EkaLore has released analyses and notes concerning the electric vehicle (EV) market development, primarily viewed through our Alien Invader Framework. Tesla, BYD, and others are not simply new entrants to the global vehicle marketplace; They represent the change hitting the entire industry. Their entry is remaking the USA, China, EU/UK, and India vehicle markets.
The changes created by these new "Alien Invaders" are forcing traditional/legacy internal combustion engine (ICE) manufacturers to reconsider fundamental business assumptions. The idea that dealerships sell to consumers, that vehicle fixes can wait until the consumer goes to their dealership for service, or that state and federal regulations will be enforced at your next visit to the mechanic someday is changing. There are now direct-to-customer sales (business model), regulatory rules and recalls can happen in real-time whenever the vehicle is ready, and features that “came with the car” may now become subscription based.
The trends and actions we see today point to potential increases in the regulatory control of vehicle operation. In this and subsequent posts, we review possible major changes affecting all EV and ICE manufacturers' relationships with regulators. The desire for control by regulators (in domestic markets or globally) and implicit demands for control because of supportive subsidies are not new. It appears that the extent of reach may be changing.
The impact of this relationship change for global colossal enterprises with governments, and regulators may be great. They need to be understood by all enterprises. The change – whether interference or benefit and or both – will alter product and service regulations in all markets.
Relationship changes between industry sectors as major components of economies have been underway in smaller parts since the mid-20th Century. Vehicle manufacturers rose to become exemplars of large-scale mass production – for a massive public as customers – as critical to the health of national economies. In many countries, domestic production of automobiles became a central point of national manufacturing health (Germany, Japan), and any declines were cause for governmental alarm (Australia, USA., UK). Safety scandals (USA GM, USA Ford) were followed by widespread cheating on engine pollution controls endangering public health (EU VW, USA VW, USA Chrysler). These events prompted regulators to monitor manufacturers’ vehicles more aggressively.
The critical volume of jobs and the industrial sectors supplying jobs for EV and ICE vehicles are now seen as key in transforming economies to be "green." The critical political importance of the industry and related manufacturing, service, and financing jobs has been combined with the technology wave of change.
The key results of the compelling need for the green transformation of the vehicle and transportation sectors are:
1) Regulators want more control of vehicles – particularly software
2) Governments want to dictate features and controls – in return for industrial and consumer subsidies
3) The transformation of industry sectors is transforming all jobs across the industry supply chain, from mining to services
4) Investment needs are so large that even colossal global enterprises can't be successful or afford it on their own
5) Consumers are demanding daily value from hugely expensive vehicles
We’ll be continuing this thread of posts. Look for our next post at www.ekalore.com/alien-invaders
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