Article Type: insight

Electric-vehicle battery development charges ahead

Battery development is central to the electrification of mobility. But which chemical compositions hold the most promise and how will Europe meet manufacturing demand? Autovista24 deputy editor Tom Geggus explores what the future holds for electric-vehicle (EV) batteries.

While lithium-ion batteries currently dominate battery-electric vehicle (BEV) builds, the technology was first commercialised in 1991 for consumer electronics. The rapid development of power-storage units looks set to shift this dependency, however. Speaking with Autovista24, Dr Matthias Simolka, senior technical solution engineer at TWAICE, unpacked how automotive batteries are evolving.

Is sodium a solution?
Demand for lithium is increasing as carmakers look to build more BEVs. While concerns of a potential raw-material shortage circulate, Simolka explained that there is actually enough lithium in the ground. The issue is how many mines are currently up and running, and whether they can meet rising demand.
This is where sodium-ion batteries could prove immensely useful. With different industries currently utilising the material, production capacity is already established. There are additional safety benefits, alongside more sustainable production methods that require less toxic material.

Sodium-ion batteries sport a lower energy and power density, requiring more units to match the kind of power output delivered by lithium-ion versions. However, this makes them ideal for lower demand, less energy dense, and more affordable applications. Chinese manufacturers such as CATL and BYD are already reportedly working on sodium-ion technology.

But this does not mean that sodium will replace lithium as the chemical element of choice. Instead, it will help alleviate pressure alongside other battery setups. ‘Lithium is going to keep on dominating the market,’ Simolka said. ‘I think sodium ion is going to play a role but in specific applications. The benefit of lithium ion is that there are so many different possible setups, so many different cell chemistries you can choose and then adapt to the kind of application you want.’

For example, lithium iron phosphate (LFP) chemical compositions tend not to have a high enough energy density for certain applications. However, adding manganese to the mix, creating lithium manganese iron phosphate (LMFP) can help address this issue. It is with small steps like these that Simolka believes lithium will continue to be the primary player in mobility power storage.#

The solid-state wait
So where does this leave the long-awaited, yet-to-be-delivered solid-state battery
(SSB)? Replacing the liquid electrolyte with a solid one, SSBs promise to revolutionise power storage with greater density, improved safety, and superior sustainability. Progress with the technology is often touted, with some companies even setting large-scale deployment dates as soon as 2025.

But Simolka explained that for this kind of deadline to be met, manufacturers would already be testing mass-market prototypes, which is not something he believes is happening. ‘We are approaching that kind of date when we will see solid state in a mobility application, but I am not very sure it is going to happen in 2025,’ he said.

Even then there is a possibility early editions will belong to a new category of ‘quasi-solid-state batteries’, still using electrolytes on the cathode side of the unit, for example. While this could help improve energy density, it would not fulfil all the promises of SSBs.

Where the technology can be best utilised also needs to be considered. High-power applications make sense, but this would result in sizeable price tags normally only seen attached to luxury models. But as with all manufacturing, costs should lower once processes improve.

Localising supply
COVID-19, cracked supply chains and the conflict in Ukraine seriously damaged production processes. But from these issues arose several valuable lessons about sustainability and localised sourcing. When it comes to essential car components like batteries, time and money are being poured into development and manufacturing hubs in Europe and the United States.

Green group Transport and Environment (T&E) believes the EU can end its reliance on China for lithium-ion battery cells by 2027. Alongside this, two thirds of Europe’s cathode demand could be met locally by 2027.

However, Simolka highlighted that localising production is only part of the equation. ‘You still need to figure out where the materials at the end are coming from,’ he said. Initiatives such as battery passports, designed to verify where materials are sourced, produced and marketed, could help manage this need.
In order to localise the production of batteries, supply chains must be secured alongside all the necessary knowledge to ensure the quality of every unit. Speed is paramount to the development of manufacturing capabilities, but must be balanced with safety and quality.

This content is brought to you by Autovista24.

Have researchers found the key to cleaner diesel power?

Electric-vehicle (EV) development is not the only source of green transformation within the automotive industry. Researchers are also considering how internal-combustion engines (ICEs) could be more sustainable.

A team of engineers based at Australia’s University of New South Wales (UNSW) have converted a diesel engine, with potential industrial applications, into a hydrogen-diesel hybrid engine – reducing CO₂ emissions by more than 85%, and boosting efficiency in the process.

The direct injection dual-fuel system uses a mix of 90% hydrogen and 10% diesel. This means the original diesel injection into the engine can be maintained, with the hydrogen fuel injected directly into the cylinder.

Industrial benefit?

‘Any diesel engine used in trucks and power equipment in the transportation, agriculture and mining industries could ultimately be retrofitted to the new hybrid system in just a couple of months,’ the UNSW researchers claim.

Focusing on the near-future uses of this technology, the UNSW team highlighted its potential industrial applications, as opposed to deployment under the bonnet of a passenger car or van. This includes locations where a permanent hydrogen fuel supply is already in place. For example, mining sites could cut the emissions from industrial diesel engines used in vehicles and generators. The researchers hope to commercialise its new system within the next two years.

‘Being able to retrofit [industrial] diesel engines that are already out there is much quicker than waiting for the development of completely new fuel cell systems that might not be commercially available at a larger scale for at least a decade,’ said professor Shawn Kook from the UNSW school of mechanical and manufacturing engineering. ‘With the problem of carbon emissions and climate change, we need some more immediate solutions to deal with the issue of these many diesel engines currently in use.’

Cleaning up a dirty process

The retrofitted system does not require high-purity hydrogen and was found to be 26% more efficient than existing diesel engines. This technology could prove a vital industrial quick fix while brand-new hydrogen systems are developed over the long term.

A paper published in the International Journal of Hydrogen Energy revealed that the patented hydrogen injection system reduces CO₂ emissions to just 90g/kWh, 85.9% below the amount produced by a standard diesel-powered engine.

‘This new technology significantly reduces CO₂ emissions from existing diesel engines, so it could play a big part in making our carbon footprint much smaller, especially in Australia with all our mining, agriculture and other heavy industries where diesel engines are widely used,’ commented Kook. ‘We have shown that we can take those existing diesel engines and convert them into cleaner engines that burn hydrogen fuel.

This content is brought to you by Autovista24.

Three trends to watch out for as 2022 concludes

Christof Engelskirchen, chief economist of Autovista Group, discusses the easing of supply pressures, the all-time high of used-car prices and how Asian brands may thrive in a more permeable environment.

Central banks are biting down hard on inflation, with limited success so far. Economies are on the brink of a recession and demand has come down notably on both new- and used-car markets.

New-passenger-car registrations in the big five European markets were down 10% year-to-date in September 2022, compared to last year. Yet, August marked a turning point in this downward trend and closed almost 5% higher than a year ago. September continued this trajectory with 8% growth. In Germany for example, there were 14% more new-car registrations than a year ago.

Autovista24 expects 2022 to end below 2021 in terms of new-car registrations – and around 30% below 2019 levels. However, a new-car market recovery is also expected over the coming months as supply pressures begin to ease notably for many car manufacturers, if not for all.

Over the past three years, Autovista24 observed how carmakers were differently exposed to supply-chain issues. Some were more resilient and built market share in that timeframe, for example, Hyundai and Kia. A recovery in 2023 can be expected as more and more carmakers will have successfully tackled some of the imminent supply-chain issues. However, it will not be a rebound scenario. Economic challenges look set to grow and any rise in new-car registrations will be largely due to full orderbooks and pent-up demand from corporate fleets.

New-car market share development in Spain

*Source: National registration offices, Autovista Group analysis*

Used-car markets coming under pressure

After the initial lockdown-induced slowdown in used-car transactions in 2020, there was a strong rebound of sales in 2021. 2022 has obliterated this rebound. The proclaimed used-car market resilience has largely disappeared.

A 10% year-on-year drop in used-car transactions is expected in 2022 for the big five European markets. This represents a 15% contraction when compared with 2019 levels. Europe’s used-car markets are now experiencing the unfavourable combination of a dried-up supply of fresh used cars into the funnel, an outflow of attractive used cars over the past three years, a strong rise in transaction prices, and rising economic pressures. What is more, private buyers are beginning to postpone vehicle replacements.

This creates momentum, which will also likely affect used-car prices over the next months and into 2023. Used car prices are not expected to fall off a cliff in the coming months – supply constraints still prevail; so does inflation of new-car prices. But prices may develop differently depending on age cluster. Days in stock have risen more for older used cars (more than four years old) than for younger ones, relatively consistently across Europe. This can be considered an early indicator of pressure building up on prices for older used vehicles, especially considering they had been rising more than those of younger used cars over the past three years.

Day in stock by age cluster, January 2020 to September 2022

*Source: Residual Value Intelligence; Autovista Group*

Asian carmakers target Europe

Europe used to be a difficult-to-penetrate market for Asian manufacturers, with strong domestic brands and substantial differences in demand between countries. The barriers to entry are lower than initially thought, considering the success that Tesla demonstrates with software-led vehicle architecture and electric-vehicle (EV) powertrain and battery competence.

Asian brands have understood that electrification and infotainment present a more level playing field, where the typical ‘glass ceiling’ between the C- and D-segments (D-segment being dominated by strong, mostly premium, European incumbents; C-segment and below being permeable for non-domestic brands) has disappeared.

‘To date, more than 10 Chinese car manufacturers have launched, or are about to launch, EVs in Europe. Two of them have achieved some initial success: Polestar and MG have made themselves among the top 20 best-selling EVs in Europe,’ Jan Yang, senior managing director at global consulting firm Simon-Kucher, told Autovista24. MG is owned by SAIC Motors and Polestar by Geely, both Chinese businesses.

The inability of incumbent carmakers to supply vehicles in line with demand has also opened new avenues for new players. A recent example is the formation of a ‘long-term partnership’ between Sixt and BYD. Sixt intends to purchase 100,000 electric vehicles from BYD until 2028, which also seems to be a strong reaction to the dried-up supply of cars from European brands into rental channels.

European manufacturers may have successfully leveraged supply constraints to improve margins and prioritise more profitable sales channels, but customers are starting to shop around. There are now competence areas where European brands meet new players on a level playing field – that is infotainment and electrification.

If new (Asian) players can deliver attractively priced and well-performing vehicles, they will not only take market share but also push the supply of cars up, putting pressure on new-car and used-car prices.

Inflation-proof service plans

Established European carmakers should leverage a unique selling point (USP) that is difficult, if not impossible, to replicate: the own-dealer network and the advantages this brings to customers. There are powerful ways to leverage this model to create customer intimacy and loyalty.

A broad physical network can deliver valuable touchpoints for customers and the brand across the entire value chain, from buying to after-sales. More recent examples of tying a customer to the brand via this USP are ‘inflation-proof’ service plans, which some manufacturers have begun offering.

The prerequisite for a successfully combined offline and online sales and marketing value chain is the ability of the customer to move seamlessly between the channels. This will lead the way for a rise in the adoption of the ‘agency’ model for new cars.

How far this agency model extends towards used-car transactions and after-sales is an open question. Whatever decisions carmakers implement, they must strengthen their network if they want to cultivate it as one of the few remaining USPs. They will also need to decide on how much of the asset risks they are willing to absorb as supply pressures ease and residual values become more volatile over the coming months and years.

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Used-car market conditions present cross-border remarketing opportunities

Resilient demand for used cars has created greater opportunities for cross-border remarketing. But there are challenges to overcome, explains Autovista24 senior data journalist Neil King.

The large consumer-to-consumer element of the used-car market, without reliance on physical dealers, means used-car sales fared far better during the COVID-19 pandemic than new-car registrations.
The first wave of the pandemic stopped sales activities at dealerships that were not digital. The less pronounced downturns in subsequent lockdowns exemplify how the establishment, and increased consumer acceptance, of online purchasing has also significantly improved the opportunities for cross-border remarketing.

New-car supply issues have compounded this, with markets such as Spain increasingly relying on imported used cars to meet demand. This phenomenon has also maintained residual values (RVs) in exporting countries such as Poland.

‘There used to be huge imports of used cars from Western Europe into Poland, at the level of about one million units every year. Now it is much more limited, and I can see the opposite trend of exporting the youngest used passenger cars from Poland. This is based on relatively lower market values and the exchange rate, which is approximately 7% higher than before COVID-19,’ commented Marcin Kardas, head of valuations, Eurotax Poland (part of Autovista Group).

Used-car activity has retreated this year and will be affected by the cost-of-living crisis. However, in conjunction with ongoing new-car supply issues, the squeeze on household budgets also means many consumers will invariably turn to more affordable used cars.

Autovista Group’s base case for 2023 anticipates continued supply-chain issues, very low economic growth paired with high uncertainty, and inflation above target zones. This will keep new- and used-car demand under pressure, but new-car registrations should rise compared to 2022. Used-car markets are expected to be stimulated accordingly, as more cars will be supplied.

This does not mean 2023 will be a rebound year for the automotive industry, but cross-border remarketing opportunities remain. The trend towards standardisation of trim-line names and equipment across European market will facilitate the practice too – not only for existing online used-car retailers, but also for dealer groups and even carmakers themselves.

Online used-car retailers

As the internet has become a more acceptable platform for buying used cars quicker than may have been anticipated, this has given rise to several independent online retailers such as Auto1 Group, Cazoo, and Driverama.

In April 2021, Driverama announced its launch as Europe’s first borderless online used-car retailer, pointing to the pandemic as an accelerant that drove people towards online retailing more quickly. The company also noted forecasts stating that by 2030, 20% of all cars bought in Europe will be transacted online.

‘Cross-border remarketing may still be marginal but is growing with the expanse of the internet and English being spoken more widely by the latest generation, which is also less afraid of going abroad to buy a car,’ explained Ludovic Percier, RV and market analyst, Autovista Group France.

‘For example, there is a website in France, Leparking.fr, which collects all used-car adverts across websites worldwide to help you find the right car. You can select the countries you are interested in or even the distance from your location. For people living in the centre of western Europe, this can lead them to many foreign countries, sometimes closer than the other end of their own country. The key factors in going abroad are a lower price, more choice, and sometimes proximity.’

Aside from individual buyers travelling to source a car, the ongoing supply shortages, and increased consumer willingness to purchase online, create significant opportunities for market players when it comes to cross-border remarketing. However, not all consumers are prepared to travel internationally and deal with the bureaucracy involved, so a local presence is required. But this requires scale, which is the core reason Cazoo cites for its withdrawal from the mainland European market.

‘Following a review of a range of strategic options, management has concluded that the right course of action is for Cazoo to now focus exclusively on its core opportunity in the UK, an enormous addressable market with approximately eight million used-car transactions and a value of over £100 billion annually,’ Cazoo announced on 8 September.

‘The plan to withdraw from the EU is based on the material further investment that would be required for Cazoo to continue to scale its operations in the EU and the conflict this has with the company’s priorities of cash conservation and achieving profitability without the need for additional capital. As a result, the company intends to commence an orderly wind down of its operations in Germany and Spain and is in consultation with its employee representatives in France and Italy.’

Another key challenge for online used-car retailers is sourcing cars, especially as they scale operations and enter new markets. One solution is to establish relationships to gain access to de-fleeted vehicles.
In February for example, Auto1 Group, one of Europe’s largest online retailers for buying and selling used cars, struck a deal with Munich-based Allane Mobility – formerly known as Sixt Leasing – to secure supply of around 10,000 leased-car returns and fleet vehicles per year.

Standardisation of equipment and trim-line names

Scale is less of an issue for established large dealer groups and carmakers’ own dealer networks. They may be hampered by borders, but this does not mean that cars cannot be sourced elsewhere. One key challenge, however, is the inconsistent naming conventions of trimlines and/or standard equipment.
‘The Volkswagen trim line Carat in France for example means nothing in Germany, Specifications may differ, but consistent version names at least add clarity,’ commented Andreas Geilenbruegge, head of valuations and insights at Schwacke (part of Autovista Group).

This inconsistency in both trim-line names and standard equipment has not passed carmakers by, with Geilenbruegge pointing to heated seats as an example. They are not essential equipment in new cars in southern European markets such as Spain, but their absence limits a car’s remarketing opportunity in northern Europe. Carmakers are therefore looking at measures such as introducing seat heaters as standard equipment across Europe from the second trim line upwards.

This may not entirely remove international prejudice, whereby cars registered new in one country are often valued lower than those registered domestically.

‘A car bought new in Germany and driven its whole life in France is not worth the same to a dealer as the same car with the same specifications registered new in France. So, consumers risk losing money when trading in cars imported to France compared to a car bought new in the country,’ Percier commented.
Conversely, consumers may be unwilling to pay the same amount for an imported used car as one that has only been registered in their home country.

One manufacturer that has swerved inconsistent trim-line names and specifications – and seemingly international prejudice too – is Tesla. This has facilitated the widely reported exporting of used models from Germany to Norway for example.

‘We are heading towards a future universal European market and some carmakers, such as Tesla, are already uniformising their offer to sell cars wherever the demand is high and the offer low. Most people will still buy a car in their own country, so brands must adapt to providing cars where they are needed. This is true for the European market but also in the local market, between areas and cities,’ said Percier.

Carmakers as used-car agents?

Looking ahead, Percier noted that features on demand (FOD) may eradicate the differences in standard equipment across markets. ‘With the coming FOD in cars, everybody will be capable of activating any option on the car, even after five years. The only differences will be the engine, gearbox, and the car’s aesthetics – that is it.’

With consistent trim lines and equipment, there is greater scope for carmakers to enter the realm of cross-border remarketing themselves. One approach could be an agency model, whereby carmakers can actively offer to purchase cars from a dealer when there is higher demand in another country. This also works passively, however, with dealers able to identify cars that are available for sale across the carmakers’ European dealer network. They can then source them, with the carmaker assuming responsibility for the paperwork, financial transaction, and logistical arrangements.

Whatever the future holds, cross-border remarketing is here to stay and will only gain momentum as transparency increases, both in terms of standardised equipment and names, as well as online presence.

This content is brought to you by Autovista24.

Launch Report: The Mercedes-Benz EQE electrifies the executive-saloon market

Mercedes-Benz has extended its line-up of EQ battery-electric vehicles (BEVs) with the EQE. Like the EQS, it features an aerodynamic and modest, but pleasing, ‘one-bow’ design. However, rear headroom is compromised by the sloping roofline and standard-fit panoramic roof. Similarly, the small side and rear windows, developed for aerodynamic and design purposes, reduce visibility, making the rear-view camera essential.

The chassis and suspension of the EQE are designed to be very comfortable, but also allow for more dynamic driving. The front bumper is not too low, making driving over speed bumps in urban areas easier. Additionally, the EQE’s ride height can be set and saved in the GPS to adjust every time the car takes a particular route.

The car has high perceived quality – the materials used for the dashboard, doors, and seats are first-class. The optional MBUX Hyperscreen, which extends across the entire width of the interior, is stunning, although it is only available in limited quantities because of the semiconductor shortage. The two standard displays, which resemble those in the S-Class, are also convincing and the advanced driver-assistance systems (ADAS), including an augmented-reality head up display, are all state of the art.

Electrifying the E-segment

The executive segment (E-segment) has been in decline in recent years as consumers increasingly favour SUVs. As a four-door saloon, the all-electric counterpart of the E-Class currently has no direct rivals in the segment. Estate and/or shooting brake versions of the EQE are lacking. These still account for more than 60% of the overall segment and 70% of its fleet registrations in Germany, for example. The forthcoming EQE SUV – essentially a BEV variant of the GLE – will help plug the gap, but comes with a risk of cannibalisation.

On the plus side, Mercedes-Benz is now offering a full range of powertrains in the segment as the E-Class is available with petrol and diesel engines, as well as a plug-in hybrid (PHEV) drivetrain. As the variety of electric models in the E-segment is still very limited, the EQE’s long range (up to 639km in the 350+ version with a 90.6kWh battery) will appeal to its target audience. This is one of the highest ranges in the segment, exceeding that of cars with similar pricing.

Click to open the interactive dashboard

The 400V on-board network means a DC charging capacity of up to 170kW should be possible, resulting in the battery recharging from 10% to 80% in 32 minutes. This is slightly disadvantageous compared to the 800V technology of the Audi e-Tron GT, Porsche Taycan, and some other newcomers. A larger battery is not available for the EQE, as is the case with the EQS, due to the wheelbase being 9cm shorter.

Converting E-Class owners

The wheelbase of the Mercedes-Benz EQE is over 30cm longer than the E-Class, offering generous space in all seats, and the EQE350 has 245Nm more torque than the AMG E53 E-Class (765Nm vs 520Nm).

The towing capacity of the EQE is only 750kg, compared to a maximum of 2.1 tonnes for the E-Class. Similarly, the 430-litre boot is 110 litres smaller than in the E-Class, whereas the EQS is a hatchback with 70 litres more capacity than the S-Class. There is no additional storage space under the bonnet because of a high-efficiency particulate-absorbing (HEPA) filter, which ensures clean air in the interior. This means the charging cables are stored below the boot floor, which makes charging inconvenient when the car is loaded with luggage.

Overall, the EQE should help Mercedes to retain current E-Class owners that want to, or in fact need to, switch to a BEV. Nevertheless, aside from SUVs, the EQE will face strong competition from the Tesla Model S when versions below the Plaid become available again. The Tesla was the first BEV offered in the E-segment, comes with a strong brand image, and has been regularly updated with facelifts.

Furthermore, BMW will soon start deliveries of the i7, and the i5 has been announced for 2023. An Audi A6 e-Tron, with 800V architecture and a range of over 700km, will be launched in 2024 as both a saloon and an estate. Other premium competitors, such as Volvo and Jaguar Land Rover, are investing millions in electromobility, and Asian manufacturers, including Hyundai’s premium brand Genesis, are pushing into Europe too.

View the Autovista Group dashboard, which benchmarks the Mercedes-Benz EQE in Austria, France, Germany, and the UK for more details. The interactive launch report presents new prices, forecast residual values, and SWOT (strengths, weaknesses, opportunities, and threats) analysis.

This content is brought to you by Autovista24.

Sustainable materials are driving change in the automotive industry

Autovista24 journalist Rebeka Shaid investigates how the use of sustainable materials is transforming the automotive industry.

Cork, coconut fibre, coffee grounds – the automotive industry is moving away from traditional materials that are difficult to recycle. The focus is instead shifting to more sustainable resources. While electromobility is key to slashing carbon emissions, the products that go into a car also matter.

Electrifying powertrains are one way to help decarbonise the lifecycle of a vehicle, but more needs to be done to reduce material emissions. Consulting firm McKinsey estimates that 60% of automotive-industry emissions by 2040 will come from materials used in production, so stepping up decarbonisation efforts in this area is key.

‘Vegan’ leather

Replacing leather with ‘vegan’ alternatives sits at the top of the list for many manufacturers. The idea is not new as carmakers have been using faux or synthetic leather for years. But automotive companies want to take this to the next level by offering greener options. The advantage is that vegan leather can be made from all sorts of natural resources, such as mushrooms or pineapple waste, so the sourcing potential is great.

Swedish carmaker Volvo has vowed to make its electric-vehicle range vegan-friendly by 2030 and other premium manufacturers are eager to explore sustainable leather alternatives as well. BMW is collaborating with Desserto, a company that creates a cactus-based biomaterial, which can replace leather in seats and panels. The material is cruelty-free certified and could help to reduce the environmental impact in product manufacturing, the company said.

The plant-based product, known as Deserttex, promises quality, and the company behind it – Adriano Di Marti – is targeting premium brands to provide them with a product that performs to the expected standards. Luxury automotive brands have taken notice as Dessertex can be found in the upholstery of Mercedes-Benz’s Vision EQXX concept car.

‘The automotive industry is racing into a new world of possibilities around sustainability and mobility — and biotechnology applied to interior materials can significantly contribute,’ Adrian Lopez Velarde, co-founder of Desserto, told Autovista24. ‘In a fast-changing, highly-competitive landscape, Adriano Di Marti is collaborating and innovating with OEMs to accelerate progress on the industry sustainability goals, and we are seeing results.’

Recycled materials

It is not just about vegan leather though, there is also plastic – a material known for its environmental unfriendliness. So how can carmakers make this material more sustainable? Through recycling. Discarded polyethylene terephthalate (PET) bottles or plastic caps have found their way into vehicle interiors, from the dashboard to foam seats and air bags.

Plastic remains a popular material for car manufacturers as it reduces the weight and cost of vehicles while also increasing performance. Around a third of the 30,000 parts used in new vehicles are made from plastic, so recycling the product makes sense from an environmental point of view.

Audi is interested in recycling automotive plastic and last year got involved in a chemical-recycling pilot project in Germany. Considering that on average 250kg of plastic are used in an Audi model, the company sees the re-use of mixed plastic waste as promising.

‘Audi is aware of its responsibility when dealing with resources. This includes the entire lifecycle of a car, from the selection of materials in the design to the materials used in production and the use-phase to the recycling of raw materials. Environmentally friendly materials are already playing a major role in our series models, because a beautiful look and pleasant feel are no longer enough,’ Audi told Autovista24.

The Audi Q4 e-tron boasts a high proportion of recycled materials, comprising up to 27 components that contain recycled material. Meanwhile, floor carpets and mats in the Audi e-tron GT are made from econyl, which consists of up of 100% recycled nylon fibres constructed from production waste or old fishing nets. In the Audi A3, up to 89% of the textile used originates from recycled PET bottles.

While recycling materials can initially be more expensive, this can be compensated for in the long run, Audi added. ‘The most valuable materials are those that can be recycled again and again with little or no loss of quality,’ the company said.

A plastic alternative

Car manufacturers are increasing their decarbonisation efforts with vigour, not least because consumers are demanding more sustainable products. But eco-friendly materials do not only have to be ‘green’, they also need to be appealing to the eye and do their job by being durable.

A startup that aims to fulfil these criteria by providing an ecological alternative to plastic is Germany-based Karuun. The company uses rattan, a non-timber product from Indonesia, with the raw material harvested manually before being processed on-site. It has won over notable partners from the automotive industry, including Jaguar Land Rover and Chinese electric-vehicle maker Nio.

‘The quality standards in the automotive industry are among the highest in the industry, meaning that only the best material innovations will be able to be incorporated into a series product,’ Karuun CEO Felix Grüneberger told Autovista24.

‘There is no question that natural materials often require different handling during processing, which may necessitate process adjustments. However, customers can rely on the high quality they are accustomed to from their car brand,’ Grüneberger added.

Saving weight, energy, and emissions

Bio-based materials can also help to minimise weight and increase both energy and emissions savings. The automotive products of green-materials company Bcomp are based on natural-fibre reinforcements for sustainable lightweighting – the concept of reducing vehicle weight to improve performance and efficiency.

Christian Fischer, Bcomp’s CEO, told Autovista24 that sustainable transport is more than electrification. ‘One of the major drivers for sustainability in all transport sectors is lightweighting. Making cars lighter is the most effective way of reducing their energy consumption, regardless of how they are powered,’ he said.

The company has won over notable investors, including BMW, Porsche and Volvo. Its products can cut weight by up to 50% and plastic by 70% in interior panels while also being able to reduce CO₂ emissions by 60%. Flax fibres form the base of the components, with the fabrics made from plants in Europe. The fibres can replace plastic, carbon, and glass fibres, which are emissions-intensive to produce.

The European Commission recently launched an initiative, known as IRISS, to speed up the transition to sustainably designed materials, products, and processes. CLEPA, the European association of automotive suppliers, joined the three-year project in which the EU is investing more than €3.5 million.

CLEPA’s role is to analyse safe-and-sustainable-by-design criteria, as well as look at research needs and opportunities for implementation in the automotive sector. The association told Autovista24 that Europe’s Green Deal policies are focused on rethinking the way materials are selected, extracted, and incorporated into products.

‘Lightweight materials allow for fuel savings by reducing the vehicle weight but may be more difficult to recycle. So frequently in automotive applications, it is necessary to choose between a resistant and lightweight material and one that is recyclable but with worse technical performance. In practice, the choice is driven by a complex balance between consumer expectations, performance requirements and safety standards, life-cycle analysis, and the increasingly dominant need for circularity. As the concept and scope of sustainability evolves, the balance of trade-off in the automotive industry is shifting, making a clear strategy on sustainable materials a necessity,’ it said.

CLEPA added that the IRISS project would identify the gaps in knowledge and skills for the uptake of a safe-and-sustainable-by-design concept in industrial applications. The focus will also be on materials manufacturing and how these materials behave during the design phase to increase durability.

Carmakers are on their way to carbon neutrality and getting there means building vehicles that rely on greener and sustainably sourced materials that are both renewable and recyclable. With manufacturers working towards on cleaner cars, the path to sustainability remains a challenging one, but sustainable materials can play a big part.

‘Using less material, and materials that are more sustainable is key,’ said Fischer. ‘By 2030, sustainable high-performance materials should be the norm and we are moving away from fossil-based materials wherever possible while also making sure that materials are used, reused, and recycled for as long as possible, and taken care of as efficiently as possible at end of life.’

Can e-fuels save the internal-combustion engine?

E-fuels are being touted as a carbon-neutral alternative that some hope could keep internal-combustion engine (ICE) cars on the roads despite a looming ban, writes Autovista24 journalist Rebeka Shaid.

Do we want to save the planet or the internal-combustion engine? That question might sound provocative, but policies around transportation and mobility have centred on the environmental impact of diesel and petrol cars for years.

Fully-electric vehicles are seen as the solution as they have no tailpipe emissions. Still, ICE cars will not disappear from the roads in Europe any time soon, despite the EU planning to phase out the sale of new fossil-fuel-powered vehicles by 2035. This is where e-fuels come in – combustibles that have found both fans and critics.

What are e-fuels?

Simply put, e-fuels are synthetic fuels with their production based on hydrogen and CO₂. Labelled as climate-neutral, these fuels use carbon dioxide from the atmosphere and can, ideally, be produced using renewable energy resources.

Proponents, including automotive associations and some carmakers, argue e-fuels can relieve the climate of CO₂ and may replace conventional fuels altogether. E-fuels also have a high energy density, are easy to store, and can be distributed by an already existing network of petrol stations.

Advocates tend to pitch synthetic fuels as a sustainable way to transform the transport sector. The eFuel alliance, whose members include numerous automotive suppliers such as Bosch, Mahle, and ZF, told Autovista24: ‘We strongly believe that the climate targets cannot be achieved without e-fuels. E-fuels are climate friendly, contrary to what critics claim. To produce e-fuels, CO₂ is used from the air and liquefied using water and renewable energy.’

Mazda was the first carmaker to join the alliance, arguing that CO₂-neutral fuels could contribute to automotive manufacturers’ emissions reduction efforts. With the EU reviewing carbon emissions standards for cars and vans, e-fuels have once again become a hotly debated topic.

Opinions are split

In Germany, transport minister Volker Wissing recently emphasised that new ICE cars should still be relevant beyond 2035 if they can be topped up with e-fuels. This opinion has caused a rift, not only among politicians but also among carmakers.

Volvo Cars is leaving the European Automobile Manufacturers’ Association (ACEA) because its sustainability strategy does not match ACEA’s. The powerful lobbying group supports the use of what it calls CO₂-neutral fuels while the Swedish car manufacturer is betting on an all-electric future.

Others are not jumping ship despite considering the future of mobility to be broadly electric. Mercedes-Benz told Autovista24 that while it is preparing to go fully-electric by 2030 where market conditions allow, it was: ‘intensively involved in ACEA’s positioning on the EU Commission’s “Fit for 55” legislative initiative.’ The manufacturer added it was ‘continuously committed to a more progressive positioning of ACEA on the way to climate-neutral mobility.’

Meanwhile, German rival BMW wants to keep its options open. The group’s CEO Oliver Zipse is backing the use of e-fuels as opinions on them remain divided – even within the same company.

The head of Volkswagen (VW) Group, Herbert Diess, told a German media outlet that the efficiency of synthetic fuels was extremely poor. He also questioned the cost effectiveness and high-energy consumption required to produce them.

VW subsidiary Audi once seemed convinced by e-fuels but appears to have changed tack, saying synthetic fuels are not the future. But Porsche, which has been part of VW Group for more than a decade, is still heavily investing in the synthetic fuel. The sportscar maker has teamed up with Siemens Energy and other companies to build an industrial plant in Chile, which will be dedicated to the production of an ‘almost carbon-neutral e-fuel.’

Porsche plans for 80% of its sales to be made up electric vehicles (EVs) by 2030. The company told Autovista24: ‘Climate protection must be considered holistically. Synthetic fuels are a useful addition to electromobility to make a contribution to CO₂ reduction. We must also offer the owners of existing vehicles a perspective. Compared to pure hydrogen, e-fuels made from water and carbon dioxide extracted from the air for automobiles, airplanes or ships have the advantage that they can be transported more easily.’

While Germany’s carmakers are following different approaches, the country’s powerful association of the automotive industry (VDA) is in favour of synthetic fuels. ‘E-fuels could become a permanent fixture in transport in the future and make an important contribution to climate protection,’ it states.

Is carbon-neutrality enough?

After a key meeting among environment ministers last month to debate the phase-out of ICE cars in Europe, the EU has now left a door open for carbon-neutral fuels. In other words: synthetic fuels could be used past the 2035 deadline.

A spokesperson for the European Council told Autovista24 that the agreement: ‘includes a recital, giving the possibility to the Commission to make a new proposal to allow the use of CO_2-neutral fuels beyond 2035.’

Supporters of e-fuels want to keep the internal-combustion engine alive. After all, synthetic fuels could not only continue to power ordinary passenger cars, but also hyper- and sportscars, with Porsche planning to use synthetic fuels in motorsports. But this approach does not come without criticism.

Synthetic fuels will likely be considered in sectors where electrification is currently not plausible, but critics warn that the automotive use of e-fuels would send the wrong signal to car manufacturers and consumers. They suggest that using synthetic fuels in the long term would do more harm than good and delay the transformation to electromobility.

The shortcomings

There are clear downsides to e-fuels, as campaigners point out that these fuels still emit pollutants. Energy loss is also an issue as the efficiency of e-fuels is lower compared to battery-electric vehicles (BEVs). Energy gets lost when converting electricity into synthetic fuel, giving these combustibles an efficiency of around 15%.

To make e-fuels carbon neutral, renewable energy has to be used. This would mean depending on countries that have the capacity to produce enough green electricity. Additionally, producing e-fuels is expensive and consumers are going to feel those costs.

‘The production cost of the amount of e-fuels required for driving a combustion engine car 100km is nearly 10 times the production cost of the amount of renewable electricity for driving a battery-electric car the same distance,’ according to the International Council on Clean Transportation (ICCT).

The eFuel alliance is rejecting critics and told Autovista24: ‘The biggest criticism levelled against e-fuels is the apparent inefficiency, because a lot of renewable electricity is needed to produce e-fuels. However, this argument can be invalidated if we think globally. E-fuels can be produced worldwide in places with abundant sun and wind and transported via the existing infrastructure.’

So, will e-fuels be able to save the combustion engine? The German Climate Alliance told Autovista24 that synthetic fuels would, at most, be a niche in the future.

‘E-fuels are not yet available in significant quantities, are inefficient and very expensive. The best alternative – it is cheap, efficient and can already be implemented today – is called electrification. E-fuels only make a contribution to climate protection if it can be guaranteed that they are actually produced exclusively with renewable electricity and are only used where there are no better alternatives. This is not the case on the road.’

Synthetic fuels may provide a lifeline for companies that have their business models threatened as the industry switches to electric. These fuels could potentially have their merits under the condition that their production relies solely on renewable energy. They would also need to be accessible and economical. But even if these criteria are met, it does not mean e-fuels are good for the environment. Realistically, they might only be used as a bridging technology.

Roadmap drawn up for global green-hydrogen exchange

A group of German-based companies, alongside Australia’s Fortescue Future Industries (FFI), have outlined a set of recommendations designed to meet the ambitious target of moving large quantities of green hydrogen from Australia to Germany.

Created earlier this year, the green hydrogen taskforce is a collaborative effort between FFI, and a host of German energy companies. This includes Covestro, E.On, Linde, Luthardt, SAP, Schaeffler, Thyssenkrupp Nucera and Thyssenkrupp Uhde.

With numerous countries across the EU looking to phase out internal-combustion engines (ICE), carmakers and policymakers have broadened their focus out across electric vehicles (EVs) and are looking towards hydrogen as a viable energy source.

Earlier this year, Bosch announced plans to develop electrolysers for green-hydrogen production, as well as sharing its hydrogen expertise regarding hydrogen refuelling-infrastructure technology. Hyundai and Italian transport vehicle maker Iveco Group signed a memorandum of understanding (MoU) to develop a range of automotive technologies, including hydrogen power.

Meanwhile, BMW has underlined its commitment to exploring hydrogen powertrains in its vehicles, and Renault unveiled its Scenic Vision concept-car which features a hybrid-mobility system, using both electric and hydrogen, to offer zero-carbon travel.

Hydrogen-powered mobility is in its relative infancy, however, recent infrastructure developments across the world have increased the need to obtain access to the fuel. Earlier this year it was announced that in 2021, a record number of hydrogen-refuelling stations opened around the world, equating to 33 countries where hydrogen refuelling is possible.

As this figure grows and different types of vehicles switch to hydrogen, the roadmap will help the EU capitalise on short-term opportunities across increasingly volatile global energy markets. This will potentially safeguard energy security while achieving ongoing decarbonisation objectives.

Motivating factors for the green-hydrogen roadmap include addressing the impact of climate change. FFI cites a UN IPCC report, which recommends reducing fossil-fuel production to keep temperature increases under 1.5 degrees, and halting the worst impacts of global warming as a motivating factor.

Additionally, the war in Ukraine has influenced the creation of the roadmap by creating a ‘new reality’ that must be addressed through an accelerated energy transition. The whitepaper highlights the development of a green-hydrogen economy, helping to decarbonise as well as diversify energy supply.

FFI and energy providers E.On, recently announced a partnership with the goal to supply five million tonnes of green hydrogen a year by 2030 – the equivalent of one third of the calorific energy of natural gas that Germany imports from Russia.

According to the report, by 2030, the price of carbon will likely reach a sufficient threshold for imported green hydrogen to be competitive with fossil fuels, negating the need for any further subsidies. The EU states that demand for hydrogen is set to rise to around 10 million metric tonnes a year by 2030.

‘The envisaged hydrogen partnership between Germany and Australia is a vital step to foster clean energy in Germany,’ commented Uwe Wagner, CTO of Schaeffler. ‘To turn this goal into reality, quick industrialisation of electrolysis and other hydrogen technologies will be crucial. We stand ready to speed up the energy transition with the supply of high-quality components for the large-scale production of electrolysers.’

What is green hydrogen?

Green hydrogen uses only renewable energy, such as solar or wind power in its production phase. This means that almost no CO₂emissions are produced, and this is key to the future of hydrogen production as other variants are not as sustainable.

Grey hydrogen is currently the most widely used form of the fuel and uses natural gas or methane without trapping resultant greenhouse gasses. Blue hydrogen uses mainly natural gas, but does trap the resultant CO₂. Meanwhile, brown hydrogen uses fossil fuels, and is the most environmentally damaging version.

The white paper states that green ammonia is a key route for green hydrogen to be supplied to EU markets. Existing infrastructure can be leveraged and expanded, and safe handling of ammonia is well established.

‘If structured appropriately, an accelerated uptake of green hydrogen also by means of green ammonia can be a powerful economic growth driver for Germany,’ stated Dr Andrew Forrest, chairman of FFI. ‘Our white paper estimates that for every €1 spent as a support mechanism by Government for green hydrogen, €10 is unlocked in private investment.’

Once common standards and robust financial mechanisms are in place, stakeholders across the green-hydrogen value chain can agree on contracts and ensure production, transport, storage, and conversion facilities are ramped up at the scale required to meet deployment targets.

Enyaq Coupé or not Coupé – which would you choose?

Autovista24 principal analyst Sonja Nehls and market analyst Dennis Borscheid look back at the success of the Skoda Enyaq and give a remarketing outlook for the new Skoda Enyaq Coupé.

The Enyaq Coupé RS iV builds on the strengths of the Enyaq iV SUV. Despite the sportier silhouette, the Skoda-typical roominess is not noticeably compromised.

The steep entry price of the Coupé RS version is justified by the comprehensive standard equipment, it comes at a convincing cost-performance and is a great package overall.

Flaws in terms of top speed or DC-charging capacity did not keep the Skoda Enyaq SUV from becoming the best-selling electric C-SUV in Germany in 2021. They will also not pose a major threat to new-car sales of the Skoda Enyaq Coupé now and the remarketing outlook is promising.

Skoda Enyaq Coupé remarketing potential

Remarketing upsides	Remarketing downsides
True to Skoda brand characteristics with lots of space and practical solutions	Long delivery times, leading to belated entry into UC market
Timeless design, unlikely to age quickly	Risk of cannibalisation with similarly positioned ID.5
Comprehensive standard equipment on the RS version	Comparably slow DC-charging capacity of only 135kW
Long range of 499km

The Enyaq Coupé follows the Skoda Enyaq which was launched two years ago. As is the fashion, especially with battery-electric vehicles (BEVs), this derivative follow-up features a more dynamic design thanks to its strongly-sloping roofline.

The Enyaq already has an impressive track record, being the seventh best-selling BEV in Europe in 2021 and the third-best selling electric C-SUV. In Germany it even reached the number one spot among electric C-SUVs and overtook the Volkswagen ID.4 in its domestic market, an impressive achievement.

Our experts at EV-volumes.com expect the Enyaq and Enyaq Coupé to grow their joint annual sales volume in Europe to 95,000 units by 2026.

Delivery issues fuel competition

The compact- to medium-sized SUV segment has become the focal point of attention in the BEV market, with more and more models launched. The Enyaq Coupé therefore faces tough competition, especially from the likes of Volkswagen’s ID.5, the Tesla Model Y, the acclaimed Hyundai Ioniq 5 and the muscular Ford Mach-E.

New players are also entering the market, trying to claim a slice of the cake. These rivals, for example MG and its Marvel R, apparently can deliver their cars sooner than some of the established brands. Availability and attractive price points put brands like MG on the table with fleets and leasing companies, which currently struggle to secure enough cars from the European marques.

Furthermore, those leasing or subscribing to a car do not carry the remarketing risk, and are more willing to give new brands a try.

Delivery times will be a burden for the Enyaq Coupé as they already are for the Enyaq SUV. Customers seeking to buy an Enyaq must wait up to two years, and it is unlikely the Coupé version will have shorter delivery times.

At this point there is a lot of uncertainty around the level of BEV incentives likely to be available at the time of future registration, and whether the models ordered now and delivered much later will already feature upgraded specs.

In any case, there is a risk of models getting old before their time. Over-the-air updates and functions-on-demand at least can help keep the software-based features up-to-date.

True to family values

Simply clever. If Skoda had a family crest, it would sport this slogan, the very distillation of what makes Skoda models special across all segments, powertrains, or fuel types. And the Enyaq Coupé is no exception.

Following in the footsteps of the Enyaq SUV, it sports the same smart solutions, such as lots of storage spaces and the umbrella and ice-scraper holders.

Also, interior roominess and boot volume are excellent and exceed most rivals. For example, the boot volume is only 15 litres smaller than on the SUV, and although the sloping roofline takes away some of the headroom, it is still a comfortable place, even for taller people.

The smallest turning circle of compared models is another real asset, especially for inner-city driving. The towing capacity of 1,200kg stays below Hyundai’s and Tesla’s 1,600kg but is sufficient for most users, especially given that a premium model like the Mercedes-Benz EQB does not have any towing capacity.

Specifications and dimensions versus main rivals

Click to expand (opens in new tab)
Source: Autovista Group specification data

The Enyaq Coupé adds a few interesting features to the mature and timeless design already established by the Enyaq SUV. The lateral view is different from that of the SUV version, thanks to the sloping roofline, which ends in a sharp drop at the rear. The large 20-inch wheels complete the sporty and dynamic look.

Also, the fully-functional air intakes help to lower the drag coefficient to 0.234 and therefore add a few extra kilometres of range. The ID.5, which is built on the same platform, has a cw-value of 0.26 which in the world of BEVs puts miles between the two.

Strong range, but slow charging

The Enyaq Coupé is currently only available as an RS variant, a guarantee for driving pleasure and sportiness. As with most rivals, except for Tesla, top speed is limited to around 180kmh and the 460Nm of torque fall a bit short compared to the 580Nm of the Mach-E, or the 605Nm the Ioniq 5.

But for BEVs, even for the sportier ones, acceleration and top speed are not everything.

Most customers will care more about how far they get on a single charge and how long it takes to get going again once the battery is depleted. The Enyaq Coupé’s 499km of range is only exceeded by the Tesla Model Y’s 533km, but the 135kW DC-charging capacity places it at the bottom of the league.

BEV specifications vs. main rivals

The comparably low DC-charging speed of 135kW can pose a minor risk for residual values as future used-car buyers will see it even less favourably in three years’ time due to advanced technology and higher market standards.

Almost fully equipped

Skoda has not held back on standard equipment on the Enyaq Coupé iV RS and even went above and beyond the offering of the SUV version’s highest trim (80x). This comprehensive equipment offer explains the steep starting price of the RS, €4,300 above the entry price of the ID.5 GTX in Germany, at €57,700.

It comes with a panoramic roof, advanced driver-assistance systems, matrix headlights and 20-inch wheels as standard. Once configured to a comparable equipment level, the Hyundai Ioniq 5, Mustang Mach-E and Tesla Model Y are 7-15% more expensive.

However, it may not go unmentioned that a like-for-like comparison is very challenging at the moment due to the implications of the semiconductor shortages and general supply issues. Available options on the car makers’ websites change almost on a daily basis.

By offering an attractively-priced and comprehensively-equipped model, Skoda avoids two pitfalls at the same time. First, there is no risk of ill-equipped Enyaq Coupé RS models coming to the market. Second, identification of future used RS trims will be easy and transparent. Unfortunately, it is likely that upcoming lower-powered versions will fall victim to these pitfalls, as they have for the Enyaq SUV.

A promising outlook

Residual values for the Enyaq Coupé are off to a strong start with especially high forecasts in the UK, coming in at 61% or £31,755 (€37,404) after three years and 60,000km. Despite a slightly lower forecast in Germany, the depreciation is equally low as in the UK due to a difference in list price of over €3,000.

Skoda Enyaq Coupé RS iV RV forecast, 36mth/60kkm, June 2022

Open the interactive dashboard

While the RV forecast stays below the one for the Volkswagen ID.5 GTX in Austria, Switzerland and the UK, the Enyaq Coupé impressively exceeds its cousin by more than €2,500 in Germany.

Open the interactive dashboard

The interactive dashboard gives a more detailed cross-country overview and benchmarks the Enyaq Coupé’s residual value and depreciation against comparable models in the markets.

The better Volkswagen?

When asking industry experts for their recommendations on which BEV to buy, the Skoda Enyaq comes up a lot. The Enyaq Coupé will complement it, for people who prefer the more dynamic look. It simply is a great package and long gone are the times when models of the brand were considered lower-quality budget versions of Volkswagen vehicles.

However, the Skoda Enyaq might well be the last to outperform its Volkswagen equivalents following plans made in 2019 to reposition the Skoda brand.

In October 2019 Herbert Diess, chairman of the board at Volkswagen Group, told the Süddeutsche Zeitung that all parties suffer if three or four brands fight for the same target group with similar products. In the second half of 2022 Skoda will share more details on their new strategy, called Modern Solid.

We can expect to see some aspects of the brand’s repositioning coming to life then, likely with a clearer differentiation to Volkswagen.

Tesla signs major lithium supply deal

Australian lithium producer Core Lithium has signed a supply deal with Tesla. The Northern Territory-based company will provide 110,000 tonnes of lithium-concentrate to the US-based carmaker over a period of four years.

The binding term sheet will specifically see lithium spodumene concentrate from Core’s Finniss Lithium Project make its way to the battery-electric vehicle (BEV) manufacturer as a crucial component in the manufacturing of Tesla’s vehicle batteries.

Core Lithium’s supply to Tesla is scheduled to get underway in the second half of 2023, winding up four years later in 2027, or after the equivalent of up to 110,000 dry metric tonnes of lithium=concentrate has been delivered.

Core Lithium is pleased to announce that it has entered into a binding Term Sheet with Tesla for the supply of up to 110,000 tonnes of Li2O spodumene concentrate from the Finniss Lithium Project over a term of 4 years.

Read more: https://t.co/YQ83k3LhIQ pic.twitter.com/pA1gkUyqTw
— Core Lithium (@CoreLithium) March 1, 2022

In addition to the supply deal, Tesla has confirmed that it will support further expansion of Core Lithium’s Finniss Project, located near Darwin, Australia. Core Lithium owns 100% of the project, which hosts JORC 2012 compliant mineral resources of 15 million tonnes (Mt) at 1.3% lithium oxide (Li20), and Tesla’s input into the project will focus on development of lithium chemical-processing capacity.

‘Core Lithium are thrilled to have reached this agreement with Tesla and look forward to further growing this relationship in the years to come,’ confirmed Core Lithium managing director Stephen Biggins. ‘Tesla is a world-leader in electric vehicles (EVs) and its investment in offtake and interest in our expansion plans for downstream processing are very encouraging.’

Another Australian-related lithium producer branches out

Last year, Core Lithium was awarded Major Project Status for the Finniss Project. The approved status equates to extra help from the Major Projects Facilitation Agency, including a single-entry point for Australian government approvals, project support and coordination with state and territory approvals.

Commenting on the approval of Major Project Status for the company, Federal minister for Resources, Water and Northern Australia, Keith Pitt MP stated: ‘This project will be able to supply markets in Asia and Europe with critical minerals, and will have the potential to increase downstream processing, increasing supply chain diversification. This is exactly the type of project that our government wants to see, as we build on our resource-rich history for the decades ahead.’

In July 2021 Core Lithium strengthened its ties with European EV production by becoming a member of the European Battery Alliance, and they are not the only Australian-affiliated concern providing lithium resources for the boom in EV production across the globe.

German-Australian lithium developer Vulcan Energy Resources has signed multiple agreements with carmakers and automotive-related concerns over the last 12 months. Since late 2021, Vulcan has inked lithium supply deals with major carmakers such as Renault, Sellantis, and Volkswagen Group.

Earlier this year, Vulcan linked up with chemical producer Nobian, signing an agreement to assess the feasibility of producing lithium-hydroxide from lithium-chloride in Germany, as the European Union (EU) and governments across the world are looking to find ways to enhance and improve the lithium supply chain. This action is necessary, as the demand for EVs increases in many markets and therefore carmakers are reliant on sustainably-sourced minerals for battery production on a larger scale.

Hydrogen refuelling now possible in 33 countries

A record number of hydrogen refuelling stations opened around the world in 2021 so that there are now 33 countries where hydrogen refuelling is possible.

In total, 142 locations went into operation worldwide, with 37 opened in Europe, 89 in Asia and 13 in the US, according to the 14th annual assessment of H2stations.org, an information service of Ludwig-Bölkow-Systemtechnik (LBST).

A total of 685 hydrogen stations are operational globally, with plans for an additional 252 in the coming months. Hungary and Slovenia were newly added to the list of countries offering hydrogen-refuelling facilities. Of particular note are locations in Spain and New Zealand, which will see several stations opened for the first time.

Hydrogen propulsion technology is further behind on its development path than battery-electric powertrains. This is due in part to the need for carmakers to create zero-emission technology urgently to meet strict emissions targets. The collapse of the diesel market left many manufacturers facing large fines in 2021, as drivers switched to the more CO₂-polluting petrol variants.

Asia leads the way

Europe had 228 hydrogen stations at the end of 2021, 101 of which are located in Germany. France is the second-largest market with 41 operating stations, followed by the UK with 19, Switzerland with 12, and the Netherlands with 11 stations.

However, Asia still leads the way when it comes to hydrogen refuelling. As most of the carmakers promoting the technology come from the continent, including Toyota and Hyundai, this trend makes sense. By the end of last year, there were 363 stations in the region, with 159 of these in Japan, Toyota’s domestic market, and 95 in Korea, the home of Hyundai. There were also 105 stations located in China. However, unlike most other countries, these are used exclusively for refuelling of trucks and buses and not passenger vehicles.

Korea established the most new stations in 2021, with 36 new locations coming online. The country is increasingly expanding its infrastructure for hydrogen fuel-cell vehicles (FCEVs) to help aid the reduction of air pollution caused by transportation.

Hydrogen growth in LCV market

Last year saw a shift in awareness of hydrogen, especially in the logistics market. Many believe that commercial and heavy-goods vehicles offer the best fit for the technology, at least in the short term. These vehicles often complete long distances every day, and need shorter ‘fuelling’ stops to allow for maximum efficiency.

France’s top manufacturing groups, Stellantis and Renault Group, announced the launch of new hydrogen light-commercial vehicles (LCVs). As part of its new Hyvia brand, Renault Group will also provide hydrogen-refuelling technology to station providers across Europe. This could help to see a larger uptake of locations in 2022.

Hydrogen infrastructure is still in its infancy. As more vehicles turn to the technology, so the number of refuelling stations will grow, as was the case for electrically-chargeable vehicles (EVs). The market will also grow as awareness of hydrogen as an alternative to battery-electric increases, along with its viability as a ‘green’ fuel.

This content is brought to you by Autovista24.

JLR finds new European financial services partner in banking giant BNP Paribas

Jaguar Land Rover (JLR) and BNP Paribas have teamed up to provide financial services to the carmaker’s retailers and customers in nine key European markets. The companies want to jointly broaden automotive financing services by early 2023. From next year, retail partners and JLR customers will be offered a range of financing services, covering stock financing, classic loans, lease-to-purchase, long-term lease, and insurance products.

JLR said it had chosen strategic markets in Europe to provide these services covering ‘all aspects of mobility.’ The manufacturer is initially putting its focus on some of the region’s largest automotive markets – this includes Germany, France, Spain, Italy, Belgium, Luxemburg, Netherlands, Austria, and Portugal.

Competitive financing

For years, the premium carmaker has worked with FCA Bank – a joint venture between FCA and Crédit Agricole. JLR and FCA Bank renewed their contract in 2018, which covers the funding of JLR vehicles for the franchise dealer networks in eight markets, as well as a range of point-of-sale financing, leasing and insurance services for customers.

But JLR is now switching its financial services provider, with BNP Paribas stepping into FCA Bank’s shoes. BNP Paribas is known for working with carmakers in Europe. In December last year, it was reported that the French bank was in exclusive talks with Stellantis, as well as Crédit Agricole and Santander, over the reorganisation of Stellantis’ leasing and financing operations in Europe. Stellantis now plans to sell its 50% stake in FCA Bank to Crédit Agricole Consumer Finance, which owns the other half of the business.

‘We are proud to be joining forces with BNP Paribas to create the conditions for further growth and to write another chapter in the company’s history,’ said Francois Dossa, executive director, strategy and sustainability at JLR. ‘This partnership enables us to offer competitive mobility financing solutions across key European markets to create unique and customer-centric experiences as we continue to accelerate our “Reimagine” corporate strategy.’

JLR added the collaboration will build on BNP Paribas Personal Finance for financing, Arval for leasing and fleet management, and BNP Paribas Cardif for insurance. The goal is to offer integrated services covering major mobility financing needs.

Overhauling strategies

‘We are delighted to begin a strategic partnership with an iconic player in the automotive sector, placing sustainability at the heart of the business thanks to an ambitious strategy for the electrification of its vehicles,’ said Thierry Laborde, chief operating officer of BNP Paribas.

‘Our complementary areas of expertise are a key asset for making this partnership a success. BNP Paribas is fully committed to bringing all our capabilities as an integrated group, to bear in support of JLR’s distributors and customers across these nine strategic markets,’ he added.

Meanwhile, JLR is focused on overhauling its own corporate strategy. The company recently scored a £625 million (€749 million) loan to support the research, development, and export of battery-electric vehicles (BEVs). The luxury brand wants to go all-electric from 2025, planning to launch several BEVs in the coming years. The Tata-owned company is actively seeking more collaborations that it says would allow it to explore synergies, especially in the field of clean energy, connected services, data and software development.

Non-automotive companies move into the car sector with new technologies

The automotive industry is undergoing a period of rapid transformation. Connectivity, digitisation, and electrification are opening doors to tech giants and other non-automotive players, seeking to revolutionise the industry. Autovista24 journalist Rebeka Shaid considers some of the companies competing for entry.

When Asian smartphone-maker Xiaomi announced it would set up a wholly-owned subsidiary to wade into the booming electrically-chargeable vehicle (EV) market, the news did not really come as a surprise. As China’s version of Apple – which is also rumoured to be working on bringing its own car to the market – Xiaomi joins a wide variety of non-automotive companies tapping into the car industry.

From tech giants and oil majors to energy and payment providers – an eclectic mix of businesses are showing increasing interest in the automotive sector. Sony Group just announced plans to launch a company this spring to explore the commercial roll-out of EVs. Meanwhile, BP is betting on infrastructure, eager to become a leading charging-service provider. And Rival Shell recently struck up a partnership with Chinese car brand Nio to operate battery-charging and swapping facilities in Asia and Europe.

Tech giants drive connectivity

There is a long list of non-automotive companies revolutionising the car industry, especially in the name of connectivity. Since many carmakers have struggled to produce their own connected products, big tech companies have had an easy time taking the helm when it comes to steering the digital future of the market.

This is particularly true for smart technology provided by the likes of Apple and Google that major carmakers have integrated into their vehicles. A fear of missing out might have led Amazon to also push into this lucrative market, with the company making its Alexa Custom Assistant available to manufacturers last year. Fiat Chrysler Automobiles, now part of Stellantis, was the first carmaker to implement this service into its vehicles. Tesla rival Lucid soon followed suit, making Alexa its primary voice assistant.

These types of partnerships are shaping the automotive industry, which is faced with a complex environment dictated by digitisation, electrification, connectivity, autonomous driving, new entrants, and a plethora of novel products and services. It is no wonder then that OEMs are driving collaborative efforts to exploit innovative opportunities for growth and transformation, especially when it comes to connected cars – not least in the field of in-car payments.

The car as a payment device?

To increase connectivity, financial-services provider Visa struck up a partnership with Daimler Mobility, which plans to offer in-car payments from spring 2022 in a unique pilot project. By integrating Visa’s delegated authentication technology, customers will no longer have to enter passwords or rely on their mobile phones for payment authentication. The collaboration allows Mercedes-Benz customers in the UK and Germany to make payments using a fingerprint sensor in the car. Purchases can then be made directly through the vehicle’s infotainment system.

Jürgen Schübel, Visa’s head of merchant solutions and acceptance, central Europe, told Autovista24 that both the automotive sector and payment transactions are becoming more digital, with the partnership allowing Daimler Mobility and Visa to offer the next generation of networked trade in the car. This not only brings more comfort to drivers and passengers but serves as a strong example of how a leading provider of digital payments and an iconic car brand can combine their technologies into intelligent solutions for the mobility sector. The partnership is the first of its kind and creates ample opportunities for in-vehicle e-commerce.

‘We envision a future where consumers can buy all auto-related goods and services through their vehicle. People expect more convenient and seamless payment experiences – not just from their cards and mobile devices, but also through other channels such as their vehicles. Today, when purchasing car services, motorists must register on a website or physically go to a store,’ said Schübel.

‘The goal of Daimler Mobility and Visa is to enable drivers to purchase exactly the same goods and services through their cars, while at the same time expanding their choice and improving the user experience. The solution will initially be introduced for parking and refueling as well as for paying for the goods and services available in the Mercedes Me Store that can be purchased via the vehicle’s head unit,’ he added.

Schübel pointed out that the partnership could set a benchmark, with more carmakers adopting this business model in the future. The novel service will be rolled out in 19 other European countries, including Italy, France, and Portugal. Visa also confirmed plans to Autovista24 to launch it in markets outside Europe, though no time frame has been set for this yet.

The partnership is beneficial for both companies. Mercedes-Benz emphasised to Autovista24 that its Mercedes Pay service is an essential part of Daimler’s mobility and digitisation strategy. ‘Global mobility trends for electric vehicles, car-sharing, autonomous driving and connected cars are increasing the demand for innovative ways of paying for goods and services in the vehicle itself,’ the German carmaker said.

COVID-19 has accelerated the pace of digital transformation, not least in the payments and automotive sectors. Research by Capgemini Invent found that the number of connected cars on the road is set to rise to 352 million by 2023, compared with 119.4 million in 2018. This also means in-car payments are going to take a more central role, with Juniper Research expecting this service to reach a value of around $86 billion (€76 billion) by 2025. Including these types of applications from third-party providers allows manufacturers to position themselves against their tech and digital counterparts, also giving them a certain level of control.

Connecting cars and homes

However, non-automotive companies are not only striving to connect cars but also homes. Power infrastructure has become a key battleground in the era of electrification. Last year, Volkswagen (VW) Group teamed up with ev.energy to launch its first intelligent household-electricity tariff in Germany, Europe’s largest energy market. Meanwhile, Hyundai announced an ‘integrated clean-energy ecosystem’ called Hyundai Home that offers customers access to solar energy and EV charging from their own homes.

Then there is Tesla. Eager to stir up the energy market, the carmaker partnered with the German unit of British retail electricity startup Octopus Energy to launch an electricity tariff in the country. Both companies have experienced rapid growth, with Octopus Energy achieving a double ‘unicorn status’ as the startup was valued at more than $2 billion a little over a year ago.

The energy crunch in Europe has led to power prices hitting records in recent months. In Germany, electricity prices are ranked among the highest globally. As a fast-growing energy supplier, Octopus Energy is eager to provide affordable energy tariffs, promising flexibility and a two-year price guarantee. Typical customers will only pay direct energy and network costs on top of a monthly €3 fee. The partnership with Tesla allows Octopus to supply sustainable power to households with rooftop solar panels and a Tesla-branded Powerwall storage battery.

‘Tesla is considered a pioneer when it comes to future-proof innovations,’ Andrew Mack, CEO of Octopus Energy Germany, told Autovista24. ‘We are firmly convinced that the pairing of our expertise will help stir up the energy market. We believe that there are many opportunities for energy providers to advance innovative approaches in the future. Thanks to electromobility, cooperation with car manufacturers is the most obvious, and there are sure to be more exciting developments in the market.’

Mack added that the overriding goal is to work with Tesla to offer a tariff that is affordable and ‘good for the environment’ in the long term. He also said the company is working on further possibilities to create more value for customers with their Powerwall and solar systems. The rise of electromobility has helped energy companies forge partnerships with both traditional manufacturers and newer entrants like Tesla. After all, it is not only carmakers that are adapting to the transformation brought on by electrification, but also energy suppliers. Could partnerships between OEMs and utilities soon become the norm?

‘We believe that there are many opportunities for energy providers in the future to advance innovative approaches. Due to electromobility, the cooperation with car manufacturers is the most obvious and there will certainly be more exciting developments in the market,’ said Mack. ‘However, we see a high potential for innovation not only in cooperation with car manufacturers, but also with other companies and industrial sectors. With all these opportunities, one challenge is the complexity of the German electricity market and the strict regulations. Unfortunately, some companies, including established giants, still shy away from that.’

Octopus Energy’s collaboration exemplifies an attitude to take on these kinds of challenges, and having a powerful partner like Tesla on board will help the company forge ahead with its goals. It is this type of approach that many non-automotive companies are applying to shake up the car industry, taking advantage of trends in the realm of electromobility and connectivity. Undoubtedly, we will see more collaborations in this field and announcements by non-automotive businesses eager to revamp the automotive sector.

CATL rolls out ‘one minute’ EV battery-swap service in China

Contemporary Amperex Technology Co. Ltd. (CATL), one of China’s fastest-growing companies, has rolled out a battery-swap service in its home market, allowing consumers to change batteries of electrically-chargeable vehicles (EVs) in one minute.

The company announced the news at a launch event, where it presented the new service under the name EVOGO. The modular battery-swap solution is made up of battery blocks, fast battery-swap stations, and an app. It will initially be rolled out in 10 cities across China, which keeps promoting infrastructure-related facilities such as charging and battery-swapping stations.

Battery-swapping is more prevalent in China than elsewhere in the world, with carmaker Nio planning to add an additional 100 battery-swapping stations to its network of 700 in the country by 2025. But the service is gaining traction elsewhere, with the manufacturer recently partnering with Shell to introduce battery-swapping stations in Europe in a pilot project from 2022.

Battery as a shared product

‘We consider the battery as a shared product, instead of a consumer product for personal use,’ said Chen Weifeng, general manager of CATL’s subsidiary Contemporary Amperex Energy Service Technology Ltd. He added that the new product would help EV drivers beat range anxiety while also getting rid of the ‘inconvenience’ to recharge batteries, as well as high purchasing and driving costs.

Its mass-produced battery, designed to look like a bar of chocolate, has especially been developed for EV battery-sharing. It can achieve a weight-energy density of over 160 Wh/kg and a volume energy density of 325 Wh/L, enabling a single block to provide a driving range of 200km.

CATL gives customers the opportunity to rent one to three blocks to meet different range requirements at swap stations. One block is typically sufficient for inner-city commuting, while the battery maker recommends two to three blocks for longer journeys.

The batteries are compatible with many battery-electric vehicles (BEVs) from different OEMs, suiting a range of vehicles, from Class-A00, Class-B, and Class-C passenger cars to logistics vehicles.

Compatibility and competition

‘The battery-swap station highlights high compatibility, need-based battery rental, and complementarity with charging services. With a footprint equivalent to three parking spaces, a standard EVOGO battery-swap station can house up to 48 Choco-SEBs and allows one-minute swapping for a single battery block, ensuring fully-charged batteries for customers at any time without a long wait. Moreover, EVOGO offers a variety of swap stations to suit the climates of different regions,’ CATL said.

The company launched 10 years ago and has quickly become a darling of investors, helping to give China a lead in EV batteries. It supplies batteries to most of the world’s carmakers, including Volkswagen, BMW, and Tesla. The New York Times found it holds one third of the global EV-battery market, with its biggest competitor being LG. Elsewhere, competition is heating up as carmakers keep pushing into the battery business by building their own batteries or investing in a range of companies to diversify the supply chain.

Last year, Geely, the parent company of Volvo Cars, announced plans to set up 5,000 battery-swapping stations globally by 2025. The company showcased the technology behind this service at the 2021 Wuzhen Internet Conference, with the process taking less than a minute. Tesla at one point explored battery swapping, but withdrew its plan to focus on its network of fast chargers instead.

Battery recycling builds momentum in Germany and UK

As the automotive industry strives to go green, electromobility has become synonymous with sustainability. The aim is for environmentally-friendly factories to build electrified models that will eventually run on renewable energy. But what happens when an electrically-chargeable vehicle (EV) comes to the end of its lifecycle? Companies are considering how an EV’s battery can be re-used, recycled and repurposed.

In Germany, RWE brought a new energy-storage facility online which uses lithium-ion batteries from electric Audi models. The pumped-storage power plant on Lake Hengstey in Herdecke employs 60 battery systems and will be able to temporarily store roughly 4.5MWh of electricity. Meanwhile, in the UK, Veolia announced its first battery-recycling facility. The resource-management company predicts it will have the capacity to process 20% of the country’s end-of-life EV batteries by 2024.

Carry-over capacity

Decommissioned batteries from Audi’s e-tron development cars are the focus of RWE’s project. After primary use, the battery-electric vehicles’ (BEVs) power-storage components maintained a residual capacity of more than 80%. Depending on specific applications, these units can go on to have 10 years of service life. All this for a significantly cheaper amount than new cells.

Oliver Hoffmann, member of the board for technical development, explained that while Audi plans to launch more than 20 BEVs by 2025, its carbon-neutral goals stretch beyond the vehicle. This creates a potential for collaboration with companies from the energy industry.

‘This partnership with RWE is intended to demonstrate the possibilities that exist for the resource-friendly use of second-life high-voltage batteries and their intelligent integration into the power grid of the future,’ said Hoffmann. ‘In addition, we are already thinking about the time after this utilisation phase and are stepping up our efforts to ensure that batteries are recycled effectively.’

RWE expects to start marketing the capacity of the storage system early this year. Initially, it will look towards supporting the grid as part of frequency maintenance. Long-term, findings from the project will help the company build and operate larger facilities in the future.

‘Powerful battery storage plays an essential role in the energy revolution. Flexible storage technologies are needed to compensate for short-term fluctuations in renewable energy and to stabilise the grid. Battery-storage systems are ideally suited for this purpose,’ Roger Miesen, CEO of RWE Generation commented.

‘Together with Audi, in Herdecke we are testing how end-of-life high-voltage batteries from electric cars behave as stationary energy-storage devices when connected together. The continued use of such ‘second-life’ storage is a sustainable alternative to brand-new batteries. The experience gained from this project will help us identify the applications in which we can most cost-effectively operate such battery systems.’

UK processing

We are proud to announce that we have launched our first electric vehicle battery recycling plant in the UK!🔋

With Veolia's urban mining processes, we will be extracting all the different precious elements from end-life batteries. Read more https://t.co/3CwMNQ9Iz4 #UrbanMining pic.twitter.com/ReJFqil3M0
— Veolia UK (@VeoliaUK) January 10, 2022

Veolia’s new Minworth facility is the company’s first step towards developing its recycling technology and treatment capacity in the UK. Given that the country is estimated to have 350,000 tonnes of end-of-life EV batteries by 2040, this approach could turn potential waste into a valuable resource.

Initially, the site will discharge and dismantle batteries before the completion of mechanical and chemical separation stages. Veolia also plans to establish a circular economy in the next five years to produce battery precursors in Europe.

‘We will not reach carbon neutrality without increasing our investment and development of new technologies and recycling opportunities,’ said Gavin Graveson, Veolia senior executive vice-president for the northern Europe zone. ‘As the demand for electric vehicles increases, we will need this facility – and more like it in the UK – to ensure we don’t hit a resource crisis in the next decade.’

‘Alongside other projects across the globe, bringing Veolia’s expertise to the UK recognises the size of the national market and appetite to recycle locally and responsibly. Urban mining is essential if we are to protect raw materials and will, in turn, create a new, high-skilled industry,’ he concluded.

ALD buys LeasePlan in €5 billion deal

ALD Automotive, the car-leasing business of French bank Société Générale (SocGen), plans to acquire its Dutch rival LeasePlan for €4.9 billion in cash and shares. The purchase will create Europe’s biggest car-leasing group, dubbed NewALD.

Once established, the new company would manage the biggest fleet of electrically-chargeable vehicles (EVs) in Europe. The businesses expect to close the deal by the end of the year, with SocGen holding a 53% stake in the new entity.

Based in France, NewALD will have a combined fleet of 3.5 million vehicles. ALD manages around 1.7 million cars while LeasePlan has a fleet of 1.8 million in more than 29 countries. Both companies said the acquisition would allow them to build a leading global mobility player as they hope to profit from trends, such as the shift to zero-emission vehicles and changing patterns of ownership.

New chapter

‘Today marks the beginning of a new chapter in our history as a first step towards creating NewALD,’ said ALD CEO Tim Albertsen. ‘By combining the multiple strengths of ALD and LeasePlan, we would transform our industry and value propositions to our enlarged client base. This transaction would create multiple opportunities to the joint management teams and talents of both companies, across geographies, underpin our focus on sustainability with a clear path to zero-emissions mobility.’

One of LeasePlan’s previous majority shareholders was Volkswagen (VW) Group. The German carmaker sold its 50% stake in the business in 2016 as part of cost-cutting measures. Since then, it has been held by a group of investors that includes TDR Capital.

With the planned acquisition, SocGen is betting on the electromobility boom. Amid the shift to EVs, more consumers and companies are expected to opt for flexible arrangements, such as renting and leasing, to try out different vehicles, including electric ones.

NewALD aims to provide increased services to meet future market needs and client expectations. It plans to invest and develop new mobility products to build digital business models. The company wants to focus on sustainable mobility, aiming to support the transition to EVs by creating global partnerships around electromobility.

Synergies

‘The combined business would be instrumental in moving the automotive industry from ownership to subscription models and zero-emission mobility,’ said Tex Gunning, LeasePlan CEO. ‘NewALD would be operating one of the largest fleets of electric vehicles and will continue to set the standard for ESG (Environmental, Social, and Governance) in the mobility industry.’

The deal shows how European banks are branching out activities to cash in on profitable business opportunities. For SocGen, the leasing business is particularly lucrative as the French bank plans to make vehicle leasing a major pillar of its operations alongside retail and investment banking. It added the transaction would generate operational synergies amounting to €380 million of annual profits before tax. SocGen also said it is committed to remaining the long-term majority shareholder of NewALD.

Other banks are also showing growing interest in leasing operations. Last month, Stellantis said it was in exclusive talks with BNP Paribas, Crédit Agricole and Santander over the reorganisation of the carmaker’s leasing and financing operations in Europe. The deal is subject to approval from the relevant authorities.

Renault Zoe scores zero stars in latest Euro NCAP testing

The Renault Zoe has become the third car in history to be awarded a zero-star rating by Euro NCAP, following the latest round of safety testing by the organisation.

Renault Group’s Dacia Spring also scored poorly, achieving just one star out of a possible five. Testing saw other carmakers achieve the industry-leading five-star standard for their latest models.

The Renault Zoe was one of the first mainstream mass-produced battery-electric vehicles (BEVs) launched, having gone on sale in 2013. The carmaker offered an upgraded model in 2017. However, some safety elements were removed and this, coupled with increasing standards for Euro NCAP testing in the intervening years, saw the model achieve the unwanted stain on its reputation.

Zero-star

Only Fiat has ever achieved a zero-star rating for a vehicle, doing so twice with the Punto and Panda in 2017 and 2018, respectively. These models had not been updated in several years as the carmaker failed to invest in them, leading Euro NCAP to retest and ascertain just how safe they were compared to modern standards.

The Renault Zoe saw a facelift launched four years ago. However, according to Euro NCAP, at this time, certain safety equipment was downgraded. Specifically, seat-mounted head and thorax side-protection airbags were removed, and thorax-only units were added.

In the frontal offset crash, the results were rated as ‘poor’, specifically due to weak protection for the chest area of the driver-side dummy. But it was Euro NCAP’s severe side-pole test that revealed the most drastic results, with the driver’s head directly impacting the intruding pole.

Thatcham Research, which undertakes testing for Euro NCAP, highlighted that the red body parts seen on the dummy in the image below show a potential threat of serious injury and threat to life in the event of an accident.

The test replicates real-world impacts involving a vehicle travelling sideways into rigid roadside objects such as trees or poles. According to Thatcham Research, 33% of these impact types are classified as fatal or serious accidents. As the forces on the car are so localised, the pole can end up deep inside the passenger compartment.

‘It is a serious concern to see results like this in 2021, especially from a carmaker which has previously performed well in Euro NCAP testing,’ said Matthew Avery, Thatcham Research’s chief research strategy officer and Euro NCAP board member. ‘Renault was the first to achieve the full five-star rating in 2001, in part because it was also the first to include a combined head and thorax airbag in the Laguna 2. Although this was a new and revolutionary safety measure at the time, today this airbag is available on most modern cars.

‘Unfortunately, a conscious decision has been made to remove the head protection from this vital passive-safety feature, by the brand that pioneered the use of it. As a result, the safety of occupants within the vehicle has been severely impacted.’

Safety systems

The Renault Zoe also lacks active-safety technology commonly fitted as standard in most new vehicles, such as lane-departure warnings and standard-fit autonomous emergency braking (AEB). This led to a 14% score in the Safety Assist category, 61% lower than the average (75%) achieved by carmakers in the same category this year.

The Dacia Spring fared slightly better with a one-star rating. In its review, Euro NCAP stated: ‘The Spring’s performance in crash tests is downright problematic, with a high risk of life-threatening injuries for the driver’s chest and rear passenger’s head in frontal crash tests and marginal chest protection in a side impact. The mediocre crash performance and poor crash-avoidance technology result in a one-star rating.’

Unlike the Fiat Punto and Panda, the Zoe is unlikely to be pulled from sale due to the zero-star rating. Indeed, Fiat stopped sales of the Punto prior to the results being made public. The Zoe is an important car for Renault, as its leading BEV model and one which is synonymous with electric technology and pioneering spirit at the carmaker.

The Spring, meanwhile, is poised to lead a low-cost BEV attack on the automotive market for Renault Group. It is heavily based on the Chinese-made Renault City K-ZE, itself a derivative of the Renault Kwid, sold in India and Brazil for several years.

‘Renault was once synonymous with safety. The Laguna was the first car to get five stars, back in 2001,’ commented Michiel van Ratingen, president of Euro NCAP. ‘But these disappointing results for the ZOE and the Dacia Spring show that safety has now become collateral damage in the group’s transition to electric cars. Not only do these cars fail to offer any appreciable active safety as standard, but their occupant protection is also worse than any vehicle we have seen in many years. It is cynical to offer the consumer an affordable green car if it comes at the price of higher injury risk in the event of an accident.’

Renault response

In response to an Autovista24 request, Renault stated: ‘We take note of the results published by Euro NCAP following specific tests on Zoe E-Tech Electric according to its new protocol implemented in 2020.

‘First of all, Renault reaffirms that Zoe E-Tech Electric is a safe vehicle, which complies with all regulatory safety standards. These standards are constantly evolving and are becoming more stringent in all domains, especially in safety. Renault therefore continually improves its offer in order to comply with the regulations applicable where its vehicles are sold. Zoe was launched in 2013 and received five stars with the Euro NCAP protocol at that time. The Euro NCAP protocol has, since 2013, undergone five changes. With the same equipment, a model can lose up to two stars in each protocol change.

‘The evolution of the current Zoe was decided in 2017, adapting the passive safety equipment to real accidentology and updating the car with state-of-the-art ADAS equipment such as advanced emergency braking with pedestrian and cyclist detection, lane-departure alert and lane-keeping assist, using a radar and a camera.’

Subtle deterioration in EU new-car markets in November

Autovista24 senior data journalist Neil King discusses how a new wave of COVID-19 cases, along with the appearance of the new Omicron variant, compounded ongoing supply issues and curtailed new-car registrations in key EU markets in November.

New-car registrations in France, Italy, and Spain declined by about 30% in November, compared to 2019. This initially suggests a modest improvement when reviewed against October but, adjusted for working days, the downturns were slightly more severe. The shortage of semiconductors continues to disconnect orders from registrations, but the resurgence of COVID-19 cases and concerns surrounding the new Omicron variant are impacting underlying demand. Accordingly, Autovista24 has revised its forecast for all three markets further downwards.

As registrations across Europe endured troughs because of COVID-19 lockdowns and peaks as pent-up demand was released, year-on-year comparisons with 2020 are incredibly volatile. Therefore, this article focuses on the latest developments compared to 2019, which better represent the true performance of new-car markets.

France 25% down on November average

According to data released by Plateforme Automobile (PFA), the French automotive-industry body, 121,995 new cars were registered in the country in November. This is 25% lower than the average of 163,000 new cars registered in the month between 2010 and 2019. Compared to two years ago, the market contracted by 29.4%, seemingly healthier than the 37.3% decline in October. However, there was an additional working day in November, and two fewer in October, than in 2019. On an adjusted basis, Autovista24 calculates that the market fell by 32.9% last month, compared to the adjusted 31.3% contraction in October.

In addition to rising COVID-19 cases, concerns about the Omicron variant, and the semiconductor shortages, the reduction in French incentives for electrically-chargeable vehicles (EVs) since 1 July has also impacted demand. Consequently, cumulative registrations in the first 11 months of the year were 25.1% lower than in the same period in 2019, subtly down on the 24.7% contraction in the first 10 months. The reduction of electrically-chargeable vehicle (EV) incentives has stabilised the market shares of both plug-in hybrids (PHEVs) and battery-electric vehicles (BEVs), at 8.4% and 9.3%, respectively. A further planned reduction of the incentives from 1 January 2022 has been scrapped, with the subsidies remaining in place until the end of June 2022. However, a €1,000 reduction in the incentives from 1 July 2022 onwards is being considered by the French parliament.

Given the latest developments, Autovista24 has downgraded its forecast to 0.6% year-on-year growth in 2021, following the 25.5% contraction in 2020, to 1.66 million units. This is 25% lower than the volume of cars registered in pre-crisis 2019, although the market is forecast to expand by 8% year on year in 2022.

Incentives exhauated in Italy

In Italy, industry association ANFIA has reported that 104,478 new cars were registered last month. Compared to November 2019, the market contracted by 30.8%, following a 35.7% fall in October. However, as in France, there were two fewer working days in October, and one more in November, than two years ago. On an adjusted basis, Autovista24 calculates that the market declined by 34.1%, more than the adjusted 29.6% contraction in October.

The Ecobonus incentives were resurrected on on 27 October but funding for BEVs and PHEVs ran out after a single day, and were exhausted for low-emissions vehicles on 3 November.

‘In addition to the prolongation of the semiconductor crisis, the total absence, in the current text of the 2022 Budget Law, of measures to address the ecological and energy transition of the sector is of great concern, as no funds have been allocated to support demand or supply,’ commented Paolo Scudieri, president of ANFIA.

The new-car market has further retreated from its cumulative 22.1% decline in the first 10 months of 2021 to a 22.8% contraction through to November. As Italy contends with rising cases of COVID-19 and vehicle supply is not expected to improve, Autovista24 has subtly reduced its forecast for 2021 down to 1.47 million units, equating to year-on-year growth of 6.5%. At this level, the market will be 23% smaller than in 2019. The Italian market is currently forecast to grow 8% year on year in 2022, nudging 1.8 million registrations The pace of the recovery depends on the impact of COVID-19, especially the Omicron variant, and whether purchase incentives are reintroduced.

‘It is essential to provide a structural plan at least over three years and with an adequate budget to avoid that Italy, in this delicate phase in which market policies are fundamental, is the only European country not to support consumers purchasing cars with zero or low emissions,’ Scudieri added. ‘We therefore welcome the presentation by various political forces of amendments to the Budget Law, which propose the refinancing of incentives in support of the demand for cars and light-commercial vehicles with low environmental impact.’

Spain ‘a very depressed market’

A total of 66,399 new cars were registered in Spain during November, according to ANFAC, the Spanish vehicle manufacturers’ association. This is the lowest tally for the month since 2014 and equates to a market contraction of 28.7% compared to two years ago. At first glance, this marks an improvement on the 37.2% downturn in October. However, there was an extra working day in November, and three fewer in October, compared to 2019. On an adjusted basis, the downturn was 32.1% last month, deteriorating from the adjusted 27.7% decline in October.

‘The data for November show that the the trend continues to be downward and even more so when we are comparing it with November of last year, which was a bad month. We do not stop being, therefore, a very depressed market,’ said Raúl Morales, communications director of the Spanish association Faconauto.

The reduction of car-registration taxes in the country since 1 July has been a positive influence for demand, but supply shortages have delayed deliveries. Compared to the first 11 months of 2019, cumulative registrations of new cars are down 32.9% as Spain also contends with rising COVID-19 cases and inflationary pressure.

Year-end positivity

There is some positivity, however, as order intake remains healthy despite the delivery delays and registrations are expected to receive a boost in December because of the planned rise in the vehicle-registration tax from 1 January 2022.

‘What does give rise to hope is that buyers have come to grips with the situation and are going to dealerships to make their purchase, even knowing that it will take longer than usual to receive their new vehicle,’ Morales commented.

Nevertheless, given the limited impact of the July registration-tax cut in Spain and the ongoing economic and supply issues, Autovista24 has revised its forecast for 2021 down to 852,000 units, equating to year-on-year growth of just 0.1%, even after the dramatic 32.4% contraction in 2020.

This aligns with the view of Ganvam's communications director, Tania Puche: ‘The market continues in free fall as a result of the pandemic and the microchip crisis. Everything indicates that it will close the year in the environment of 855,000 units.’

Registrations delayed from this year will naturally bolster the market in 2022, but cars will, rather unfairly, be subject to the higher registration taxes.

‘We estimate that an order book of more than 100,000 units has already been generated and will be converted into registrations next year. These 100,000 clients are going to be harmed by the increase in the registration tax on 1 January, so we insist on the need to extend it, also as a tool to regularise the market situation and move towards a more logical registrations level for our country and to advance the renovation of the parc,’ Morales concluded.

Autovista24 forecasts that the Spanish new-car market will grow by 9% in 2022, to about 930,000 units.

Weakest October since records began for EU new-car market

With the registration of 665,001 units in October, the EU’s new-car market declined by 35.7% compared with the same month in 2019. The European Automobile Manufacturers’ Association (ACEA) explains, ‘this was the weakest result in volume terms for the month of October since records began.’

Pandemic lockdowns dominated 2020, making year-on-year comparisons with 2021 too volatile. So, this article compares current registration figures against 2019, which results in a more accurate picture of how new-car markets are performing.

Turbulent times

The EU’s new-car market continues to experience severe turbulence as registrations dip and climb towards the end of the year. ACEA recorded a 20.7% decline in September, following a painful 34.4% drop in August and a 27.6% stumble in July. But with the publication of October’s figures, any hopes raised by September’s upturn have been dashed as the market tumbles once again.

Over the first 10 months of 2021, the EU saw the registration of 8,191,709 units. This is a fall of 25.1% compared to the same period in 2019 when 10,943,035 new cars hit the road. While recent declines have led to increasingly negative outlooks, the more substantial gains made earlier in the year have helped balance the EU’s cumulative volumes.

Certain countries also contributed to maintaining this balance inside of the EU. In October, Germany, France and Italy were the only three countries to record more than 100,000 registrations. However, compared with figures from the same period in 2019, this equates to drops of 37.2%, 37.3% and 35.8%, respectively. Spain saw a similar decline of 37.2%, with 59,044 new cars registered. Outside of the EU, the UK recorded 106,265 units moved, resulting in a comparative decline of 25.8%.

Ireland saw a promising increase of 23% against October 2019, with 2,179 registrations. Incentives for plug-in hybrid electric vehicles (PHEVs) will be ending there from the beginning of next year, although €100 million has been pledged to support its electromobility incentives for 2022. Romania’s 9.8% decline was also notably more marginal than elsewhere in the EU, with 9,608 units recorded. Meanwhile, Lithuania reported the steepest drop last month, down 62% on October 2019, with 1,548 units registered.

Ongoing issues

COVID-19 infection rates are continuing to surge across the EU, with countries like Ireland, Slovakia and the Czech Republic facing the re-introduction of restrictions. The pandemic’s hold over the trading bloc is evident when consulting the European Centre for Disease Prevention and Control’s suggested travel measure map.

Updated 🚦 maps are online!
These maps aim to support the @EUCouncil recommendation on travel measures in the EU during #COVID19 pandemic.

Color-blind friendly map in the next tweet.https://t.co/CcBVx6B0o5

*ECDC portal is having issues ATM; we will update the map page ASAP. pic.twitter.com/Qml5SNEmT6
— ECDC (@ECDC_EU) November 18, 2021

Consumer confidence keeps taking knocks as case numbers climb. The threat of returning restrictions, higher-energy costs, increasing interest rates and the fast-approaching festive season may lead people to tighten the purse strings. This would mean lighter showroom footfall and fewer online checkouts, resulting in fewer registrations.

As another knock-on effect of the pandemic, the semiconductor supply shortage is also hampering the new-car market. With the ‘just-in-time’ manufacturing network running dry, production is getting put on pause, and delivery times are skyrocketing. Accordingly, ACEA’s director-general Eric-Mark Huitema recently sent up a distress flare.

#Microchips: "It has become crystal clear that we urgently need to minimise Europe’s dependency on overseas markets for these vital components," explains @ACEA_DG.

DISCOVER: https://t.co/KvrO56kfi7 pic.twitter.com/DUKRw7hpuI
— ACEA (@ACEA_auto) November 16, 2021

He stressed the need to increase the EU’s own semiconductor manufacturing capabilities, curbing its dependence on international supply lines. Given the digitisation and electrification of the industry, this component is more important than ever. ‘Think, for example, of electrified powertrains, systems to reduce emissions, active safety features, driver-assistance systems, automated and autonomous-driving functions, connectivity services and even something like digital radio,’ Huitema said.

EV registrations in Europe continue to surge in third quarter

Official figures show that the transition to electrically-chargeable vehicles (EVs) is picking up speed as consumers in the European Union continue to opt for more environmentally-friendly cars.

With governments across the bloc having to meet strict CO₂ emissions targets, carmakers and drivers have benefitted from incentives and subsidies for electric cars. While EV registrations surged in the third quarter of the year, fossil-fuel cars saw a clear slump.

The European Automobile Manufacturers’ Association (ACEA) found that the market share for EVs continued to surge in the three-month period. In the quarter, battery-electric vehicles (BEVs) and plug-in hybrids (PHEVs) accounted for 9.8% and 9.1%, respectively. This means that across the EU, EVs made up almost 19% of all new-car registrations.

The increase could be seen in Europe’s major automotive markets as Germany, France, Italy and Spain all reported rising demand for BEVs. Across the EU, registrations of BEVs soared nearly 57% year-on-year to more than 212,000 units in the third quarter. ACEA said this was ‘despite the overall decline in registrations of new cars over the three-month period, with growth being boosted by BEV incentives in various markets.’

PHEV models also saw a rise in registrations, jumping almost 43% to more than 197,000 units. Demand was particularly strong in Italy and Spain.

Picking up pace

Carmakers in Europe have stepped up the pace to manufacture more EV battery plants to meet the rising demand for electric cars. With the European Commission planning an effective ban on internal-combustion engine (ICE) vehicles from 2035, OEMs need to adapt quickly to the fast-moving transition to EVs.

A recent flurry of announcements makes clear that manufacturers are keen to build more factories and grow their electrification efforts. For example, Ford plans to invest £230 million (€272 million) in its British Halewood site, where it intends to build electric power units for the brand’s future BEVs.

While ICE vehicles will not disappear from the roads in 2035, they are becoming less attractive to consumers. ‘Conventional petrol and diesel cars continued to lose ground, almost completely absorbing the impact of the overall decline in car registrations of the last three months,’ ACEA said.

From July to September, registrations of petrol cars – which remain the biggest sellers and accounted for almost 40% of the new-car market – shrank by 35% to roughly 855,000 units. Overall, their share dropped from almost 48% in the third quarter of 2020 to below 40% this year.

Diesel cars fared worse. Registrations of new diesel cars more than halved across the EU, falling from nearly 770,000 units last year to around 380,000 in the third quarter of 2021. Diesels accounted for less than 18% of the market – less than hybrid electric vehicles (HEVs), which captured more than a 20% share.

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