Cooperation + Innovation=Happy Marriage?

November 5th, 2008 mhitchings The vehicle has continued to evolve to meet consumer, industry and world needs. Every 30 years, a change is inevitable, said Charles Morgan, director of design with Morgan Motor Co.

At Morgan, it’s about the vehicle and the consumer, pride in the creation and building of each vehicle, which, he noted, takes about 16 hours and is completely built by hand, no robots, no artificial means of compilation.

“I think it’s important to be open about what you do,” Morgan said. “I think it’s important for people to want to visit the factory and know that real people build the cars…new technology is great and we all need it, but there is an element of craftsmanship at Morgan that is important.” That being said, the company recognizes the need to keep up with energy efficiencies and listen to their customers. In an effort to reduce its environmental footprint, Morgan cars are about 30% lighter than those that are mass produced, he noted.

Morgan was one of three members of the production and supply chain innovation session starting this morning’s second day of the Altermobile Europe 2008 conference in Munich.

Phil Barker, chief engineer of hybrid and electric vehicle technologies with Lotus Engineering, discussed four key themes within the topic of production and supply chain innovation — developing new business models, innovation and design as a core business process, collaboration and cooperation, and internationalizing supply and production.

“The basic problem we are looking at is trying to run a country without oil,” said Amit Yudan, Europe Business Development with Better Place. One of the conference themes was to reduce, if not nullify, dependence on oil and conventional fuels and think more out of the box.

“The real market response is volatile,” said Andre Metzner with Roland Berger Strategy during his portion of the presentation, Cooperative Constellations in the New Auto Innovation Game. “No doubt there is a need to cooperate.”

Metzner discussed a variety of “cooperation,” noting most people are familiar with the “marriage” concept, which is planned for the longer time horizon, is formalized and usually has a low flexibility. He also noted a few other important types: club, syndicate, commune, party, forum and expedition.

“These types are not legal/business categories — they can serve more as conceptual reference points for designing or understanding cooperative constellations,” Metzner said in his presentation white paper. “From my experience, cooperative projects need both, a conceptual foundation and cooperative cultural embedding. The culture part should not be underestimated, especially in situations where fierce competitors cooperate or new ground needs to be (jointly) explored.”

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‘It’s Like Pushing a Pea up a Hill’

November 4th, 2008 mhitchings Can the oil and automotive industry continue to live quasi-harmoniously with the direction of the global economy, global warming and fuel costs?

The overall opinion is no, according to many of the speakers this morning during day one of the Altermobile Europe 2008 conference in Munich.

Iain Carson, business writer with The Economist and co-author of Zoom the Global Race to Fuel the Car of the Future, set the scene with the oil and car industries — neither of which, he noted, would be able to exist without the other, but that neither can continue to operate at current levels.

“We are potentially heading for a divorce,” Carson noted of the marriage between the oil and car industries. “We can’t go on the way we have before. Why are we all here today? It’s the two words of the conference — we need to find alternatives for vehicles. We can’t do without cars, we desperately need them. The conclusion we came to is that cars aren’t the problem, it’s the oil,” he said, noting the thoughts of he and his co-author.

Global warming, energy security, safety and the debate of fuel and energy for automotive power were key topics among speakers. Nearly 100 representatives from car and design industries, financiers and investors as well as industry publications gathered to learn from each other how infrastructure and design will lead to automobile technology of the future.

Carson discussed peak oil and the thoughts of some pessimists that oil reserves in areas such as the North Slope are decreasing. On the flip side, he said, there are optimists who say we’re not really running out of oil, there’s plenty to go around. There are other sources to tap, such as tar sands, but Carson said these areas pose challenges because the oil is heavy, it’s tough to get out of the ground and its expensive.

“I think at the end of the day we will end up having more [oil] than we thought,” he said. “I think this concept of peak oil is like counting angels on a pinhead.”

Energy security, he said, is an obsession in America, because “not only is there a worry about scarcity of oil, it is concentrated in difficult and unstable parts of the world.” Carson noted that during the past 20 years, there have been two major wars in which the United States has been involved that revolve around oil.

Noting that about one-quarter of the man-made global emissions come from surface transportation, Carson said about 8% to 9% of that comes from private vehicles.

“We have this problem with global warming, and the only way industry can deal with it is with technology,” he said.

Christopher Borroni-Bird, director of advanced technology vehicle concepts for General Motors, noted that “vehicles of the future need to become a lot more intelligent and a lot more agile” — meaning they need to adapt to the way we live.

During his presentation, Borroni-Bird analyzed various regions and the way vehicle use impacts its residents. “In congested urban areas, 30% to 40% of total gasoline is used by cars looking for parking, and the average search time is about eight minutes,” he said. “Clearly there is much room for improvements to the customer’s parking…
“Cities are beginning to act like nation states driven by rapidly growing congestion, a broad resistance to urban highway construction and public financing of mass transport, and a desire to compete for business by marketing quality of life.”

Global transportation is the third-largest contributor to carbon dioxide emissions and global warming, and the second largest annually is land use, said Professor Julia King, vice chancellor with Aston University in Birmingham, U.K.
“The climate change challenge is to have a reasonable chance of restricting average global increases to close to two degrees and to avoid a significant probability of as much as four degrees. The developed world will need to reduce emissions by 80% by 2050,” King said.

Although King said she doesn’t believe the world is on track to meet these reductions within the given timeframe, she does believe the technology is there and that governments and policy holders can help.

“In the next 10 years, increased vehicle efficiency offers the largest opportunity for reducing CO2 — both through us as consumers, choosing more efficient vehicles and through improved technology,” she wrote in her white paper presentation. “Within 10 years, we could be driving equivalent cars to those we choose today, but emitting 30% less CO2. The technology is available. Moreover, the cost of the technology, likely to be reflected in increased car prices, is offset several times over by the fuel cost.

Traffic congestion in some places is increasing, even though many cars are becoming cleaner, Carson said. “It’s like pushing a pea up a hill…,” he said.

Climate change is not an issue that will easily be solved; it will take some time to get all parties aligned and address the challenges in the most productive manner with the most information available.

“…Climate change is a global problem, and effective solutions and policies must also, ultimately, be global. But we all have an individual role to play, which makes a difference, as citizens in electing governments and supporting legislation, and as consumers in the cars we choose and when and how we use them,” King said. “With strong, early action by governments, industry and individuals, car ownership and use can continue to drive economic growth and enhance quality of life around the world without destroying the planet.”

The world as we know it today is not the world of tomorrow.

“The world is changing, and in response to this there is a clear shift to electric drive. Electric drive could take vehicles out of the energy and environmental debate, but to solve all the personal urban mobility issues it will be necessary to tackle the network of vehicles, and this can only be addressed through connectivity: the goal is zero emissions and zero accidents,” Borroni-Bird said.

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