Except for a few holdouts, the auto industry is no longer asking if electric and plug-in hybrid vehicles are going to become a reality. The question is now becoming how big the market will be, and how quickly it will grow.
That question, said executives at the Center for Automotive Research's Management Briefing Seminars in Traverse City, Aug. 2-5, is a little harder to answer.
Some of it depends on the cost of gasoline, said Anne Marie Sastry, director of the energy systems engineering program at the University of Michigan in Ann Arbor, Mich. The price of gasoline is going to drive things.
If it stays around $2.50 a gallon, it's going to go slowly. If it goes back up to $4 a gallon, that's going to be a different story. There will be other external drivers as well.
Even with all the attention being given to plug-in hybrid cars and all-electric cars like the Chevrolet Volt and Nissan Leaf, conventional cars and engines will continue to dominate the industry for years to come.
Detroit-based General Motors Co. may be introducing the Volt later this year, but it is also ramping up production on the Chevrolet Camaro.
That's probably not what anyone would call a green vehicle, said Larry Nitz, engineering director for hybrid electric powertrain engineering for GM global product operations.
GM expects that conventional engines will still be on 80 percent of all vehicles in 2020. Justin Ward, advanced powertrain program manager for advanced technology vehicles at Toyota City, Japan-based Toyota Motor Corp.'s North American operations, said it could take until 2015 when more lithium-ion battery hybrids and electric cars are established in the market before the industry can have a better view of how future growth will develop.
Electric powertrains will become more prevalent, but making predictions is difficult, he said.
In the short run, we always overestimate change, and in the long run we always underestimate change, said Ravi Shanker, CEO of Dow Kokam LLC, a Midland, Mich.-based company now building a plant to supply lithium-ion batteries to the auto industry.
Lithium-ion batteries will be an important part of the electric-car infrastructure going forward, and a wide mix of companies are lining up to be part of that supply chain. That includes Dow Kokam and other battery makers such as LG Chem-Compact Power Inc. and Johnson Controls-Saft Advanced Power Solutions LLC, both building new battery plants in Holland, Mich. Some material suppliers also are growing. Celgard LLC is expanding production of its battery separator film line in Charlotte, N.C., and DuPont Co. just announced it is building a new plant near Richmond, Va., to make its new polimide-based separator.
We may be producing a battery bubble, warned Kregg Wiggins, senior vice president of the powertrain division of Continental AG. The Hanover, Germany-based firm makes parts for traditional engine systems.
In 2009, the U.S. made less than 2 percent of the world's advanced batteries. By 2012, it will make 20 percent, he said.
But makers of both lithium-ion batteries and the cars using them said that any fluctuation between demand and supply will even out quickly as new vehicles with new systems come on the market. In addition, the new production coming on line is geared specifically at the larger battery cells the auto industry will need, and brings key production into the U.S. for its auto industry, rather than relying on existing small-battery-cell production in Asia.
After we've explored everything in a conventional system, the next logical step is in mild hybrids, then strong hybrids and electrics, Nitz said.
And, he noted that the next-generation will make a difference.
They are going to grow up with a completely different sense of vehicles than we have.