D2 THE BULLETIN • SUNDAY, APRIL 25, 2021
Shift to electric vehicles becomes
life-or-death risk for automakers
BY KEITH NAUGHTON • Bloomberg
T
he shift to electric vehicles won’t happen like the flip of a light
Electric vehicles soon to be on the market
switch.
The global auto market for the next two decades will be driven by a
“mosaic” of propulsion systems, including battery power, hydrogen
power, gas-electric hybrids and century-old, petroleum-powered
internal-combustion engines.
That’s the finding of a comprehen-
sive study of the developing electric-ve-
hicle market by consultant KPMG ti-
tled, “Place Your Billion-Dollar Bets
Wisely.” It posits the $200 billion au-
tomakers are pouring into EVs now
— more than what KPMG estimates
NASA spent, adjusted for inflation, to
put a man on the moon — is chasing
sales that will represent 24% to 37% of
the global auto market by 2030.
The fate of automakers will be de-
termined by how executives balance
the decline of the internal-combus-
tion engine with the rise of battery
power, along with other drivetrains. If
electric vehicles achieve 30% market
share by 2030, that will leave the auto
industry with 40 million vehicles of
excess capacity for gas-powered cars
— the equivalent of 200 unneeded
factories.
“The stakes could not be higher,” the
study says. “New dominant positions
will be built, and old empires may fall.”
The changeover to electric will result in
“massive structural change” in the auto
industry, and there is no easy formula
for success.
Betting too big and too early on elec-
tric could leave traditional automakers
without the gas-powered vehicles they
need to keep profits rolling in. But fall-
ing behind on the electric curve could
spell the demise of laggards that cling
to petrol power too long, the study
says.
“Getting the timing wrong is very
risky,” Gary Silberg, the study’s co-au-
thor and global head of KPMG’s auto-
motive practice, said in an interview.
“Getting it wrong by five years, you
could go bankrupt.”
Indeed, Silberg and his co-authors
predict one or two of the world’s top
automakers will fail to navigate the
transition and cease to exist within the
next decade.
“It could even be more,” Silberg said.
“You could have some big crashes.”
For now, too many automakers are
targeting a small sliver of the market
for vehicles priced at $50,000 and up.
General Motors Co. just unveiled an
electric Hummer sport-utility vehi-
cle with a sticker above $100,000 to
complement the Hummer pickup that
starts at $80,000. EV startup Rivian
Automotive Inc. is rolling out a pickup
and SUV this year priced at $75,000.
Vehicles sold above $50,000 represent
just 17% of the U.S. market.
“There are too many players go-
ing after too few consumers,” Silberg
said. “And there’s going to have to be a
shakeout.”
The auto industry is undergoing
a fundamental shift in powertrain
technology to battery electric vehi-
cles from those powered by internal
combustion engines. While there
are a number of gas-electric hybrids,
a host of pure electric vehicles, or
EVs, are about to hit the market.
Currently, there are about a doz-
en-and-a-half EVs being sold, in-
cluding the Audi E-Tron and E-Tron
Sportback, BMW i3, Chevrolet Bolt,
Ford Mustang Mach-E, Honda Clar-
ity, Hyundai Ioniq Electric, Hyundai
Kona Electric, Jaguar I-Pace, Kia Niro
EV, Mini Electric, Nissan Leaf, Polestar
2, Porsche Taycan, and Tesla’s Model
S, Model X, Model E and Model Y.
But there are many more to
come. While there are a number
of startups looking to become the
next Tesla, including Rivian, Lucid,
Byton, Bollinger Motors, Karma,
Nikola, Canoo, Faraday Future and
Lordstown Motors, here’s what’s
coming soon from established
manufacturers.
Stellantis
2023 JEEP WRANGLER MAGNETO: Expected in
early 2022, this battery-powered version of the two-
door Jeep Wrangler Rubicon uses four battery packs
and a six-speed manual transmission to produce
285 horsepower, reaching 60 mph in 6.8 seconds.
But where do you recharge it when you’re off-road
in the middle of nowhere?
— Tribune News Service
2022 GMC HUMMER EV: The
first production vehicle to use
GM’s all-new Ultium battery, the
GMC Hummer EV pickup has a
range of more than 350 miles,
and 625, 800 or 1,000 horse-
power depending on whether
you order one, two or three elec-
tric motors. Super Cruise is stan-
dard. Prices start at $79,995.
Mercedes-Benz AG
2022 MERCEDES-BENZ EQS: Mercedes-Benz is
launching its electric vehicle sub-brand EQ this fall
with the EQS, an electrified rendition of its rede-
signed S-Class flagship sedan. While specifics on its
powertrain haven’t been released, the dashboard
will boast an astonishing “MBUX Hyperscreen,” a 56-
inch wide curved display.
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