I believe the global credit crunch, following as it did the spike in oil prices, has cruelly exposed the global overcapacity in the car industry and accelerated the radical shift that is taking place in consumer attitudes to cars — and low-carbon cars in particular.
Our job is to embrace this new reality and seek out the opportunities that this very difficult environment presents for the renaissance of the British car industry.
We have seen a hollowing-out of our industry over past decades, as much of the automotive research and development (R&D) and major supply chains of the industry have gone offshore — and we have an industry that does lots of final assembly but not enough of the high-added-value, top-tier original equipment manufacturing.
The switch to low carbon is our opportunity in the UK to use the tremendous expertise we still have in our automotive science and engineering base and team it up with other expertise from clean-tech, defence and motorsport to create the next generation of low-carbon cars that global consumers are desperate to buy.
We need radical new approaches that challenge the orthodoxy of vehicle design, manufacture, performance, maintenance and disposal: the complete lifecycle. We need to ask difficult questions — and find better answers. Because the pace of change and technological innovation to drive performance with low-carbon impact is pushing the industry hard.
If we in the UK come up with the answers faster than the competition — and if we implement them with real drive — then we will recapture some of the market share we have lost.
But we must take a strategic view of where the greatest opportunity lies for the UK, and low carbon is already an area of stiff international competition. By contrast, ultra-low carbon is a much more promising area, where our potential to compete with the likes of Japan, Germany, France and the US — California, in particular — is that much greater. It is also an area where our science base and inventiveness can be leveraged to a greater extent.
What is more, we’re dealing here with a set of challenges on an entirely different scale.
There is the R&D aspect, of course, necessary to produce plug-in hybrids and all-electric vehicles. The race is on to be early to market with viable cars and then to build brands with global reach. But let us face it, electric cars are not new. Recently I saw a collection of low-carbon vehicles, some of which were more than 100 years old. One, built in 1907, even had in-hub electric motors.
Then there is the critical matter of consumer behaviour.
There is little public appetite for strange-looking and poor-performing cars, whether they are environmentally friendly or not. People want performance and efficiency.
For this to work, we must present consumers with vehicles that contain the ‘wow’ factor — a full range of vehicle classes, not just underpowered city cars, the handling of which leaves many people cold.
We must also offer people elegant systems engineering to shape consumer behaviour. I’m thinking of Oyster cards, which have made travelling around the capital so much easier, and mobile-phone services, where customers don’t pay for expensive handsets and aren’t bothered by the complexities of cross-network costs. In fact, given that advanced batteries will be expensive, rental models and a variety of tariff options are likely to come into play. We will need to allow consumers to dip into the market and try out these vehicles without significant financial commitments.
Our purpose is to figure out how — by developing new collaborations and sharing research — the UK can make the transformative shift to ultra-low-carbon vehicles; a shift by which we can go a long way to displacing liquid fossil fuel, improving our energy security and establishing strength in technologies with vast commercial and social potential.
We are on our way with this. I have been lucky enough to test drive some of the demonstration vehicles. These aren’t poor imitations of petrol cars but examples of high-quality design, engineering and manufacture, including two-seater city cars, SUVs, mini-vans and sports cars, offering bucket loads of torque and great chassis dynamics. But let me stress, technology is not the biggest challenge we face. The problem — both fascinating and daunting — is to combine innovation and know-how in a range of areas to produce a radical new customer experience that can fundamentally change how we get from A to B. We’re on our way — we just need to speed it up a bit.
Edited extracts of a speech delivered by science minister Lord Drayson at this month’s Low Carbon Vehicle conference