Welcome to our second blog looking at some of the big changes impacting the automotive industry and assessing how they will shape the future of the industry. In the first part we looked at Brexit and government policy.
In this part, we look at battery development, motorsport and the rise and rise of consumer electronics in auto.
As of this season, casual viewers won’t be able to tune into live F1 races for free on terrestrial TV (with the exception of the British Grand Prix, which will be shown on Channel 4). Sky Sports scooped the remainder of the coverage after signing an exclusive deal to live TV rights in the UK. (Channel 4 will, however, be able to show highlights).
The move raises questions. If F1’s administration thought that taking the money up front was preferable to attracting and nurturing new audiences, is that a tacit admission that the sport’s popularity is waning – making money in the bank preferable to a gamble on future audience growth? Thrilling as it is – and we certainly love it - it’s tempting to see F1 as a metaphor for “old automotive”.
If that’s so, then Formula E is its younger, funkier, more interactive, audience-nurturing sibling. Not only can Formula E viewers elect to give real-time power-boosts to their favourite drivers as they race, but there are even greater platforms for interactivity in the pipeline. Entertainment company Virtually Live has partnered with the sport to take gamification to the next level, using telemetry to replicate races in CGI in real time. This gaming/reality hook-up will allow gamers to participate in the same race as their FE heroes, albeit virtually.
Formula E is demonstrably democratic, not merely acknowledging its audience but inviting it to participate. That it has appointed a woman, Susie Woolf, as a team principle won’t hurt its forward-looking appeal either. It’s impossible to overestimate the importance of interactivity to generations Y and Z: if Formula E fulfils its early promise, it will become a global phenomenon. We confidently predict it will.
Meanwhile, Formula 1 might be about to start getting really interesting. With Honda now partnering Red Bull and the ever-exciting Max Verstappen well established in the team, could the dominance of Mercedes be threatened? That dominance has had an effect on viewing figures and attendance, and we’ve long felt that the sport needs more serious powertrain/constructor partnerships to come to the fore to threaten the duopoly of Ferrari and Mercedes. It seems we might have one on our hands at last – but only time will tell.
Manufacturers are happy to plough money into Formula E, with R&D budgets being channelled into battery propulsion. In the early days of the sport it took two or three cars to complete a circuit, but the systems and technology has developed at an astonishing rate. Now, Formula E is a proving ground for OEMs to test and refine powertrain technology, with an eye to much broader markets.
For all the industry’s prevarication over viable alternatives to combustion-based propulsion, make no mistake: solid state batteries are the key to the kingdom. If a company develops solid state batteries it could become the next Microsoft. Many of the businesses that develop electric consumer products and vehicles are hoping the consumer products will fund and frame their research into battery propulsion itself.
Such is the importance of nailing the EV market that old rivalries are being cast aside as companies pool talent and resources in the search for the perfect blend of technology, talent and production capability – the mooted alliance of Ford and Volkswagen being the most high-profile example. They know that consumers will continue to have their preferred brand, but they may be willing to share powertrain intellectual property in a field where each needs to gain a lot of ground on newer, more innovative rivals.
EV manufacturers need to get their cars down to the £20K-£25K price point before they can shift enough product to recoup costs. The science and discovery behind powertrain is incredible and the talent we see in the controls and software professionals who drive this market is extraordinary. This is one of several modern functional disciplines that challenge very British assumptions about engineering: the new science of powertrain is as smart, vibrant and innovative as anything else you’ll see in modern technology, and so are the key players within the sector.
Battery development is a double-edged sword. The government is doing its bit to accelerate battery development, but its focus on the future might have taken attention away from the fact that we also need short-term fixes. And business leaders are unified in their agreement that hiring talent is the big challenge.
A number of key players within advanced engineering and academia are seeking talent for roles within their battery test and development facilities. Investment into infrastructure will drive this, but it needs to be balanced by investment into people. And though we applaud the huge national drive to make STEM subjects more accessible and appealing to all, home-grown talent alone won’t fix the problem.
Where are these people going to come from? Investment into technological development is great, but not much good at all without the talent to make things happen. Domestic education won’t give us enough people. In the next five years 60,000 engineers will retire, and we need to fill the huge gap in skills and experience that they will leave.
Consumer Electronics and the link to Automotive
A few weeks ago, many of the senior figures within the automotive industry were at CES (the consumer electronics show) in Las Vegas. Once upon a time they would have been seen in motor shows in Paris, Geneva or Shanghai - but never at an event like this.
Today, consumer electronics are a big draw for automotive decision makers and visionaries. It’s not all about powertrains, either: it extends to interior telematics, Advanced Driver Assistance Systems, autonomy, connectivity and the security challenges that arise when passenger vehicles become part of the Internet of Things.
The Detroit motor show more or less coincided with the Vegas event (if you allow for travel and prioritisation of schedules and budgets) and as far as we could tell, seemed to play second fiddle. The annual event – held, let us not forget, in “Motor City” - may even have to move to a different time of year in order to retain its billing as a must-attend.
All modern technological systems, from powertrain to camera and interior technology, need great design, development and control units. And for that, the market needs a clear picture. For the UK to grow as a centre of excellence we need a clear vision. We also need to understand the role that people play in this vision – and that, we submit, is where the team at Gerrell & Hard come in.