Changing Cities – Changing Cars
Hear from the world’s leading car manufacturers on the future relationship among and between cities, cars and fuel. How are Toyota, GM, BYD and Mercedes transforming their products, services and business models for a post-carbon world? What trends do they foresee for urban driving, and what vehicles and new mobility solutions are being developed?
- Moderator: Bill Reinert, National Manager of Advanced Technology for Toyota Motor Sales, USA
- Lawrence D. Burns, Ph.D., Professor – University of Michigan /Director – Roundtable on Sustainability Mobility at Earth Institute / Senior Advisor – Hess Corporation / Consultant – Google
- Chris Borroni-Bird, Director of Advanced Technology Vehicle Concepts and EN-V Program, GM
- Sascha Simon, Director, Advanced Product Planning, Mercedes-Benz USA
- Micheal Austin, Vice President, BYD America
Well, that’s a fantastic start for us, a framework to hold all of the content of the next day and a half to provide a context. While the panelists are joining us here for the next session, Bill Reinert will moderate that session. I think John from Ford will also join us. We have a chair for you up here. John is a new addition to the panel and Bill will have the chance to introduce them each. Sit gentlemen.
Those of you who have a seat next to you perhaps move in a little bit so the folks coming in don’t have to annoy you while they’re trying to find a seat in the center. If you see one, grab it. Bill Reinert, some of you know is the National Manager, Advanced Technology Programs for Toyota Motor sales. This is our dream team, I guess, trying to have all the innovators representing the most innovative companies in the automotive industry. I’m going to turn this over to Bill, and go for it.
Thank you Gordon and thanks everybody for being here today. Before we get started, I want to point out three people from Meeting of the Minds that made it possible for me to get here and help me. One is Alison Peters; she’s a dear friend from the Deming Institute. She’s helped us immensely in a number of ways. Other is Christy Odette who got us rooms and made things happen and finally Jessie Filler. Those three people. Raise your hands and thank you.
I had an interesting week last week. I drove from Los Angeles to the airport, flew to San Francisco. That was the Asia Pacific Economic Cooperation Meeting and we had transportation ministers from all over the Asia Pacific realm. The theme was transportation energy. The reoccurring thing of all the presentations – Secretary Chu was there and Secretary [inaudible 02:03]. The integrating theme was, ‘The car as the destructive source, as a bad source.’ I felt a little bit odd about that.
I immediately flew from there to Japan where I travel great distance on the Shinkansen. I actually stayed in Tokyo and worked in Nagoya. Now I’m here. What I want to say is, yes, the car – there are a billion of them on the road ñ 250 million of those are in the United States – and I can see with the number of traffic fatalities we have and the congestion, why you can think that. But I also want to point out this: a bus, even a bus rapid transit, with one passenger is one of the most ineffective ways in the world we can move people around and the same way with the train. Cars [inaudible 02:52]. They can be an effective distributive way of mass transit.
The folks that I have here today, we’re all on the same gig. We’re all from the advance technology. The way this would work is they will come up and talk a little bit about what they do and then we’re going to ask some questions, and we’ll open it up to the audience. We don’t know what’s on your minds, and we want to find out what you’re thinking about.
First is my friend Chris Borroni-Bird. Chris is General Motor’s Director of Advanced Technology Concepts and he’s working on the EN-V Program which is a heavy Telematics Electric Program. Sitting next to him is a man that I’ve admired all my life; he’s Larry Burns. He’s past Vice President of General Motor’s Research and Development. Together Chris, Larry and Mr. Mitchell – who is now dead – wrote a book, ‘Reinventing the Automobile Personal Urban Mobility for the 21st century.’ It’s a great deal.
Next is Sascha Simon and Sascha is also working on the telematics electric cars and advance power transit – the theme here – Mobility. I want to put a plug out. Sascha’s also strongly involved in his own nonprofit board to strive to prevent shark finning. So please talk him about that. Next is Micheal Austen, my buddy from BYD. If you don’t know what BYD is – incredibly vertically integrated Chinese conglomerate. It’s incredible the stuff they do. I hope we’d get into some of the things going on.
Finally is my new friend, John Coleman who I met last night, saying ‘oh, will you join this panel?’ I surprised Gordon this morning. So John does Fleet Sustainability. He works with the customers to turn their fleets into sustainable fleets.
I’m not going to give any more. I want these guys to come up and introduce themselves. I’ve got some great questions. We’ll see what’s on your minds. Go ahead and I’m going to stand back because it’s a little too friendly.
Thank you, Bill. I would like to thank Gordon and Bill for the invitation to speak to you today. It’s a great honor for me to be here. At the 2010 Shanghai World Expo, the theme of the expo was, ‘Better City, Better Life.’ General Motor’s and our joined bench partner in China, SAIC, we had a pavilion at the Expo. We took that theme, ‘Better City, Better life,’ and we applied it to our business which is Mobility.
We wanted to come up with a vision of the future that would enhance the way the cities work and would enhance people’s lives at a personal level. We’re thinking about, ‘What type of solution would be that vision?’ We’ve thought about, ‘What are the problems that cities are trying to solve from a transportation perspective?’ Obviously, they want clean air. They want to be able to use less energy and diverse sources of energy. They want fewer accidents on the roads, either between the vehicles or between vehicles and pedestrians and cyclists. They want to reduce congestion. They want to reduce the space required for parking cars.
These are some of the challenges that cities face from a personal transportation perspective. On the other hand, when you look at it from the individual perspective, there’s a reason behind this congestion. It’s because people are driving cars. And why they’re driving cars even in these densely congested cities when there are alternatives in many case ñ well, it’s because you can choose where you go. The freedom to choose your route and your schedule is important for a lot of people; the ability to carry stuff; the ability to be protected from different climate conditions whether it’s rain, or snow, or wind, or hot temperature in the summer or humidity; the freedom to have some privacy in your vehicle; the comfort and the convenience associated with the vehicle.
There’s a reason why people still drive cars even in densely populated cities. Also it’s about freedom of expression. Cars aren’t just about freedom of movement. There’s also a freedom of expression. It’s a status symbol for some people. It’s a personal identity.
The solution we came up with, which we think addresses these different challenges or needs for both the city perspective and the individual perspective, is what we call EN-V. It stands for Electric Network Vehicle. I’ll be showing you a video very shortly. It shows a vision of what mobility might be like in a city in – let’s say – 2030, although the building blocks are here right today if we want to move on this quickly.
It’s a small vehicle because parking is a challenge. It’s a highly maneuverable vehicle because many of these densely populated cities have narrow streets. It’s a battery electric vehicle because you don’t need to go very far or very fast in cities. That’s a good opportunity to use batteries. And very importantly, it’s a networked vehicle – because you can’t solve congestion; you can’t find parking spaces more easily; you can’t avoid accidents just by making vehicles smaller or cleaner ñ so the vehicles can communicate with each other.
We think the solution that we have addresses many of the needs facing cities in the future. It retains the essential benefits of a car in an urban environment without the downside associated with the car. Very importantly, it can also drive autonomously.
One of the other trends facing society in the future, in addition to urbanization, is aging. As people age, they don’t want to give up the keys to their car. They want to retain that sense of independence. This vehicle is capable of driving manually and autonomously. I think it opens up some very interesting possibilities for integration with public transport.
Today’s cars are large mechanical stand-alone devices. These are small networked clean electric devices. With that I would like to cue the video again. Don’t just think of this as a solution for a megacity like Shanghai. This could be used in many places where the population density is quite high. It could be in communities here in America; college Campuses for example or small cities that want to have a different quality of life. So although this is in the context of Mega City like Shanghai, its application is far broader than just densely populated cities.
So let’s cue the video.
See? I’ve told you that this is going to be here. Next is my real good friend Larry Burns. He’s an automotive icon. It’s an honor to have him here.
While alternative propulsion and alternative energy seem to get all the attention, I believe driverless vehicles and the precise coordination of everything that moves around ourselves and our goods will probably prove to be the most transformational sustainable mobility technology all of us could experience.
What I really want to do today is share with you why I reach that conclusion. I’d like to focus on questions really hard before I focus on answers. It’s sort of the situation Prince Charles and Camilla found themselves in recently after the wedding. They were having a quiet glass of wine and suddenly she said, ‘Oh, I love you, I love you.’ He said, ‘Is that you speaking or the wine speaking?’ She says, ‘No, it’s me talking to the wine.’ So I think you need to figure out the questions first.
I first begin thinking about cars that don’t crash in the early 2000 time frame: 1.2 million people a year die on the world’s roadways and I, as the head of the R&D at General Motors, really felt morally obligated to do something about that. I asked my R&D team, ‘If cars didn’t crash, how would you design the car? What might you do differently?’ This is one of those big transformational questions that got us thinking in a very different direction.
My boss from many years was Rick Wagoner. He once asked me a question like that. He asked me if we could reinvent the automobile, given that what we know about technology and what we know about the issues we’ve faced. What we would do differently. That really drove our agenda for many years.
I asked my wife a question like that the other night. I said, ‘If something happened to me, do you think you’re going to get remarried?’ She says, ‘I couldn’t do that.’ I said, ‘Well, I’d be gone and you’re still young. You ought to think about that.’ She said she would. I said, ‘Well, if you remarry, are you going to give this guy my car?’ I have a Cadillac XLR. She said, ‘I couldn’t do that.’ I said, ‘Well, I’d be gone, it’s in the garage. It just makes sense that he could have this car.’ She said, ‘Okay, I’ll think about that.’ I said, ‘What about my golf gloves?’ She goes, ‘No, he’s left handed.’
It really made me think about this, but we concluded as we thought about cars that don’t crash that the car would need to drive itself if it was not going to crash. The driverless car then has enormous safety benefits obviously. But it was also really getting that an important consumer concern. Driving distraction is a pretty important concern. We became convinced that the driving is the destruction.
Why would anyone drive a vehicle going 70 miles an hour, and the vehicle weighs 3,000 pounds and they’d be sending their text message? The consumers were saying to us, ‘Maybe there is something more important than using our time driving.’ It became clear that driverless cars could be a game changer, not just from a safety standpoint but from a consumer experience standpoint. If we could free up $50 an hour a person, an hour a day for 250 days a year ñ that’s $12,500 a year of value. That’s half the price of the car in one year.
I had never seen a technology on my automotive career that came close to having that transformational impact on a consumer value. We were getting more excited about that. We felt if the car didn’t crash, we could significantly reduce its mass. It makes the car more efficient and importantly enables the batteries for the car to be more practical. EN-V has a 3 to 4 kilowatt hour battery versus a Chevy Volt that is 16 kilowatt hours and then Nissan LEAF that’s 24 kilowatt hours.
When we were working on this, along came the DARPA Urban Challenge. The challenge there was to create a car that could drive itself 60 miles in the city setting and do that in less than 6 hours. It’s a $2 million first prize. That’s pretty important at GM. At the time, we hit the wall financially. We needed the money so we decided to enter this competition. Seriously, we teamed up with Carnegie Mellon University and created a vehicle for that competition.
Of 85 teams that were in that completion – if you’re wondering how real is this driverless car idea; 85 teams – 35 of them made cars that passed the driverless driver’s training test. That’s pretty profound as well. 11 made it to the finals and we were fortunate enough to win. We designed a vehicle that stopped very aggressively, accelerated very aggressively. We thought we could pick up six minutes in the competition. We actually beat Stanford and Volkswagen by about 20 minutes.
Our vehicle was like an X Game competitor and it looked like a figure skater; this remarkably graceful and precise car. The real story was the technology. We became convinced from that experience that cars would someday drive themselves. I couldn’t tell you when but we are working on it pretty hard.
It turns out Google had some more aggressive ideas. They ended up hiring 12 of the great young engineers in that competition. Not just from the winning teams, but from all of the teams. 18 months later broke news that they have accumulated a 150,000 miles on public roads with driverless cars. You go, ‘How did they do that?’ This is where the courage of the innovative companies come in.
They found out that in California, as long as you were sitting in the driver’s seat, it didn’t say you had to touch the steering wheel, the break or the accelerator, but you could drive the car on public roads. It’s critically important because engineering is all about learning and you have to learn with real consumers and real settings.
Now that we were convinced driverless cars were real, along came this notion of what we call the ‘mobility internet,’ this ability to precisely coordinate the movement of everything that we have moving around that helps us lead our lives economically and socially. The mobility internet would do for cars what the information internet does for computers. This precise movement in milliseconds and millimeters, all the way up to mega meters, miles and months of really opportunity to take advantage of the massive amounts of data that we have available to manage the flow of everything.
When we put the driverless vehicle and the mobility internet together, then we bring in the information internet and the energy internet which some people refer to as a Smart Grid, we really think we’re on a path to transform the daily lives of people. The driverless vehicles that don’t crash can be precisely coordinated with this mobility internet and then it allows us to have purposeful designs like the EN-V that Chris showed us.
Let me share a few metrics on that car, the EN-V. 15x – what I would give you now there ñ well, 1% of energy in a gallon of gasoline goes to move you. It’s amazing. We don’t have an energy challenge; we have a system design challenge. When you combust the gallon of gasoline 75% is lost as heat. The car weighs 3,000 pounds and you weigh 150 pounds. With the EN-V, we believe we can get these cars down to 500 to 700 pound range. That’s a 5X opportunity and that enables electric drive which is a 3x opportunity versus combustion. That’s 15x.
The second metric is 10x. It has 1/10th as many parts in it as a convention automobile. Therefore, it’s going to be relatively inexpensive because of fewer parts and far less mass. That leads me to a 5x, 1/5th of the total cost per mile to move around and interact with this. It’s insurance cost, the cost of the vehicle, the cost of the energy that tolls.
The other 5x Chris mentioned already. We can park 5 of these in the space of what it takes to park an automobile. Oftentimes, as parking is [21:33] city, not the actual driving. The most important X is ‘0x’ in terms of fatalities and injuries.
We think we’re on to something and kind of excited about it. Better yet, these EN-Vs can be viewed as shared mode of transportation. Maybe we don’t need to have them personally owned. When you share a fleet in the city, we think we can probably function with 1/3rd to 1/5th as many of these vehicles as privately owned cars today. So you put all of that together, the opportunity to interface this vehicle with public transportation. We are hoping we can get some transformational change from that, and total what we do – we call this the Power of ‘And’. That integrated system’s thinking, and what we’re doing now these to micro what I am doing with Columbia is to try and find a way to test this out in a real setting to actually build this. Get the team of companies together that can make it possible. Thank you very much.
If you think that autonomous driving is a far distant dream, today while we’re here, the state legislature in the state of Nevada is now crafting legislature to allow autonomously driven vehicles on the roads. That’s going on right now as we’re here.
Next is Sascha Simon from Mercedes Benz. I urge you go outside and take a look at some of his beautiful products that he has out there. I think you’ll hear a message from him that resonates with everybody. Thank you.
Thank you, Bill. It’s a pleasure to be here amongst such distinguished speakers here. I’m particularly happy to present to you a couple of our very innovative products. I have the pleasure of leading the Advanced Product Planning in the United States, meaning everything that’s 5 to 10 years out. That allows me to play with all these fantastic toys that come up out of the research lab.
Last December, we launched our first small serious hydrogen electric vehicle in Los Angeles and that was for me a very important milestone. I’m a pretty strong believer that we eventually will bring cars to zero oil emission. There are many ways out there. I think probably all of us agree that electric transportation is going to be the future. How are we going to get the electrons in the cars? There are different opinions on that.
We at Mercedes Benz believe strongly in hydrogen electric technology. We brought you the V Class fuel cell here to take a look at that. This car is a fantastic little gem that brings to it 40 miles range with a 3 minute filling time. It’s all electric, has zero emission. You can lease it right now. We feel that the future is right now. We’re also here to talk about urban mobility and the previous speakers have mentioned, ‘How are we going to help congestion in cities? How are we going to provide new opportunities in mobility in our cities?’
About two years ago, we started a new idea around that, that we called Car2Go. Car to go is an innovative ‘Car-Sharing Concept’ that we’ve launched first in Germany and then we rolled it out to the United States. Now, it’s also in Canada. It’s very interesting. I think currently very successful way of bringing cars or individual mobility to a higher degree of usage.
Think about if you buy a car; it probably sits in your lot 80% of the time. If you would not own that car but would rather share with others, the utilization of this asset would be much higher. This was one of the ideas we had.
The other idea was, ‘Let’s focus on cities and let’s have a small footprint vehicle in the cities.’ What I would like to do, I would like to show you a little movie clip and then after that, just give you a little bit more details about where this future is heading and the exciting news that we’re planning with this. If possible could we roll the video clip?
My life is complicated. Sometimes it’s hard to know if I’m doing the right thing, if I’m making the right decisions. I recently became a member of a new car sharing program called Car2Go. It’s convenient and completely flexible, making it easy for me to get around.
I’m amazed by how seamlessly it’s become part of my day to day life. I just hold my membership card up to the card reader on the windshield. I simply pay for the time I use the car. I enter my pin number and select the account. Is the car clean? Yes. Is there any damage? No. Accept ‘Terms and Conditions,’ grab the key and I’m on the road.
I had no idea what to except when I first drove the Car2Go. It’s actually a blast to drive. I had no problem cruising the highway and you can choose between manual or automatic transmission. The optional cuddle shifters are awesome. In the city, I prefer automatic. It’s just easier. I love this car.
Car2Go is great because you don’t have to deal with the things that make driving your own car such a pain. All your fuel is paid for. Insurance is included. They clean it for you and there are no worries about the additional cost of maintenance like AC, changing the oil, warranty issues. Plus it gives great fuel mileage which you can’t help but feel good about.
It’s also comforting to know that Car2go meets or exceeds stringent Federal Safety Standards. When I’m done, I just leave the car in any on-street parking spot or one of the designated Car2Go spots around town. It might be the easiest part of my day.
Getting started is really easy. You can attend one of the Car2Go registration events or just register online. You can pick up the car at a moment’s notice or, if you want, reserve in advance by phone or on the Car2Go website.
Car2Go, it’s my personal public transportation. Sign up at a registrations session or online.
I think that goes very well with Gordon’s theme of the future ‘right now.’ That’s something that we have in Austin. We have in Austin 15,000 customers already. We started in Vancouver. We are just finishing the first 100 days in Vancouver. It’s very successful there. The exciting news is that that little smart car that is also outside waiting for you to take a look at is going to come to San Diego as a Car2Go car as an all-electric car. We’re going to roll out 300 battery-driven smart cars into a Car2Go program in San Diego.
We’re continuously rolling it out to other cities around the globe, not only in the United States ñ Asia’s next on the road. We feel strongly this is a contribution to the future of urban mobility. Right now, I am very interested to have a good discussion with the panelists and looking forward to your questions thank you.
Make sure you ask him about his shark finning program. It’s really unique. Next is Micheal Austen. He’s from BYD, Vice President of BYD. You may not know who BYD is. They’re an awesome company. He’s a great guy. Thanks.
I’m the Vice President of the Marketing PR for BYD. I’ve been with BYD for 6 years. I’ve known BYD for about 12 years. I was with Motorola for 15 in the procurement role; I bought about 70% of the razors for Motorola from BYD. They manufacture a lot of cellphones.
In 2002, they started manufacturing automobiles in the China domestic market. I’m going to really focus my discussion on China and how BYD has looked at, how that market is evolving very quickly – because I think it has ramifications for our discussions here. If not, we’ll force some of our decisions one way or the other.
An update on China. Our growth – we would be very pleased if we hit 13 or 14 million vehicle sales in the United States this year. China did 18 million last year and they’re controlling some of the growth. They’re trying to. It went from 27% last year to 37%. This year maybe 10% to 15% but that means by 2015 – which is kind of a milestone that we’ve heard from the Obama Administration ñ there would be about 25 million cars sold in China.
Their goal is to have 10% new energy vehicles. They want to roll that out to 50% – their goal by 2020. That means by 2020, if there are 47 million cars sold in China, 23 million of those would be new energy vehicles, if the government meets their goals. I’ll talk about some of the policies and trends that they’re driving and some of the technologies.
BYD introduced a parallel series hybrid electric vehicle mass production in December of 2008, the F3DM. That’s been in fleet testing in LA as well. We introduced an all-electric E6 for fleet testing in spring of 2010. That E6 in the center is a 5 passenger cross-over vehicle. It’s driven accumulative 2.7 million miles in taxi fleet operation. They beat those taxis up for now 18 months. It’s been a very good test.
What we’ve been able to prove to the market is that we can rapid charge those cars in 20 minutes without a significant degradation of range or energy. That is with the Iron Phosphate Chemistry.
We’ve also launched busses; electric busses. We have about 300 electric busses running on city streets and the cumulative miles an hour were about 60,000 miles. We have one bus going around the U.S. right now. It’s been in 13 cities. But that bus is an all-electric bus that goes 300 kilometers on a single charge and can carry 65 passengers standing room, if you’re in China.
In the U.S., you need a little more personal space – about 40 passengers by U.S. Standards. But still that goes 187 miles on about $8 of energy cost versus 25 gallons of diesel or the equivalent on CNG. So it’s a very interesting mass transit solution because of the operating expense. These are some of the products that are rolling out in China.
This is the summary on the taxi fleet. You’ll see these red taxis across Shenzhen. There’s also a blue version. Now, they’re up to about 300 of those taxis running on city streets. Hert has begun renting those vehicles in Shenzhen. They have some on order for Shanghai and for Beijing that will be launching very quickly. It’s very interesting.
Those rentals are for chauffeur rentals. Chauffeurs would go on and rent the car and then do chauffeuring services in China. It’s still very much a public transportation. The interesting thing about both the cars and the buses, and when you’re talking about the future, I believe that the issue would become a design for adaptability. I totally agree that one solution may not fit every community. But if you’re on an electric platform, it’s adaptable. It’s energy source signostic.
It can use fuel-cell, electricity. It can use CNG electricity. It can use coal burning electricity or nuclear electricity. It doesn’t matter where you get your source. If a community is more progressive on renewable, that’s great. Whatever they implement is immediately transferred to the solution that’s in your electric platforms.
When you’re buying a bus, that bus solution is a bus solution that you’re going to have for 15 to 18 years. Those buses are meant to last 15 to 18 years. If you’re locking into one energy solution, whether it’s a diesel solution, a CNG or a CNG hybrid ñ you’re betting on that fuel source for the next 18 years. But if you’re electric, you’re actually not betting on a single source. Whatever you’re community adapts over that period of time, you’re immediately adapting on your public transportation. You can clean up the environment as your community has an appetite and resources for it.
So these are some of the buses in the bus fleet. This is the total life cost that we’ve shown. This is including Capex and Opex. So, you can get a pretty good Diesel bus for about $350,000. The CNG bus around $400,000-$450,000. If you do something with clean Diesel or clean CNG or CNG Hybrid that gets to be about $700,000 in your upfront bus cost.
An electric bus from BYD has landed in the US for $650,000. If you couple that with the fuel cost or the fuel savings, the maintenance cost or the anticipated maintenance cost of an electric vehicle versus rebuilding that diesel bus over those 15 years, you see that you save about half a million dollars over those other solutions in total life cost over 12 years. We believe this is going to not only be a mode to recover our environment but it’s an economic recovery.
When you’re driving 65 passengers on, $8 of energy, for 187 miles, you can expand your mass transit routes. You can increase the number of bus drivers you’re buying locally. We believe that this is a path to economic recovery for a lot of communities. The charging in China’s very different than what Europe and what the United States is adapting. The trend is for fast charge ñ that’s driven from a number of needs.
There are a lot of densely populated cities with shared parking. They have to have a rapid charge facility where people can come in and rapid charge. For the last 18 months, those taxis have been pulling into public charging stations owned by the utility. The utility actually charges about 4 times the going rate for electricity. So they have a revenue source and those taxis fuel up during the day, during their driving time.
It takes about 20 to 40 minutes depending on the state of charge when they pull into the fuel station. At night, those public stations, those utility public stations are where the electric busses park. They park and charge at night. The same facilities are multi-used across Shenzhen. Their plan is to have 250 of those installed by the end of this year. They have funding to do 22,000 charging stations by the end of 2012.
You see – if you look at their 5 pillars of their national growth, one of the pillars is electrified public transportation. They have $15 billion that they are putting for in just Beijing alone for infrastructure improvements. Here are some more of the Chinese multi-charging facilities.
The charging technology’s different than CHAdeMO. CHAdeMO, at least the older standard, was a 62 kilowatt maximum. The China standard’s up to 180 kilowatts which means you can literally charge three times faster now. The pins on those adaptors are much bigger. They are for max Current. They are about 300 Amps for pin. They are bi-directional. They have very different standard in China. It’s out of a need driven for a ‘rapid charging.’
We believe the trend will be, as cities attract more people and have more shared parking – it will need multiple fast charging facilities across the city. For the United States, it’s different. 80% of our residents have garage and so for the next couple of years we’ll be charging at our garages empowering our commute. We’re not really thinking about long range cross-country trips yet with electric vehicles, though that E6 goes 300 kilometers as well on a single electric charge.
So what’s the China state doing? Well, there’s significant amount of investment they are putting in. Now today, they import about 50% of their oil. They see this as a national issue for security specifically. They obviously have some need to reduce the pollution in their density populated cities because they bear the weight of those health care cost.
There are a lot of reasons why the state wants to begin targeting these new energy vehicles. They want to reduce the consumption of oil for obviously security issues. They want to increase the number of vehicles on the road – specifically new energy and battery electric vehicles. They’re throwing a lot of incentives. I’ll show you some examples of incentives. They want to put in this State Grid and the Southern China Grid Charging Stations to support longer range transit. These were the initial five cities.
Growth hasn’t been as fantastic as we wanted because they limited to a number of cities they were launching. They have expanded that now to about 20 cities. To give you an idea, in those 20 cities, what those savings are ñ we’re talking $18,000 for a subsidy on an electric vehicle.
That E6 that has a 60 kilowatt hour battery – the cells are about $34,000-35,000 with $18,000 off ñ becomes very attractive. It goes almost 200 miles with a single electric charge. It’s driving some very interesting demand and we see initially fleets picking this up in significant amounts. We’ve been sold out for domestic bus production and domestic taxi production, just for the fleet sales. We’ve been focused on fleet sales. I believe that we will continue to be focused on fleet sales because of the orders on hand. We see the city – just the city of Shenzhen has 13,000 buses. Their plan is over the next 6 to 8 years to replace those 13,000 buses with electric.
Now, just to reset your understanding, in the United States, our bus rapid transit fleet, when you add them all together, is about 66,000 buses. Now, if you add on shuttles and chartered busses, it’s different. But when you’re just focused at the bus rapid transit, 66,000 buses ñ China has 1.5 Million. It’s very different. They are forcing national standards.
The way they work with standards ñ as soon as the standard’s implemented it takes precedent on all the standards, immediate adaption of new standards. So there are some advantages to a single point of decision making. That’s driven some of these new standards very quickly and they’re recognized for their strides in the EV standards.
I believe there are some things we could probably learn and adapt from the economies of scale that would be driven from China and some of the learning. They’ve got 1.6 Billion people. They’ve got a very large test market that we can learn from. This is not another 8-hour Beijing traffic jam. You can’t see the title. This is zero tailpipe emissions. All these vehicles are electric.
It’s not just one company, it’s hordes of companies in China that are going and I was pleased to hear that GM is launching an electric vehicle production with the SAIC Group. That gives credibility increase to that market. I do believe, because of the adaptability of the electric platforms, they are the vehicles of choice in the future.
One point I would say though, ‘There are times when we want our freedom.’ Americans love the freedom of the road. But there are times when you don’t take a different route to work. I don’t know how many of you go to work every day, but you don’t drive a different route. There are times when you could use your time better. If we could upgrade the demographics of the ridership on our busses with mobile offices, we’d be riding more of these massive transit solutions because we have better things to do with our time in our commute.
I believe there is a place for both. BYD is focused on both the rapid transit and the bus as well as the electric vehicles for personal driving. Thank you.
Finally, we have our latest edition Dr. John Coleman. He’d tell you a little bit about working from the customer side for sustainability.
Good Morning. It’s truly a pleasure to be speaking here. I’m quite excited when I got the invitation about 8:00 last night if I’d be able to speak at 8:00 this morning. So I’ve got extensive prepared notes that I will be taking you through.
For the last eight years or so, I’ve worked in Strategy at Ford, talking about a lot of the same things that you heard about this morning, which I consider the magnificent part of the transformation of mobility. What I’ll talk about briefly this morning is the transformation from this magnificent to the mundane.
All these things truly are magnificent. I mean they are all engineering marvels from all of these companies. When it comes to actually implementing these ideas, it’s really not quite as sexy as it sounds. One of the things that we realized at Ford not too long ago, when we’ve started to do some of these analyses looking 10, 15, 20 years out, we realized that all these advanced technologies, although fascinating, are not going to make the type of difference that we need to see to keep carbon below 450 parts per million.
When we looked at Ford’s fleet of vehicles, we looked at the decisions customers were making. We realized that we have the power as do all of our competitors to develop a fleet of vehicles that the entire fleet will contribute less carbon so that no matter what choice the customer makes, the vehicles will not be a contributing factor or will be such a small component of carbon emissions that it will keep the global climate situation below 450 parts per million.
When we looked at trying to do that, we looked at the volume for electric vehicles in the near term. I realized that if we put 50,000, 100,000, even 200,000 on the road compare to the 500 million vehicles we sell every year, it doesn’t really make that big of a difference to what’s happening right now with the environment.
We’ve looked at things like making a car lighter which we’ve known about for roughly a hundred years, maybe longer. From physics, the lighter something is, the easier it is to move, the less energy it takes. We didn’t realize what the impact of trying to light-weight our vehicles would be. Moving forward, we’re cutting anywhere from 250-750 pounds out of a vehicle with some of the new trucks that we have coming out over the next couple of years. They will be 20-30% lighter than the vehicle they would replace or the replacement vehicle would be lighter than what’s being replaced. We’ve looked at things like that.
We’ve also looked at some of the things that, in hindsight, we wonder how we’ve missed that before. Things like anti-idling technology. The amount of issues with air quality in cities because of idling engines that don’t need to be idlingÖ To give you an example, if you know Xcel Energy here that’s the local electric company – they operate bucket trucks to fix telephone lines and power lines, things like that. Those vehicles up until recently were diesel engines where the engine would idle all day long even though the vehicle wasn’t moving because it needed to provide the power to the bucket and the power for them to do their work.
By developing a diesel electric hybrid where the electric part doesn’t drive the vehicle at all; it simply powers what they need during the day, we were able to reduce fuel usage by about 80% for companies using bucket trucks. Think about reducing your fuel build by 80% simply by adding a smallish battery onto the vehicle, not to power the propulsion, just to make it more efficient. It also allowed them to operate 24 hours a day where before they had to stop at 8:00 night because of noise ordinances. They can’t have a diesel engine idling all night.
Now, they can operate that same asset, twice as much at 80% less fuel. We started talking about real money at that point. I said, ‘It’s not as sexy as the electric vehicles, autonomously controlled vehicles and things like that.’ But, an 80% reduction in fuel usage for a fleet of a thousand trucks or 10,000 trucks? Then you start thinking, ‘Wow. We’re making a difference with what’s currently available and integrating all of these different magnificent technologies however they are available to improve that.’
The other aspect that we looked at that has similar improvements is ‘driver behavior.’ The number of people that are not aware of what they’re doing while they’re driving – and you can take that however you like. The amount of energy that they’re using without realizing it is generally between 20% and 30% that we can improve just with very little coaching. A 20% to 30% improve in our fuel economy.
We’re doing that through telematics systems. We’re doing it through in-vehicle coaching. There are all kinds of technologies available now to enable drivers to become better drivers without the sense of ‘big brother.’ It becomes arguably a video game that doesn’t distract you from what you’re doing. We’ve seen tremendous success with fleets that have incorporated high end telematics and improving driver behavior to the point where it’s made more of the difference than anything else they tried over the last 10 years to be more green.
Simply driving more efficiently made a bigger difference. I said, ‘My job now is shifted to working with fleets. You’ve heard most of these people talking about the adaption of these new technologies ñ very interesting paradigm shift that we need in the automotive industry.’ Fleet managers are ‘risk averse’ by nature. When you think about who manages fleets, you don’t want someone who’s a gambler in managing the vehicles that are in your operation. They need to be the early adapters of this new technology because in most cases for residential or personal ownership ñ we don’t see a huge increase necessarily in personal ownership of vehicles. We see much more of the car sharing, much more of the fleet driven approaches whether it’s busses or the EN-V System, things like that. With shared ownership, the fleet managers have to become the early adapters.
How do we take people who are risk averse by their profession and get them to look at these magnificent solutions and adapt them? That’s the challenge I give to you for the rest of this is to help us to figure out how to do that. Thank you.
Okay, now the fun. I’ve been working on some questions for you guys. I’m only going to ask a few because I’d like to hear what’s on the audience’s mind. But let me start here, ‘Does mobility define urbanization today or is it the other way around?’ In the U.S., mobility means our travel patterns are shifting; we are becoming more suburban, less urban.
I know everybody would like to have work in cities but the demographics are going the other way. Could ‘increase in mobility’ in the developing world have the same impact? Will we see in the developing world, they shift away from the cities into the suburban.
I think it’s hard to separate the two. I really see it as an integrated system. We need the design accordingly. Certainly, mobility impacts the density patterns and density patterns impact where the activities are. It all feeds onto each other. I think the real key going forward is to think about the whole and work on that challenge from the integrated systems perspective.
Cool. What do you think Sascha?
Well, I also agree with you. It’s really systems of systems approach here. But I also think that we need to take a look at the holistic approach, ‘What do we want the third world to become?’ Do we want them to be a little bit more urbanized culture? Is it going to work out? Do we have enough resources on the planet actually to copy and paste U.S. Style of transportation and urbanization into other countries?
I think that the answer would be, ‘probably not such a good idea.’ I think if you just look at the developing countries, we have to come up with better approaches. We have to take the lessons learned from the industrialized world and to help them to not follow the same path. The suburbanization creates all these energy intensive forms of mobility that we have today.
Okay, so almost inclusively with the exception of BYD and a few others ñ the role of pure electric cars mostly in urban mobility, urban transport – let’s get our crystal ball, that’s what we’re all paid for – in 2030, is this true? Are you going to see full longer range EV’s or will that shift to fuel-cells overtime?
Well, I think there’s two ways of thinking about it. One is that the vehicle technology may improve significantly through battery improvements or perhaps without using an extended range electric vehicle or fuel-cell electric vehicle, still electric drive. The other way it could go beyond the urban transport is through infrastructure improvements through, for example, inductive charging.
This experiment’s going on around the world, around putting inductive charging in the parking spaces, maybe in bus stops where buses are loading and unloading people, maybe even in the road itself. If that comes to past, that could really begin to change the economics of battery-powered vehicles and the viability of them.
John, what does Ford think about the 2030?
Our best guess is that we have no idea. I don’t believe that electric vehicles ñ they don’t provide the capability and the capacity for heavy duty use in all applications. There are certain applications where the energy density in liquid fuels cannot be matched by any known battery technology today that is commercialized or that is mobile.
We tend to see more to the alternative fuels, the Bio-fuels, that if the Bio-fuel companies can develop a fully, basically a B100 Bio-Diesel that has the same energy density as petroleum based diesel, then that combined with an electric hybrid power train is likely to be the dominant power train outside urban areas.
With urban areas, electric vehicles are in. It’s a given. That’s going to happen. But if you work on fixing barb wire fences out in Wyoming, I’m willing to bet an electric vehicle probably is not going to get it done for you even in 2030.
Yes, I agree.
It’s important to keep in mind that consumers have a wide range of driving cycles from city to highway ñ and duty cycles from light loads to heavy loads, so when you are on the auto industry, you need to comprehend all of those consumer requirements. I encourage us all to keep that this word ‘and’ in mind because we’re going to need electric vehicles that plug-in with batteries.
We’re going to need fuel-cells. The beauty of a fuel-cell electric vehicle is that it can refuel in 5 to 8 minutes, gives you 3 to 400 mile range and serves your family size requirements. That doesn’t mean it’s either-or, oil or battery. I think we’re going to need both of them. The oil is going to stay around for quite some time. The natural gas is going to get interesting. So we need to keep them all in play.
Okay, last question. This is for Micheal. China’s developing these massive new cities as they grow and I know that BYD’s a part of that ñ does telematics provide an integrating function between your products and the urban planners who’re developing these cities?
It will become very important. It hasn’t been integrated yet but I think in order for it to really get mass market adaption, telematics has to be integral. You have to locate available charging stations. I think car sharing will become popular. So I think they will all. One thing that I do predict is that it will be more about the energy, and a couple of comments on it – because how we use our extra energy ñ there will be overhead.
BYD has a 60 kilowatt hour power plant in the electric vehicles of the personal vehicles and in the bus it’s 324 kilowatt hours. So, in the future depending on the way we set policy and do vehicle to grid, vehicle to home or vehicle to vehicle, how will you use that extra energy will become, I think, one of the key enablers for some of the long range products.
I also want to speak on the Wyoming comment. The best transportation is horse. It can eat grass. It has unlimited range and I cannot believe the marketing challenges that the automobile, this new fangled thing got passed to launch. In Wyoming it would have been a great discussion because I’d say, ‘There’s no alcohol distribution anywhere across the state of Wyoming. I’m going to use my horse. I don’t need a road.’
I think the barriers to entry for electric vehicles today are much less than it was for the ‘horse to automobile.’ They overcame that with interstate highways and vehicles that could go from gasoline station to gasoline station. We have electricity in every restaurant. I don’t think the barriers are as large for an electric vehicle.
By the way, if I got a mobile energy source that I’m hauling around with me in Wyoming as I can be doing other things, then it changes the way I look at that application. In 2030 absolutely you will have electric vehicles on the ranges in Wyoming. You’ll have solar charging stations ñ just like the wind mill – he’ll have a solar port and he’ll go in and pull in. He’ll have his own island.
Can I comment on that?
Thank you for saying that. I think this is great and also would like to provide potentially a little bit of a different perspective. I think it’s good if we don’t have all the same opinion here, makes it a little bit more interesting. I agree with you entirely that by 2030, there is no reason that electric vehicles couldn’t be in Wyoming, particularly when it comes to fuel-cell technology that’s based on hydrogen.
The hydrogen has a three times higher energy density than actually carbon fuels. Therefore, it provides unprecedented opportunity to actually become the next energy carrier for transportation. We have buses in Shanghai and Beijing right now that are running as electric buses on hydrogen with a fantastic range. You could easily build large dump trucks running on hydrogen fuel-cell technology.
While I agree that in 2030 we’d still probably have internal combustion engines on the road, I’m not going to have any expectations to what’s going to be dominant. I think it has so much to do with where energy prices are going, where the global demand for carbon fuels will lead us. Oil is such a valuable resource. It’s way too good to just burn it. I mean look at this room, every material that you see right here probably somehow is a sub-product of oil. Why would we just burn it if we have something better?
The opportunity with hydrogen lies in that you can generate it with a gazillion means. Hydrogen is the most abundant element in the universe and you can make it pretty much of everything.
I would sayÖ
Sorry, I just had to jump in there.
We’re running out of time and I know that there are some questions in the audience. Would you state your name and who you’re with?
I’m Nancy Clanton with Clanton Associates Engineering firm here in Boulder. We did a study to look at the distribution system required to charge electric vehicles and what we’ve discovered was that our existing distribution system was completely inadequate to be able to take on these things. I mean when you’re talking about 60 KW ñ well that’s as much energy a typical Boulder home would use in an entire month.
If you’re looking at 300 KW for a quick charge, that’s going to require so much more distribution and new distribution lines for utility company. So how do you handle that? Even putting in five charging stations at a parking ride would need 15,000 KVA new transformers. Those extra costs are huge between about $15,000 for a level two charger or $100,000 for one of the quick chargers. How are those economics?
We’re running out of time. I want to get the other questions all stated and we’ll answer them. But I would like to direct your questions specifically to a young lady here, JC Chipwood, who’s the Electricity Chair of the Future Transportation Fuel [inaudible 01:02:58], course for the DOE and she actually has a tremendous amount of intellect.
Great. So, I’ll talk to her later.
The China does not have the distribution system we have in the United States.
The reason I’m taking all the questions are because we want to get them on the internet and then we can answer them. Okay, your question.
Hey Bill. It’s Scott Belcher from the Intelligent Transportation Society of America. I just want to let the audience know that if you’re interested in this panel and what’s been discussed, the ITE world congress is in next month in October in Orlando.
The EN-V vehicle – will be having the EN-V vehicles there. Bill Ford will be speaking, will be a keynote. Allan Guerlain from Alcatel Lucent. There will be the vice minister of China for transport will be there.
So if you want to see this technology in action and really feel it and touch it and see it happen, please see me and I can give you information or go to www.itsworldcongress.org thanks Bill.
Hi, I’m Sean Randolph of the Bay Area Council Economic Institute. Bill, I was at the same event with you last week, the APEC Energy and Transport Ministers Meeting. As a part of that, we had a reception at the FedEx transportation hub in Oakland where there are about 15, 20 alternative fuel vehicles lined up and it was really interesting to go and talk to the engineers about the different approaches of each one.
I was really struck by one of them which I think was a Toyota vehicle which was a hybrid fuel-cell and battery vehicle. I said, ‘Well, what’s your range?’ Well, it’s about 400 miles. ‘How long does it take to recharge?’ About five minutes. I don’t know. What’s wrong with that? Of course of the infrastructure, you have to have the Hydrogen fuelling infrastructure. Arnold Schwarzenegger hydrogen highway hasn’t gotten very far so far.
I’m wondering if anybody can comment on this question of – you’re developing the vehicle technology, but what is the strategy for working with government, cities, and state, federal around policies, standards and incentives so you’ll have more of a simultaneous process or sequenced process for getting the necessary infrastructure to make the vehicles viable?
With that electric infrastructure question and a hydrogen infrastructure question ñ they’ve almost the same answer. We’ll get to you okay.
I’m Andrew Birmingham, CEO of Montreux Energy. I have a question for Micheal Austen. I actually have a suggestion for one of your slides. You did a comparison between diesel, CNG and the battery-electric vision. You left something out which I’m hoping you’ll change. That is you have a little sliver of green showing the environmental cost for both of your competitors but you showed no environmental cost for yours. And that is analogous to my mind to saying you got a Halo.
That’s actually the California tax in the States. It was only the piece that was a carbon taxed that California implements on diesel, CNG and there won’t be a tax. But that’s the only cost we could capture at that point.
Well, fair enough. But I think it’s also important to have at least a place marker to show that none of these visions is clean. In fact, I did my Masters at Colorado School of Mines in Mineral Economics.
One of the things that I think is important to know is what is the other cost that we’re going to be getting into whether there lithium mile, lithium or the precious metals? Boy, I think there’s a lot of room for discussion on that. Thank you.
Sure, there is.
Okay, next question.
Great, Good morning. I’m Drew Murphy with NRG which is, for those of you who don’t know, an energy company, mostly electric power. We’re very interested in where the electric vehicle and transportation sectors are going. Generally we’re active in some efforts around electric vehicle infrastructure charging in the country. I guess the question that I would throw up is comment to the group. I would like to hear the responses on. Some of the stuff you guys talked about is really fascinating. It’s very exciting.
I think I heard that to some degree each of the folks from the traditional car makers up there also said, ‘Well, you know it’s going to be a mix. We need to see what the consumers want and what each of the users’ have. I understand that but I guess I would also say: one of the things we keep hearing when we look at what’s happening in some of the other fast evolving technologies in the internet space and in computers – if you look at what Apple has done, you look at what Google’s done ñ they actually have come out with a product, services that I don’t think any of us knew we wanted or needed. It didn’t wait for us to tell them and have incremental change on what we’re using already. I would never have bought an iPad if you’d ask me a year and a half ago.
I know it is just an example, but I’d like you to sort of throw that filter. Respond to how much you have an obligation or at least from a business stand point, how much do you think do you need to lead people and make the choices and say, ‘It’s going to be electric vehicles or it’s going to be fuel-celled vehicles’ to get people to come together around a product that will actually work as a vehicle. When there are too many things, we may not actually advance any of them – there would be too many choices.
I’d leave you with the comment that I think Henry Ford made which is where we all started which is ñ If you’d ask customers, do they want automobiles the type he made. They would have said no. He actually took them there in the first place. I’d like to hear your thoughts around that.
Do you want to take the other two questions? Okay, I just got a little bit more time here. Go ahead.
Hi, I’m Kevin Kryzeck. I’m a professor here at the University of Colorado who teaches City Planning, focusing on land using transport issues. Notwithstanding the fact that I spend the past 20 years of my research carrier trying to figure out how to make cities less auto dependent, I very much enjoyed the presentations and the power and the innovation that’s coming forth.
As we’ve discussed these issues and moved this ball down the court, there was a lot of discussion on fuel-cell energy, and ‘mobility’ was a term that was used somewhat loosely and somewhat freely. I want to underscore the fact that the nature of this panel, if nothing, is ‘changing cities, changing cars’ or maybe ‘changing cars, changing cities.’
Mobility really refers to the ability for us to get from point A to point B and has less to do with the ease by which we have access to various amenities. That it has to do with the features of landforms, how easy it is, how close things are to changing nature of cities – what Bill mentioned earlier about mixing different transportation modes together. That is all encapsulated under the term accessibility.
So while we have mobility which is one good goal, I think accessibility and changing the nature of cities – I would like to challenge this high powered group, this innovative group to possibly play a more active role in thinking about how we can adjust landforms and not just mobility challenge.
Okay, so we’re going to have to cut out the questions now and we’ll all be available so you can catch up with this. We have two infrastructure questions. We had an almost impossible to get electric infrastructure out and it’s going to be tough because we’re working with the 60 year old grid. So, and with the Hydrogen Infrastructure Question ñ so who wants to jump in?
I’ll do the electricÖ
The U.S. infrastructure though.
How much do we use at night? Are we 60% utilized? Are we 50% utilized? It’s about energy storage. If we have plants that are running – nuclear plants and unfortunately coal plants run all night. They compete for load with our wind at night; use those resources and charge batteries storage.
But let me tell you ñ in fact China, what they did is they just put a trailer battery behind the charging station and then trickle charge that trailer battery. All the time they don’t need to upgrade the infrastructure. They just utilize the night time wasted energy, charge up these battery banks and then rapid charge during the day. So, it becomes a pooling.
We have plenty of possibilities for distributive storage. That’s the solution to better utilizing our electric infrastructure. We don’t have to upgrade as much as we think we do.
I think it’s important to recognize that when you get the consumer value proposition right the infrastructure comes. That came up with Cable TV, it came with cellphones. I think it will with automobiles. The auto industry: GM, Daimler, Honda, Toyota, Hyundai ñ all have very serious fuel-cell electric vehicle programs.
Those vehicles will be launched 2014 to 2016 and they will likely be spending 20 to 30 times what’s required for an initial infrastructure to kick this thing off. So, the infrastructure has been over grown by [inaudible 01:12:03] on the hydrogen front – it’s not going to cost that much. I think that the cars are going to really pull the infrastructure. Do you have anything Sascha?
I’d like to add to that, that actually our cars you can use right now ñ the fuel-cell cars in LA and the ones that you’re actually able to purchase that’s the 14 time-frame. So, we’re going to lease it out right now, because we want it back. As to the other question that we have to educate the customer about what’s possible, that’s what we’re actually doing here with the fuel-cells. Everyone that I have had driving these cars says, ‘Wow. I don’t think I needed an internal combustion engine anymore.’ So, that’s the first thing that this ‘Wow’ effect.
The second thing is, ‘We are working very closely together with Bill and with the other OEM’s to make sure that we get this ‘chicken and egg’ issue on the control where we basically have a fuel station in place. The fuel station needs about 42-60 cars to fill in order to make a business case working.
It’s now just a coordination effort between the car companies to make sure that we’re launching these cars in that section where we have the fueling station. We also need to work together and that’s what we’re doing in many places around the globe. We would love to start it at New York. I think there’s a good opportunity in New York and take it from there.
I don’t think that’s actually Rocket Science. I think it’s going to happen. We’re pushing very hard on this one. Thank you.
Thank you. Well, we’re overtime. I apologize for that. We’d have a great time. You guys can catch us and beat us up, profoundly disagree with us. But, let’s do it over coffee.