A road paved with tech

From a technological, economic and political perspective, there’s little doubt that the mainstream electric vehicle future is nearly here — and German carmakers are betting big on it. “The future of the automobile is electric and intelligently connected,” Carsten Bender, Managing Director at Audi Middle East, tells GN Focus.

He points to the brand’s e-tron and e-tron Sportback models, which are already available in the region. Porsche, another Volkswagen subsidiary, already retails three models of its electric Taycan in the UAE, starting from Dh401,000.

Globally, German automakers are spending big on the electric future. Volkswagen, the world’s largest carmaker, has committed to spending €60 billion (about Dh257 billion) on electric vehicles (EVs) and developing 60 per cent of the software in its cars by 2025, and Stuttgart-headquartered Daimler has partnered with chipmaker Nvidia to build in-vehicle computing systems, AI computing infrastructure and, perhaps most interestingly, the ability to provide over-the-air software updates to cars, including Mercedes-Benz’s next-generation fleet.

Over in Munich, BMW has established iVentures, a venture capital fund investing in start-ups involved in areas such as autonomous driving, e-mobility, AI, and digital car and automotive cloud services.

However, two years of global declining auto sales and uncertain economic headwinds pose a challenge to all legacy automakers. “We are experiencing greater trends towards sustainable transport, convenience, personalisation and affordability,” says John Gillespie, Principal Engineer - Transport Planning at consultancy WSP Middle East, who adds that transport options are now addressing convenience without requiring the ownership of a personal car.

“Huge investments are being made in public transport, soft mobility and on-demand transport in the region with the ultimate goal to limit private transport, traffic and personal car usage – while usually being cheaper. Many analysts suggest we have even reached peak car in parts of the western world – the distance travelled per capita has peaked and will now fall in a sustained manner. I expect this trend within the Middle East as well, given the focus and investment in prestigious non-car projects such as Etihad Rail, Hyperloop, Riyadh metro, Makkah metro, pedestrian bridges, soft mobility projects and increased bus services across the region.”

For Gillespie, the move should not be to increase net growth in sales but rather to boost the attractiveness of electrical cars while phasing out their fossil fuel-driven counterparts.

“Our direction is clear,” says Bender, adding, “Sustainable mobility suitable for everyday use.” He points to Audi’s 2025 plan to ensure all its plants are carbon neutral as an initiative that fits this bill. “This aligns with Audi’s plans to have around 30 electric models in its line-up by 2025, and in our region we are very much aligned with this momentum.”

In a bid to boost its pandemic-stricken economy and encourage automakers to sell environmentally-friendly vehicles, the German government announced a multibillion-euro subsidy programme in June. The initiative sees the government subsidising €6,000 on electric vehicles that cost up to €40,000, while buyers of these cars pay 3 per cent lower sales tax. “This is about renewable energies,” German Finance Minister Olaf Scholz told CNN. “This is about all the climate activities which are necessary to get to a [carbon] neutral economy in 2050. We have to start now.”

Artificial intelligence (AI) has been integrated into vehicles at a steady pace over the past few years, adding a number of useful features. These include lane departure warning systems, which alert drivers when they are veering outside their lane; autonomous emergency braking; adaptive cruise control, which automatically keeps a car a set distance from the one in front of it; and adaptive front lighting. Audi’s Human-Centric Lighting project is experimenting with the effects of various lighting shades on passengers’ concentration and memory. Bosch has something similar – an autonomous interior camera system that recognises a driver’s tiredness, warns them and even slows the vehicle down if need be.

A report on artificial intelligence in the automotive industry shared with GN Focus sheds light on various aspects of a key technology for the sector. “It is helping the important business areas of smart factory, driver assistance systems, autonomous driving, customer experience and smart city traffic infrastructure such that companies remain competitive,” says the report published by NetApp, a data management and cloud storage solutions provider that is working with Nvidia to build AI architecture for the automotive sector. “With AI, complex everyday tasks can be solved where conventional algorithms fail. This is also true for the automotive industry, which is struggling to cope with the sustainability debate, the trend towards e-mobility and now the coronavirus crisis.”

According to the report, AI can be a panacea for a number of issues in the automotive industry, though it adds that public acceptance remains a challenge. An online survey commissioned by NetApp earlier this year found that only 16.7 per cent of 1,000 respondents were aware of the benefits of AI in cars. Just 9 per cent said they used any kind of internet service in their car, and 12.2 per cent would consider it important for their next vehicle to support such services.

The report outlines a three-stage AI model for technology. Stage one focuses on collecting and correlating data, allowing manufacturers to trace every part used in a vehicle back to its source, reducing warranty risk of defective parts and even organising more finely targeted recalls. The second stage is about recording and interpreting conditions – which the report refers to as “human-inspired pattern recognition” – particularly temperature, vibrations and humidity. This can aid preventative maintenance by helping consumers avoid major repairs. Finally, stage three sees the margin for algorithm error reduced to the extent that autonomous driving is safe.

In terms of technological advances aiding the electric vehicle cause, Gillespie singles out lithium-ion batteries. “Prices of lithium-ion batteries have fallen 87 per cent over the past decade and are forecast to continue to decline.” Bigger, better-performing batteries are massively important for the electric vehicle category – the first fully electric cars suffered from lower ranges in comparison to their conventional counterparts. “Electricity is also much cheaper than petrol to run a vehicle, therefore running costs will be lower throughout the life cycle of the car. In the UK, the tipping point was reached this year where an electrical car was cheaper to own and run than a petrol car over the car’s life cycle.”

The technological pieces are falling into place for an electric, autonomous and affordable future for cars. Will Germany’s automakers reign supreme over younger upstarts such as Tesla? Time will tell.