Governments boost global automotive spend for alternative fuel technologiesDOWNLOAD
Close to US$44 billion in economic stimulus funds and other incentives are being directed at the development of alternative fuel and advance technology vehicles according to a new global analysis by professional services firm Deloitte. The automotive industry analysis reveals that economic stimulus packages and other government programs are becoming increasingly prevalent in at least 13 markets worldwide.
According to Deloitte Automotive partner, Damon Cantwell, consumer demand for greener vehicles as well as new regulations will heavily influence the development and marketability of innovations in the automotive industry.
“Our global analysis shows that the United States is leading in terms of economic stimulus and other government incentives with an estimate of US$27.4 billion directed towards alternative fuel technologies such as Electronic Vehicles.”
“In Australia, from a vehicle manufacturer viewpoint, the focus on changing the model mix produced locally will need to continue, as we are predicting alternatively-powered vehicles representing one third of new car sales in developed markets by 2020,” said Mr Cantwell.
“From a component manufacturer perspective, the regional appetite for technology and design services will also present significant opportunities for progressive Australian companies over the medium term.”
In 2009, Deutsche Bank estimated that global sales of electric, hybrid, and other alternative fuel and advance technology vehicles stood at one million and could rise to 1.3 million in 20101. According to J.D. Power and Associates, sales of hybrid-electric vehicles could reach about 1.3 percent of an estimated 67 million light vehicle sales this year2.
“The drive for e-mobility is on the rise and not only affects the automotive industry, but also other related industries such as energy & resources,” said Mr Cantwell.
“Incentives and government support range from tax breaks, cash bonuses and other sales incentives for consumers, to subsidies for research and development (R&D) projects. As a result, consumers who are keen to adopt alternative technology vehicles will further benefit,” said Mr Cantwell.
“Importantly, these findings support the broad direction of the Federal Government’s Green Car Innovation Fund, and the Automotive Australia 2020 Vision work being conducted by the Automotive Co-operative Research Centre,” added Mr Cantwell.
The report also detailed how the future of e-mobility and the approach to technology advances in cars is expected to be divided based on regional geographies.
“Green alternatives, such as electric vehicles will likely find more consumer interest in the developed countries, while flex-fuels, such as ethanol and natural gas will find wider adoption in emerging markets where the local climate or resource base favours these fuels over petroleum. Australia finds itself well positioned in regard to LPG uptake historically, with a required policy environment that is conducive to supporting other alternatives,” concluded Mr Cantwell.
The analysis by Deloitte shows that the global automotive industry is expected to benefit directly from an injection of around US$105 billion in economic stimulus funds, representing a small percentage of the estimated US$4.3 trillion in economic stimulus packages committed by various governments around the world.
For a copy of Driving e-mobility: Economic stimulus and other support spur development of alternative vehicles, please visit Deloitte Manufacturing site.
1.“Electric Cars: Plugged In 2”, Deutsche Bank. November 3, 2009
2.“Electric cars win hype, staying power questioned”. Reuters. April 5, 2010