Electric vehicles are one of the key disruptive trends facing the lubricants industry.
A major talking point at this year's F&L Asia conference was the forecast of exponential growth of electric vehicles over the next two decades, with most analysts predicting that one third of the car parc will be electric by 2040.
China is set to drive this growth, prompted by a desire to take the lead in global battery technology as a result of increasing regulation, as well as an apparent aim to dominate the production of Battery Electric Vehicles (BEV) in Asia.
A consumer sentiment study from Deloitte in 2018 shows some interesting regional differences in the concerns and requirements of EV consumers:
- In most major markets, the key concerns are the limited driving range and a general lack of charging infrastructure.
- In the US and Japan, there is the additional concern of price premiums
- Chinese consumers are also particularly worried about the safety of the battery technology.
The key question is whether fully-electric or hybrid vehicles will actually become the dominant model and, if hybrids continue to develop, which hybrid engine will win the long-term fuel economy and performance battle: Full Hybrids (can run fully-electric and charged by the motor) or Plug-in Hybrids (can run either electric or with the internal combustion engine (ICE with the electric motor charged externally)?
In Japan, there is still strong R&D in Hybrid technology given the long history of its development amongst the Japanese OEMs, but all are also heavily investing in all-electric BEVs.
The impact on the lubes sector right now is a significant rise in innovation. In particular, the fully-electric powertrain requires complete re-engineering of coolant technologies, gear oils and greases as they are in contact with electric modules, sensors and circuits and subject to the affects of electrical current and electromagnetic fields.
Lubricants must also be compatible with copper wires, electric modules, special plastics and insulation materials not previously present in ICEs. Given the heat levels emitted by electric engines running at high speed, the importance of high quality fluids and oils to ensure smooth running and longevity of electric vehicles is arguably greater than for the traditional ICE. Huge investment is already being made as the lubes majors scramble to gain leadership.
Elsewhere, UK Power Networks (UKPN) is exploring new ways of managing the additional demand of EVs through smart charging (moving charging from peak times to low demand periods in weekday evenings) rather than building unnecessary infrastructure. Meanwhile concern about the impact on the UK National Grid has led to the launch of an off-grid EV charging system which may allow EVs to charge fully within an hour without drawing energy from the National Grid.
In other EV news:
- Shell has purchased Greenlots, a UA-based EV charging and energy management software company
- Connected Kerb has launched its first series of EV charging points built into the roadside in London
- VW's Electrify America will install Tesla battery storage packs in some EV charging stations
- Indonesia is considering policies to encourage production and purchase of EVs
- Singapore will see the largest public EV charging network with 1,000 points by 2020
- New Indian guidelines will see parking spaces for EV charging facilities for 20% of residential and commercial complexes
- Resilience Energy is aiming to become the "Uber of the electricity industry", allowing its customers to sell excess electricity and battery capacity to the National Grid
Given its importance, we will continue to track developments in the EV sector and ensure each OATS Bulletin has an article dedicated to the topic for the foreseeable future.