The (Electric) Revolution is BeingTelevised
by Ken Allen, CEO, DHL Express
May 9 marked the first time that the inaugural FIA Formula E Championship brought its electric racing to Europe. Ten teams, including Richard Branson's Virgin Racing, Leonardo DiCaprio's Venturi, Andretti FE and Audi Sport ABT took to Monaco's iconic street circuit. The championship, with six different winners from seven races so far, has already shown that it can deliver thrills and spills for motor racing fans. Formula E CEO Alejandro Agag has also promised that it will help to spark a revolution in electric cars.
Now here are a couple of questions to get you thinking. What do you think the likelihood is that this revolution will take hold? And what do you think the chances are that, at some point, a substantial share of the vehicles on any individual country's roads will be electric? Well, you may be surprised to hear that the latter has already happened. What's more, it was over a hundred years ago. In 1900, electric vehicles accounted for around one third of all vehicles on the roads in the United States. Public interest in electric vehicles at that time was high, particularly for urban driving.
But it was a different revolution - that of the internal combustion engine - which took hold not long after. The commercial genius of Henry Ford and his reliable, highly affordable Model T helped petrol vehicles to take the initiative and triggered a sharp uptake in private car purchases in the US and around the world, effectively laying the foundations of the modern automotive industry. This essentially short-circuited the development of electric motor technology within the automotive industry.
In recent years, however, interest in electric vehicles has returned, helped by both increased awareness of environmental issues and major improvements in electric technologies that have helped increase performance and bring down costs. Most major vehicle manufacturers are exploring electric or hybrid options, at least as part of their product range, and a number of high profile companies such as Tesla Ventures are making a wholehearted effort to mount an electric challenge to petrol and diesel. So are we nearing another major turning point in the history of the automotive industry? Can Formula E and the other bold entrepreneurs that are investing in electric vehicle technology inspire a new revolution in transportation?
Despite all the focus on private cars and individual consumers, the logistics industry is arguably the place where the prospects for electric vehicles are thrown into sharpest relief. This is where the economics of the technologies are put to their toughest test, as buyers of vehicles - usually transport companies - look to find the optimal trade-off between operating performance (including various factors such as reliability, speed and load) and total cost (taking into account both the purchase price and the running and maintenance costs over a vehicle's life-time). The power of branding for buyers of commercial vehicles plays a lesser role (although one manufacturer, and their muscular celebrity ambassador from Brussels, may disagree) and design is only important if it adds to a vehicle's functionality.
Deutsche Post DHL Group, as the world's biggest transport company, has committed to improve its carbon efficiency, with the company's vehicle fleet an important factor. Electric is highly likely to play a big role in that effort, although our positive experience so far has also highlighted some of the major challenges that still hold it back. Range remains a challenge, with electric vehicles still contrasting unfavorably with conventional fuel types for operations over long distances or intense daily delivery schedules. This could be addressed through improvements in charging infrastructure or better battery capacity. In both of these areas, we hope that Formula E will inspire technological change and development. Improvements that the teams will inevitably make to the car batteries will feed into the broader market. And partners of Formula E are working on innovative charging technologies that could significantly broaden the appeal of electric vehicles.
Purchase prices are coming down, but the overall costs can still be higher for many types of transport operations. One reason for this could be that many manufacturers are simply adapting their petrol or diesel vehicles to accommodate an electric battery, as opposed to designing vehicles to perform optimally on an electric platform. Despite the challenges, we still share Formula E's enthusiasm about electric technology. We will increase our electric fleet by at least 500 vehicles in 2015, and we acquired a company last year that produces an electric vehicle (the StreetScooter) specifically to meet our delivery requirements in cities.
Formula E is not just showcasing the capabilities of the latest generation of high performance electric cars. It is also building on its mass market appeal and its commercial partnerships to support other platforms and projects to promote electric technology. The FE School Series, with the support of UK-based charity Greenpower, invites schools at race locations to build and race with their own electric race car, promoting sustainable engineering and technology among future generations. The DHL Blue Sky Transport Design Award has invited aspiring designers to propose a transport solution based on electric technology that will help to create a more sustainable world. A jury including leading design, creative and business figures and representatives of Formula E and Andretti FE will select a winner at the DHL Formula E Berlin ePrix on May 23, and the winning prototype will be presented at the final Formula E race of the season in London in June.
Whether a real revolution is underway that will pose a serious threat to conventional fuel technologies is still an open question. And we are still a long way from the days when 30% of vehicles were electric. However, anyone who has watched a Formula E race to date will be under no doubt about this: the race to the future is well and truly on, and that future is going to be more electric than ever before.