German automaker Daimler’s CEO has said that auto giants will face “intense competition” if Apple and Alibaba enter the space.
- Apple and Alibaba are yet to begin selling off their cars; but reports suggest that these tech giants could soon be launching the perfect blend of hardware and software in an electric car.
- Apple is close to finalizing a partnership with Hyundai-Kia to manufacture an Apple-branded EV using a similar business to its iPhone production.
- In January 2021, Chinese automaker SAIC Motor unveiled a new electric vehicle unit called Zhiji under a new brand called IM jointly developed by Alibaba, SAIC, and Shanghai Zhangjiang Hi-Tech Park Development.
- According to reports, IM was expected to accept orders for the first vehicle at the annual Shanghai auto show in April.
The sales figures of electric cars show that the world is moving towards a greener future. 2020 became a great year for these EV makers. According to the Global EV Outlook 2020, the sales of electric cars in 2019 reached 2.1 million globally that surpassed 2018’s numbers. Already 2018 was a record year that boosted the stock to 7.2 million EVs.
Interestingly, what started with an unmatched economic downturn during the first wave of Covid-19 turned into a success story for electric vehicles in Europe. During 2020, 1.4 million Battery Electric Vehicles (BEV) and Plug-in Hybrid Electric Vehicles (PHEV) were registered in Europe. As compared to 2019 figures, there was a 137 percent jump that too in such a market that was already down by 20 percent year-on-year. Experts suggest a combination of new attractive models, the 95g CO2 mandate policy, the incentive dose received by green recovery funds, and an intense advertisement of EVs that drove the market up. Now, Europe seems to have superseded China in the EV growth story.You will find more infographics at Statista
While talking about the EV growth story, we cannot help but want to observe what has been motoring it. With the need for cleaner fuel sources, the automotive industry is undergoing a complete paradigm shift worldwide. With rising fuel prices and alarming pollution levels globally, the auto markets seem to be generously investing in the making of electric mobility infrastructure. Even a recent report by Avendus Capital shows that EVs in India could represent a growing Rs 500 billion opportunity by 2025.
Now, Apple showing keen interest in entering this vast market is expected to cause significant disruptions.
Anticipating the Future of Mobility: iCar
The ‘Apple’ of the Auto industry, Tesla, has earned that name and credibility because of the number of technological innovations it has added to its vehicles. But, now, with Apple in talks with South Korean automaker Hyundai-Kia for manufacturing an Apple-branded electric car, how will that change what Tesla and other automakers mean to the auto world?
If somebody had to give a simple answer to that, there would be none because it is complicated. Apple is quite known for its secrecy, and there has been very little or no information as far as an Apple car is concerned. But, if you had to look at the overall picture, whenever the tech giant entered the new market segments with its phones, music, online streaming, phones, iPods, laptops, etc., it always meant a significant amount of pressure for the legacy companies to match its consumer interface and the products. So, it is doubtful that an iCar would be any different.
But why would Apple enter the auto market? First things first. It is a vast market. New cars top more than $2 trillion in sales worldwide every year. Analysts and close Apple Watchers believe that the giant will stick to only offer higher-end vehicles just like its phones and other gadgets. So, it also means that the iCar’s market will be equal to roughly one-third of the total EV space. It does not seem like Apple would build its cars, and probably the tech giant would prefer to have contract manufacturers to make the car just the way it does with its phones.
Watch: Apple Car: Here’s What We Know So Far
Apple to change the future of mobility?
Many auto analysts believe that Apple will be a good push to the automotive industry to make cars more intelligent. This also indicates that there will be a need for more content per car for suppliers such as Aptiv (APTV) that can integrate the self-driving sensors that are needed for a fully autonomous driving experience. Autonomous vehicles are bound to have so many sensor and computerized types of equipment that one will likely be priced at $80,000 and more.
Industry experts suggest that it could also be one reason why self-driving cars, when launched, might be used as a kind of taxi in the next few years. They would mainly have to generate income enough to justify the investment, and the costs will have to drop before fully self-driving cars would be accessible for regular consumers.You will find more infographics at Statista
Now, this means that the existing car industry gets some time to prepare before Apple makes ripples and decide if they want to win in business or compete with the $2 trillion-dollar company?
Meanwhile, investors across the globe have a keen eye on the company that Apple finally selects to launch its iCar.
Alibaba Charges into the Electric Vehicle World
Alibaba is all set to launch its electric sedan with the wireless mode of charging under IM’s new brand with the state-controlled SAIC Motor. The car unveiled as IM that stands for ‘Intelligence in Motion’, features solid batteries from China’s largest battery maker, Contemporary Amperex Technology, and chips from Nvidia. The new car is expected to park on its own and comes with several smartphone functions. Preorders were expected to begin during the annual Shanghai auto show.
Chinese EVs Vs World EVs
Analysts from Goldman Sachs predicted that new government green policies would mean that electric vehicles will contribute to a larger share of auto sales in Europe and the United States Vs. China in the next four years. Although, China is the largest auto market till now.
After 2020 recorded significant growth in the world’s largest auto market, China’s EV startups are upping their game plans to take on Europe. Recently, even the government authorities began to peel back restrictions on full foreign ownership policies of local auto production in the past few years. But another significant factor to consider is that Beijing started spending billions of dollars on making its own EVs over a decade ago.
Undoubtedly, this has helped local Chinese players edge in producing battery-owned cars aiming to sell worldwide.You will find more infographics at Statista
While the auto world is motoring further into electric power, more traditional German and U.S. car companies are launching their electric vehicles, including many first, in the Chinese market. For instance, General Motors unveiled its Lyric e-car under its Cadillac brand at the Shanghai auto show in April. According to GM, preorders in China are slated to begin later this year. Even Ford revealed its China-made version of the Mustang Mach electric car at the same auto show in Shanghai that would only be available in China.
Volkswagen showcased its third electric car for China called the ID.6 at the Shanghai auto show. Also, the German giant shared that how the company aims to have at least 70 percent of the electric cars sold in Europe and at least 50 percent cars be sold in China and North America.
World of Power Cars
In April, the International Energy Agency (IEA) said that the number of electric cars, vans, heavy trucks, and buses is predicted to reach 145 million by 2030.
The French organization predicted that nearly three million new electric cars were registered last year that made for a record amount and a 41 percent hike compared to 2019. This rise has pushed the total number of EVs to hit the road to the tune of over 10 million. So, the jump in electric car sales witnessed in 2020 still came in even when the global auto market shrunk by 16 percent due to the pandemic effect. In the first quarter of 2021, electric vehicle sales were almost 2.5 times more than during the same period in 2020.
When asked in a recent interview if he has concerns about tech giants like Apple, Alibaba and Google entering the auto industry, Daimler CEO Ola Kallenius had said, “There will be intense competition.” Let’s only see how Apple and Alibaba, and other giants in the auto industry are stepping up to change the future of electric cars in the world.