Issue link: http://resourceworld.uberflip.com/i/963504
18 www.resourceworld.com A P R I L / M A Y 2 0 1 8 ing so fast that the new electrics are much better value than the old, NOT because the old cars are aging poorly. AND THE WINNER IS… You, the consumer will be the winner in this war. You will have the choice of a dramatically different technology in your next vehicle, and the competition between electrics and ICE vehicles will drive the cost of transportation lower. I expect that electrics will gain market share, up to 25% by 2025 simply because government regulation in China, Europe and California will mandate that Zero Emission vehicles must be used in smog burdened cities like Shanghai, Los Angeles and London. Electrics are Zero Emission vehicles, ICE cars are not. China has man- dated that 10% of new vehicle sales in 2019 must be Zero Emission vehicles, so each car manufacturer must sell 10% elec- trics or buy the credits from an electric car manufacturer. Since China is the largest car market in the world, and still growing, there has been a stampede of car manu- facturers building new electric models to comply with this mandate. More than 100 new electric models will hit the market in the next few years of all shapes and sizes. As the car companies pour billions into electric car technology, battery improve- ments in terms of cost and capability will determine the extent of electric vehicle penetration. ICE technology is a mature technology but electric battery technol- ogy is rapidly evolving. The battery in the new electric 2018 Nissan Leaf is twice as powerful as the original model introduced in 2011, but it is the same size. This gives the car twice the range of the original, but at a lower sticker price. This trend will continue. It will be a challenge for ICE manufac- turers and car dealerships to make money on service and parts for electrics, as well as making money selling the vehicles. Electric cars don't need much regular ser- vicing – basically tires and wiper blades. The car companies will be forced into a broader business plans offering transpor- tation as a service. A parallel development complementing the penetration of electric vehicles into the transportation market is the advance of autonomous driving tech- nology. Ultimately, in 10 to 15 years' time, fleets of autonomous electric taxis may satisfy urban transportation needs. Such vehicles could operate continuously, reduc- ing urban parking demand. They may also be refuelled by charging at taxi depots, reducing the infrastructure demands to charge privately owned vehicles. There will be a challenge to commodity producers to supply the enormous amounts of lithium, nickel, cobalt, graphite, cop- per, manganese and vanadium to meet the change in structure of the transportation industry with regards to battery powered vehicles. I think a bull market in those commodities is in front of us to provide the price incentive to supply those materials. n CAR WARS