Will 2017 be remembered as the year that electric vehicles (EVs) made the move to become mass producible?
It is a thought-provoking question for the industry, and all the more reason for McKinsey, in partnership with A2Mac1, a provider of automotive benchmarking services, to deepen our work in the eld. Last year, roughly 1.3 million EVs were sold globally.
While this made up only about 1 percent of total passenger-vehicle sales, it was a 57% increase over sales in 2016, and there is little reason to believe the trend will slow.
Established Original Equipment Manufacturers (OEMs) have announced the launch of more than 100 new battery electric vehicle (BEV) models by 2024, further accelerating automotive and mobility trends and potentially growing the share of EVs among total passenger-vehicle sales to 30 to 35% in major markets like China, Europe, and the U.S. (between 20 and 25% of the global market) by 2030.
Moving away from previous so-called niche models such as high-performance sports or mid-range city cars, there will also be a sizable share of mid-size and volume-segment vehicles among the many new BEV models.
A prominent example is Tesla’s recently launched new Model 3, which boasted more than 450,000 preorders.
What will surely help EVs grow in market share is the fact that OEMs have reached driving ranges with their latest models that allow them to focus on reducing price points by increasing design efficiency or reducing manufacturing costs in order to make them more affordable for a wider range of customer segments.
We found that once the average range of our set of benchmarked EVs had surpassed 300 kilometers (or 185 miles), OEMs were able to concentrate on entering lower-price segments while keeping up the range. is indicates that the long-awaited EV volume segment—“mid-size EVs for the masses”—may be on the verge of becoming a reality.
Keep pushing boundaries
Our benchmarking reveals a continued trend toward EV powertrain integration with many elements of power electronics moving closer together and being integrated into fewer modules.
Yet as players keep searching for additional de- sign effciency, one widely accepted EV power- train design has yet to emerge—either in its overall architecture or the design of individual components.
A good indicator of the increased level of integration is the design of the electric cables connecting the main EV powertrain components (such as battery, e-motor, power electronics, and thermal-management modules). When looking at the weight and total number of parts for these cables across OEMs and their EV models, we observed a decrease in both cable weight and the number of parts in the OEMs’ latest models compared with earlier vehicles, which reflects the higher integration of more recent EV powertrain systems.
In addition to the physical integration of main EV powertrain components, we also observed a move toward more simple and efficient thermal-management solutions across said components.
However, while some OEMs are on a consolidation charge here too, others still rely on multiple systems, and we do not see a clear convergence of designs yet.
Beyond the fact that the technology is still maturing, the EV powertrain design variety may also be aided by its intrinsically higher level of flexibility as the components are generally smaller and the ability to maneuver in terms of available space in the underbody and front and rear compartments are higher than for Internal Combustion Engine (ICE) powertrains.
To give just one example of different EV powertrain architectures, the Opel Ampera-e seems to leverage an ICE-like positioning of its powertrain electronics, including ICE-typical body and axle components, whereas the Tesla Model 3 integrated most components on the rear of its battery pack and the rear axle more directly.
It is worth pointing out that such freedom in the positioning of components also gives more flexibility to overall features offered, for example, choosing to have room for a bigger trunk space or to o er superior driving performance through a lower center of gravity.
In their ongoing pursuit of mass marketability, EV players therefore might identify further opportunities in high-level integration of their EV powertrain systems. Doing so could help them capture potential benefits, such as reduced complexity in development, lower material and assembly costs, and weight and energy-efficiency improvements.
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