Pub. 9 2021-2022 Issue 2

23 Fall 2021 of U.S. adults own an electric or hybrid vehicle, and 39% of survey respondents said they would consider buying an EV the next time they look for a new vehicle. 4. Shared mobility: Car ownership is convenient but expensive. New alternatives hope to offer equal or almost equal convenience without the stress and expense. However, shared mobility is still in the dream category since less than 1% of all miles traveled globally resulted from e-hailing trips. During a company video, Asutoth Padhi said the U.S. has had two inf lection points: the shift from horses to cars and the current shift to electrification. However, since electrification probably won’t be profitable for another 3-5 years, industry participants reasonably want to know who will fund the necessary losses between now and then. It isn’t clear what the answer is to that question, but answers may come through collaboration and changes in regulations and technology. The McKinsey Center for Future Mobility wrote a 79-page publication about the upcoming changes. The report doesn’t include a publication date, but it does have information from the Aug. 31, 2019, IHS Markit Alternative Propulsion Forecast. Scan the QR code at the end of this article for the full report. The remainder of this article contains highlights from the report. Gasoline and diesel engines have dominated the industry for more than 100 years, but government mandates have pushed the industry toward more efficient and environmentally friendly transportation. McKinsey’s experts worked to provide information about the following questions: • What power train changes are being made? The report focuses on why, to what extent, where, and when. • What are the most important changes relative to systems and main components? • How will changes affect current powertrain value chains? • How can suppliers respond successfully? The report divides the component market into powertrain type, region and vehicle segment between 2018 and 2025. The report identifies strengths and weaknesses and assesses development and adoption trajectories for new powertrain technologies. It then offers a component by component analysis in four ICE component categories, three high- voltage categories, electrification categories and one fuel cell category. The report offers the following conclusions: • Buyer preferences and stronger CO2 regulations have created a tipping point for electrification. Battery costs are going down, and the U.S. is likely to increase the pace of building the necessary infrastructure for more charging stations. As a result, major markets will start distributing more EVs between now and 2025. • The rate of adoption between now and 2030 is going to be regional. Adoption will be determined by buyer preferences, infrastructure, regulation, technology and total cost of ownership. These forces, and the vehicle choices people have, are not the same throughout the country, and adoption will be affected accordingly. • Powertrains are changing dramatically. While the need for some ICE components will stagnate or decline, the need for electrification components will cause pockets of growth. You need to understand the changes to know how to adapt to the market. The report offers a four-part general strategy that anyone in the auto industry can use: • Nobody knows exactly how the transition is going to take place. However, you can still analyze the situation for your specific region and identify trigger points that will change what happens in the market. Once you know what is happening or likely to happen in your region, communicate what you see within your community and organization. Continue to track trigger points such as evolving customer preferences, incentives and regulations so you can promptly make changes when the time comes. • Keep an eye on global changes while managing performance focus areas that are specific to your business. You should know where you are Gasoline and diesel engines have dominated the industry for more than 100 years, but government mandates have pushed the industry toward more efficient and environmentally friendly transportation.  GOODBYE GAS — continued on page 24