Short-term gain puts brakes on German car companies’ electric dreams

Updated 14 October 2017
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Short-term gain puts brakes on German car companies’ electric dreams

The push toward electric cars has been widespread and well documented since the 2009 Frankfurt Motor Show. Yet, German companies have been either lax or reluctant to adopt the new technology despite the success of visionary pioneers such as Elon Musk with Tesla and Carlos Ghosn with the Nissan Leaf.
In fact, Daimler had investments in Tesla but sold its shares in 2014.
Now, the mad rush is on to cover lost ground. The latest Frankfurt show this year saw dozens of German electric concept cars that will hit the markets over the next five years.
The fact remains that ultimately German companies made too much money from non-electric cars to focus enough on the future.
German car manufacturers are commanding huge profits from premium fossil-fuel brands they produce. The result is that they are reluctant to change a pattern that is very profitable and convenient.
Electric cars are expensive to produce and their profit margins are very slim. The industry has been waiting for costs to come down enough to make a partial shift toward battery power.
China’s move to impose a quota of electric vehicles on car imports and the announcements by some European governments of a 2040 deadline for producing only electric and hybrid cars, however, has caused a scramble by all car companies to make up for lost time.
To prepare for the expected drop in profit margins, German companies have focused on cutting costs — by up to €4 billion in Mercedes-Benz and $2.4 billion in BMW.
In the short term, German companies may enjoy a good run of profitable gasoline-powered vehicles. But in the long run, these companies may have missed a rare opportunity to lead in electric mobility technology. Instead they waited and let others take the lead — and the rewards. The result is that China now dictates the ratio of electric cars it needs and German companies have no choice but to comply.
• Adel Murad is a senior motoring and business journalist, based in London.


Saudi Aramco seeks to overhaul engines and fuel amid electric vehicle hype

Updated 06 March 2019
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Saudi Aramco seeks to overhaul engines and fuel amid electric vehicle hype

  • Diesel has proven a key cause of health-threatening nitrogen oxide pollution
  • Saudi Aramco is working on gasoline compression ignition which mixes fuel and air more effectively prior to combustion

GENEVA: More efficient fuels and more sophisticated combustion engines are needed to bring down carbon dioxide pollution and to secure the long-term future of Saudi Aramco’s business, the company’s chief technology officer said on Wednesday.
“The growth of transport is greater than the growth of alternative drivetrains,” Ahmad Al-Khowaiter, Chief Technology Officer at Saudi Aramco told journalists at the Geneva car show.
The spike in electric car production in Europe will not offset an overall increase in global greenhouse gas emissions as emerging economies industrialize and buy cars with petrol and diesel engines, Al-Khowaiter said.
“Improving combustion engines is key to sustaining our business in the long term,” he said.
While carmakers have rolled out advances in combustion engine technology, the availability of sophisticated fuels has not kept pace, Al-Khowaiter said.
Diesel became an industry standard more than 100 years ago and has remained popular mainly because it did not evaporate quickly, making it safer to handle during storage and refueling.
“Rudolf Diesel did not consider fuels which evaporated easily. That was an accident of history,” Al-Khowaiter said, referring to the German founder of the diesel engine technology.
But diesel has proven a key cause of health-threatening nitrogen oxide pollution, which is blamed for respiratory diseases, forcing the industry to explore ways to cut emissions.
“We can now optimize the fuel and the engine at the same time. And we can bring it to market by adding another fuel pump at the gas station, just like it is done with higher octane fuels,” Al-Khowaiter said.
“We do the patents on the fuel development to enable the engines to be efficient,” the executive said.
Saudi Aramco is working on gasoline compression ignition which mixes fuel and air more effectively prior to combustion, resulting in lower nitrogen oxide and soot emissions and a 30 percent improvement in fuel economy.
The petrochemicals giant is also helping to develop mobile carbon capture technologies which could be built into next generation passenger cars for around $1,400 per vehicle, and help to cut carbon dioxide emissions.