these days, has switched from front wheel drive to rear.

Global sales

The Global Light Vehicle (LV) selling rate for November was 94 million units/year, slightly lower than the upwardly revised October figure of 95 million units/year. The market was up 14% YoY and in YTD terms 82 million vehicles registered, 11% higher than YTD Nov 2022. US sales were helped by agreements being settled between the Detroit 3 OEMs and the union, ending the strikes, along with increased incentives during Thanksgiving and Black Friday. China’s market in November also benefited from heavy incentives and discounts by OEMs and dealerships. Meanwhile, European regions continued their recovery. With supply constraints fading, adverse macroeconomic headwinds are a concern heading into 2024.

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China overcapacity

Despite 2023 being – overall – a good year for China’s automobile market, overcapacity is becoming hard to ignore. Due to the ongoing vigorous price war, 2023 will turn out to be an exciting and high-profile year for China’s automobile industry. From leading brands to niche brands, from new energy vehicles (NEVs) to internal combustion engine (ICE) vehicles, fierce competition has occurred throughout the year. China’s light vehicle (LV) production total has ranked first in the world for 14 consecutive years and is expected to account for 32% of the global total in 2023. NEV production and sales have ranked first worldwide for eight consecutive years. China’s production has reached 1.7 times that of Europe, in second place.

HVAC growth

Automotive heating, ventilation, and air conditioning (HVAC) systems have undergone a transformative shift with manufacturers emphasising green technology for enhanced environmental sustainability and cost effectiveness. To align with rigorous government emission regulations, market competitors are actively producing eco-friendly HVAC products. The surge in energy efficiency, coupled with strategic mergers and acquisitions, is driving market growth. Amid rising global warming concerns, the Asia-Pacific (APAC) automotive HVAC systems market is anticipated to post a compound annual growth rate (CAGR) of 2.3% over 2023-28, forecasts GlobalData, a leading data and analytics company. GlobalData’s latest report, Automotive Heating, Ventilation and Air-Conditioning (HVAC) Market Trends and Analysis by Technology, Companies and Forecast to 2028, reveals that the APAC automotive HVAC systems market is estimated to grow from 45.3m units in 2023 to 50.8m units in 2028.

Battery recycling

SK Ecoplant Company said it had completed construction of its second battery recycling plant in China to meet rising demand from the country’s fast expanding electric vehicle (EV) market and well as from used electronic products such as laptops and smart phones. The new plant, in Jiangsu province, has annual processing capacity of up to 2,000 tonnes of black mass, or shredded material derived from used battery cells containing minerals such as lithium, copper, cobalt and nickel. The company already has a battery recycling plant in Shanghai and is scheduled to complete expansion of the Jiangsu plant by the end of 2024, doubling its capacity to 4,000 tons per year.

Tesla ‘recall’

Tesla will repair over 2m vehicles, its biggest recall, after the US auto safety regulator determined the driver assistance system Autopilot doesn’t do enough to guard against misuse. Bloomberg said the move was the result of a years long defect investigation which the National Highway Traffic Safety Administration would keep open to monitor the effect of Tesla’s fixes. A NHTSA spokesperson told Bloomberg the probe found Tesla’s means for keeping drivers engaged were inadequate. According to Bloomberg, Tesla said in its recall report it expected to start deploying an over the air software update to incorporate additional controls and alerts on or shortly after 12 December. The recall is the second this year involving Tesla’s automated driving systems.

Bulgarian batteries

Belgian battery manufacturer Avesta Battery & Energy Engineering (ABEE) plans to invest EUR1.1bn (US$1.2bn) to make lithium-ion batteries in Bulgaria over the next three to five years, Bulgarian prime minister Nikolay Denkov said, as quoted by state news agency BTA and reported by SeeNews.com. The investment project would be among the largest in Europe and envisioned opening plants in Stara Zagora, Plovdiv and Burgas, BTA reported. It was expected to create over 1,000 new jobs. The reports said ABEE intends to open a research and development (R&D) base in Plovdiv and build a lithium-ion battery factory in Stara Zagora, producing 10 gigawatts of solid state batteries annually.

By Graeme Roberts