The European car market is facing a severe crisis: between January and April 2019 about 5,000,000 cars were sold, while in the first four months of 2021, only about 3,000,000 were sold. Due to the forced closures caused by the pandemic, 2020 cannot objectively be considered a reference year. The Italian market has lost less than the total European market, with a decrease of about 17% in the first four months of 2021.
This sharp slowdown in the auto industry, comparing the first four months of 2019 with those of 2021 can be explained, above all, by the uncertainty of customers regarding the right choice of engine and the still incomplete range of electric and electrified cars offered, which are not yet able to fully meet the requests and all the niche demands of a public accustomed to a very wide choice. Fewer and fewer diesel vehicles are being sold, but none of the traditional endothermic engines are doing well, even if the sales of diesel-powered cars suffered the worst losses. The market for CNG and LPG vehicles is now at death’s door, despite the effective, existing refuelling network developed over the last 40 years. This niche is disappearing mainly because of the scarcity of the range of models offered with OEM gas systems installed (i.e. original systems) by car manufacturers, despite the low cost of this type of fuel.
Market potential for electric and electrified vehicles
On the other hand, there is a part of the car market that is growing steadily across Europe: the electric and electrified car market. It has been growing at double or even triple digit rates for the past few months and has certainly been playing a leading role in the recovery phase. According to our analysis, 32.30% of cars sold in Europe today are electric, hybrid or electrified. This is a continental, European trend, but the electric car is very popular even globally, with very few exceptions. This may be due to a delayed reaction, given that battery electric vehicles are the ideal solution for large cities, e.g. for taxi fleets, with vehicles that are comfortable to drive, quiet, economical and with zero gaseous emissions.
Reasons that guide the choice of an electric car and that are still holding back the decarbonisation of today’s auto industry
Many people, potential buyers, still admit that they have never driven an electric car, i.e. they have not personally experienced the driving comfort offered by these cars. An electric car is almost free of noise and vibrations, which especially for small city cars (i.e. market segments A and B) could be the first valid reason for buying an electric car, apart from the indisputable environmental and economic benefits. For example, a fully electric car, such as the Smart EQ Fortwo, can easily be fully recharged overnight in a normal electric socket, and its driving comfort is truly remarkable compared to its competitors with internal combustion engines.
The general public is still unfamiliar with electric cars. This fact is also confirmed by the varied, nonhomogeneous Italian electric car market, which once again shows that there is still plenty of room for the inclusion of European mid-to-high range cars in important market segments (segments D and E), where good quality components must also be developed, above all, in Europe.
Recharging infrastructure
Assuming that the electric vehicle should be charged slowly and economically during stops, especially at night, all electric vehicles can already offer performance and autonomy to meet the needs of the average citizen. One of the most important points for the spread of electric mobility is the public charging infrastructure, which is accessible when the car is parked or during quick and ultra-quick refuelling on the move, the so-called “opportunity charging”. Thanks to the latest generation of charging stations, which have an output of 350 kW, certain electric cars now make it possible to travel in times similar to those of high-class cars with endothermic engines, with stops of 15/20 minutes. These rest stops must always be taken every two hours or so with all cars, for reasons of safety and driver fatigue. In Europe alone, the Ionity provider already has more than 400 recharging points with fast technology, of 350 kW, close to the main motorways.
Conclusions
For every three cars sold today, one is electric (electric or electrified), so this is a market certainty that must be seen as an opportunity for companies in the sector. To these evaluations must also be added the sector of commercial vehicles, trucks, buses, vans, earth-moving and agricultural machinery. Those who want to participate in the supply and sub-supply of components for the automotive sector must start planning the development and innovative technological adaptation right away. The technical solutions offered must increasingly take into account this specific vehicle technology, which already offers considerable production volumes.
The conversion of the automotive industry, both Italian and European, is now an obligation and will also be a great economic opportunity to demonstrate the undisputed ability of Italian companies to work faster and with less capital than their European and Asian competitors.
Consulting companies and research and development laboratories will play a crucial role in making Italian investments more efficient, driven by the need for continuous technological updates, as will companies specialising in the validation and certification of solutions developed in Italian industries, which need to objectively enhance the requests of vehicle manufacturers.
Independent partners in the automotive components industry will be indispensable to increase the quality and reliability and to reduce the development times of the vehicles of the future.