Things I learned about the car industry at the annual conference of Canada's Automotive Parts Manufacturers' Association: Ignore the reports about price cuts on the slow-selling Nissan Leaf, or the latest "weak" sales of the Chevy Volt or Toyota Prius V.
"The future is electric," says Franz Loogen, president of e-Mobil, a German state agency that promotes research into electric vehicles.
Like Canada's Auto21, Loogen's agency knows because it supervises research worth hundreds of millions of euros annually in Baden-Wuerttemberg, home to Stuttgart and the cradle of the world's auto industry -- Volkswagen, Porche, Mercedes-Benz, Bosch, Mahle, etc.
The German car companies all used to scoff at the idea of hybrid or electric cars. Now all of them are building them or plan to launch them shortly.
The media is full of reports about Tesla, Tesla, Tesla right now, but the low-volume luxury carmaker is just the tip of an enormous iceberg most consumers don't even realize is moving below the surface of the industry. It's all electric.
"Innovation is exploding right now," said Dr. Gary Smyth, the Irishman who is executive director of global R&D for GM. "The industry is in a period of rapid transformation."
It takes 15 to 20 years to turn over the 300 million-plus cars in Canada and the U.S., but the technological changes that will take place in the next turnover will set up the industry for the next 50 years, said J.E. "Ted" Robertson, senior technical adviser to Magna International Inc.
There are now an average of 75 computer chips in most new cars, with 100 million lines of code in them. They add about $1,200 to the cost of a new vehicle. Five years ago, there were only 25 chips per car adding $400 to the cost.
There are already battery-driven, prototype electric vehicles being driven on U.S. test tracks that have nearly three times the "energy density" of the batteries in a Chevy Volt. They could be on the road in five to 10 years, costing much less than today's EV. They'll have "a big impact" on the industry, Smyth said.
"It completely changes the equation" on cost, range, and vehicle packaging, he said. Japan leads the world in electric-propulsion technology. Toyota has already launched three generations of hybrid cars and batteries, and it has more of them in service than anyone else.
The U.S. is second in electric technology, mostly due to General Motors and Ford having such well-mapped out plans to electrify more of their vehicles. German-French companies are slightly behind the U.S.
China, which everybody thought would be in first place by now, remains in fourth place because it has lagged behind in its battery chemistry, which is tilted toward the requirements of cellphones and laptop computers rather than the automotive sector.
After China learns what Japan and the U.S. already know -- and it will, by hook or by crook -- expect to see "enormous output" of cheaper electric car batteries, Loogen predicts.
GM can manufacture lithium-ion batteries and does so in laboratories in Michigan and Shanghai, China. But it doesn't want to manufacture them: they only do so to learn enough "to push the supply base," Smyth said.
General Motors is now on its ninth generation of OnStar, its on-board cellphone/computer/diagnostics/turn-by-turn directions company. And it's going to use it to turn all its cars into Internet hot spots.
"We're going to put a really big pipe into the vehicles," Smyth said. "We're looking at bringing the entire digital life of the customer into the vehicle." Netflix, anyone?
Cadillac is working on an advanced form of cruise control that uses a vehicle's cameras, proximity sensors and lane-departure computers to provide a form of hands-free, semi-autonomous driving. They call it "super cruise."
By 2020, the most likely scenario is one-third of all vehicles sold worldwide will be either plug-in EVs or hybrids, and most of the other two-thirds will have increased electric components, Loogen said. The companies and workers who don't grasp the looming electric future right now will be shut out of large parts of the industry and the available work.
Electric vehicles will be more fun than ever to drive. "We don't talk about the end of fun in driving," Loogen said of the German industry.
Because of the evolution of OnStar and cloud computing, GM is "hiring thousands of IT (computer specialists) people right now," Smyth added. "We're bringing it back in-house."
-- Postmedia News