Navigant Research Blog

With Its E-Motorcycle, Harley-Davidson Outdoes the Automakers

— June 20, 2014

This week Harley-Davidson unveiled a battery-powered electric motorcycle concept, called the LiveWire, that has surprised the transportation world.  Crankshafts, engine oil, and the smell of gasoline are all integral parts of the Harley-Davidson identity, so most expected the company to be dragged kicking and screaming to the electric vehicle (EV) party.  Instead, Harley revealed a concept vehicle that’s better looking, better designed, and might one day be better selling than most automotive company attempts at EVs.

First, a personal detour: I’ve never been a fan of Harley-Davidson.  Its motorcycles are beautiful to behold and intimidating to hear.  But I’ve always disliked the design ethos of a company that decides to sacrifice performance in order to cosmetically alter the sound that a machine makes.  Harley-Davidson’s notorious engine rumble comes from the single pin engine design that can’t match other performance bikes on speed and torque.  Additionally, Harleys are tuned to have a low idle speed in order to give them a more distinct popping sound when not moving.  This, in turn, leads to excessive wear and tear on the engine, leading to lower expected lifetimes of Harley-Davidson engines compared to their peers.

Lag Gone

Which is why I was surprised to view the videos of the electric concept bike.  Instead of trying to market a machine for environmentalist two-wheelers, the company designed a bike for its core market: people who love motorcycles and the power and freedom they represent.  The drivetrain design provides 52 foot-pounds of torque, which for a vehicle that weighs less than 500 pounds is like strapping a Scud missile to a Smart Car.  The resulting power allows the machine to reach 60 miles per hour in less than 4 seconds.

Motorcycle reviewers note the other element of EV drivetrains that can’t be matched by internal combustion engines: instantaneous torque.  An electric motor responds to the driver’s command immediately, with zero torque lag.  Even the most expensive Ferrari or Lotus has a noticeable buildup to full torque, which is inherent in the nature of how combustion drivetrains work.  I’ve noticed instant torque when driving the Chevrolet Volt and Nissan LEAF – albeit much less dramatically than it probably feels on the Harley LiveWire or the Tesla Roadster.

Sound and Fury

Harley-Davidson has done something that no other incumbent vehicle manufacturer (we would expect EV-only companies like Tesla Motors, Brammo, and Zero to get these things right) has tried to do: it has built an EV around the strengths of the drivetrain.  There are, of course, weaknesses too (most notably a 30- to 60-mile range and a 3-hour recharge time), but in the end people like their motorcycles (and cars) for what they can do and are willing to live with the compromises that have to be made for what they can’t do.  Here’s hoping that the design executives from the major automakers take the LiveWire for a test ride and get inspired to make the next generation of muscle cars and hot rods – with electric drivetrains.

And how about the signature Harley-Davidson sound (which the company once unsuccessfully tried to trademark)? Well, this thing sure sounds different.  Thanks to the high frequency electric motor, it sounds more like a jet engine than a traditional Harley.  But it still makes you instantly respect and appreciate the power and fury that the bike is capable of.

 

Tesla Looks to Fuel a Battery Revolution

— June 18, 2014

Elon Musk, CEO of Tesla Motors, stunned the automotive world with his announcement that he was making all his company’s electric vehicle (EV) patents open source.  “Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology,” he said on his blog.  Musk explained that he decided to do this because the “world would all benefit from a common, rapidly-evolving technology platform.”

Automotive companies are well-known for developing proprietary solutions for almost anything in an effort to get one step ahead of the competition, even for a short time.  But this approach means that often the opportunity to share in the rapid growth of a new technology is lost, and suppliers can miss out on the potential for much higher volumes.  Some have speculated that this change in attitude to patents is a move to create bigger demand for battery cells from Tesla’s planned Gigafactory.

Weight and Range

Conventionally powered vehicles are still the main business of all major automakers, which are continually investing in new ways to make these vehicles more efficient.  One of the current trends is to develop stop-start technology to capture some of the efficiency gains of a full hybrid at a fraction of the cost premium.  Full details on the latest developments are discussed in Navigant Research’s 48 Volt Systems for Stop-Start Vehicles and Micro Hybrids report.

When designing an electric or electrically assisted powertrain, manufacturers have to weigh a number of characteristics for each particular model.  Not all hybrid vehicles and EVs are optimized for economy.  Some use the stored energy to boost power or drive an additional pair of wheels.  Bigger batteries cost more and also add weight and take up space, but they provide greater electric-only range.  Small, light vehicles can travel further per kilowatt-hour of battery capacity than larger, heavier vehicles.  These compromises are difficult to resolve, and battery manufacturers have a role to play.

Step Up

Anticipated sales of battery electric vehicles (BEVs) are projected to be large enough to lead the demand for lithium ion (Li-ion) batteries in the automotive world.  Even though sales numbers of hybrid electric vehicles (HEVs) dwarf those of plug-in hybrid electric vehicles (PHEVs) and BEVs, a much larger battery capacity means that at least 60% of the Li-ion batteries made for automotive use will end up in a BEV over the next couple of years.  That percentage will increase slowly until the end of this decade, after which stop-start vehicles will begin to influence the distribution.  Maybe this move from Tesla will be an incentive for the established carmakers to put more effort into their BEV product range.

Navigant Research expects that the overall market for vehicle Li-ion battery revenue will reach $26 billion by 2023, and that revenue could exceed that if newly emerging 48V micro hybrid technology delivers on its promise of fuel efficiency at a low-cost increment, and a significant number of original equipment manufacturers choose to implement it with Li-ion battery packs.  In addition, the expected steady lowering of per-kilowatt-hour cost will encourage the market if manufacturers pass the savings on to customers.  Full details of the automotive market for Li-ion batteries are covered in Navigant Research’s report, Electric Vehicle Batteries.

 

Brickyard City Hosts Carsharing Experiment

— June 10, 2014

Indianapolis, Indiana, is set to become the site of one of the biggest electric vehicle (EV) carsharing programs in the United States.  The Bolloré Group kicked off the “BlueIndy” carshare program, the company’s first in the United States, in May.  The Bolloré Group is large French conglomerate that, among other things, produces electrical components for capacitors and lithium polymer batteries.

Indianapolis is an odd choice for an EV carshare service location compared to a city like Paris, where Bolloré’s Autolib one-way EV service has been a huge success since its launch in December 2011.  Autolib was one of the first carshare programs to combine EV technology with the one-way carshare model, which allows users to drop cars off at any of the service’s designated parking spots.  The Autolib program has expanded beyond Paris and now has around 140,000 users across France.  According to Hervé Muller, the president of BlueIndy and vice president of Bolloré subsidiary IER, the cars in the Paris Autolib program are used an average of 7 times per day and the program is set to become profitable just 3 years after its launch. The company is now targeting the United States.

Charge Here

So why Indianapolis?   The city has limited public transportation, and its downtown, although quite suitable for hosting the Super Bowl, lacks the concentration of residential living that successful carsharing cities like Paris, Boston, and San Francisco have.  What it does have, though, is a mayor who made the carshare program one of his major priorities and an electric utility that stepped in to pay for charging equipment.

Setting up a public charging network fulfilled a key goal for Indianapolis Mayor Greg Ballard.  Indeed, this program demonstrates a creative way for a city to rapidly establish a charging network.  Bolloré will let other EV drivers use the stations, thus adding an additional revenue stream.

Bolloré has committed to bringing 500 Bluecar EVs and 1,000 public charging stations to Indianapolis. This represents a $35 million commitment from the company.  Indianapolis Power & Light (IPL) has also partnered to support the charging deployment, although there is some question about whether IPL can secure a rate hike to pay for it.  In my conversation with him, Muller said Bolloré expects the BlueIndy service could take up to 6 years to reach profitability and noted that the company is taking a long-term view of developing its U.S. carshare business.

Students and Tourists

It will be instructive to track how this service is used.  Typically, public transportation can be a key ingredient for successful carsharing services, because it allows city residents to get around easily, with the carshare filling in the transit gaps.  In Indianapolis, BlueIndy may essentially take the place of a widespread public transit network.  This is an advantage of the one-way model, with cars being easily used for short trips across town, for example.

The Bolloré Group is also looking to draw membership from the city’s large student population, travelers using the Indianapolis airport, and local businesses that could use the carshare program in place of fleet vehicles.  It’s an ambitious plan. Bolloré has yet to deliver its first U.S.-approved EVs and the program could take several years to reach viability. But if it works, the Indy experiment could serve as a model for other similar U.S. cities.

 

Shifting Its Fleet, Toyota Strives for ZEV Mandates

— June 9, 2014

In mid-May, the news broke that Toyota has, for the time being, backed out of battery electric vehicles (BEVs) in favor of plug-in hybrid electric vehicles (PHEVs) and fuel cell vehicles (FCVs).  The company ended production of the small Scion eQ in 2012, and will end production of the RAV4 EV in 2014.  The move is not much of a surprise, since the original plan was to sell only 2,600 RAV4 EVs in California from 2012 through 2014 to comply with the California Zero Emission Vehicle (ZEV) program.  Toyota now plans to stay in compliance by introducing its first FCV in California.  That will be Toyota’s only vehicle falling within the definition of ZEV, as defined by the California ZEV program.

The ZEV program mandates automaker development and deployment of a number of fuel efficiency vehicle technologies to California and seven other states.  A specific regulation mandates that large automakers must sell a minimum amount of ZEVs as a percentage of their total sales in these eight states or be fined for non-compliance. Vehicles falling under the ZEV definition are BEVs and FCVs, and automakers subject to this requirement as of 2013 include Chrysler, Ford, GM, Honda, Nissan, and Toyota.

At face value, these regulations would mean that these six automakers would have to sell around 30,000 ZEVs in 2015 in California alone.  This, however, is not the case.  The ZEV program is governed by a system of credits that may be traded between any automaker or third party.  Therefore, if a large automaker is unable to meet its ZEV mandated requirement in a given year, it may buy ZEV credits from an automaker that has a surplus of credits.

A Sales Challenge

Further complicating this program is the fact that not all ZEVs sold receive the same number of credits.  For instance, a RAV4 EV receives 3 credits, a Tesla Model S receives 4 (it used to receive 7), and an FCV with a range of over 300 miles receives 9 credits.  This essentially means that the sale of one FCV by Toyota in 2015 would be worth the sale of 3 RAV4 EVs.  Therefore, Toyota does not actually have to produce and sell enough ZEVs to reach 3% of its total number of vehicles sold in 2015, as the ZEV program states – which would be good news for Toyota.  It does, however, mean that the company needs to start selling around 1,000 FCVs annually in just California for the next 5 years or it will likely have to start buying ZEV credits.

1,000 FCVs may not sound like much, considering Toyota sold slightly over 1,000 RAV4 EVs last year.  However, FCVs have considerable market challenges that BEVs do not, including:

  • Hydrogen infrastructure is expensive to build and few stations exist today, while electrical infrastructure is cheap and ubiquitous, including in homes.
  • The cost savings of driving on hydrogen rather than gasoline are questionable, while the cost savings for driving on electricity are significant and well documented.
  • Lastly, the first FCVs are anticipated to be far costlier than BEVs.

The advantage an FCV offers is a range over 300 miles and fast refuel times.  Toyota bets this advantage is substantial enough to drive sufficient consumer interest to achieve compliance targets.  If Toyota is wrong, the abandonment of the company’s BEV compliance programs will prove extra costly.

 

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