This is a critical time for the global car industry as a result of economic volatility and turmoil that has not been experienced in decades, perhaps since 1929, and which has thrown many of the usual rules of business up in the air.
Everyone is hoping that demand is building and consumers will soon start buying again, but we do not know when that will happen.
The one certainty is that people will continue to drive cars. Cars have no substitute — they cannot be replaced by public transportation because people need and want their autonomy. Buying a car is still a major life event and owning one is an important symbol of freedom, status, and achievement.
But what kind of cars will they be — diesels, flex fuels, hybrids, fuel cells, electric? This question is of growing importance as the world is changing rapidly.
Two trends are bringing this discussion to the forefront. The first is the shift in demographics. Today, the world’s population is 6.7 billion. By 2050, it is expected to reach more than 9 billion. Today, there are 600 million vehicles worldwide. By 2050, statistics show there may be up to 2.5 billion vehicles. Many of those will be sold to the rising middle classes in markets such as China and India where, today, there are fewer than 50 vehicles per 1,000 inhabitants compared with 800 vehicles per 1,000 in the US.
With such rapid population growth in developing markets it is no wonder that consumers and governments are concerned about potential congestion, pollution and scarce resources.
This leads us to the second trend — concern about the environment. Unlike the financial crisis, which will hopefully come to an end in the foreseeable future, concern about the environment will not end soon. Once this financial crisis is over, the factors that drove oil prices up last summer will likely drive them up again, and the focus on fuel emissions will continue.
As carmakers, we answer with a range of technologies — from hybrids to clean diesels to fuel cell vehicles. But a 20 per cent to 30 per cent improvement in emissions is not going to solve the environmental problem. The end game is zero emissions — and the best way to curb emissions is not to produce them at all.
This is why Nissan, partnering with Renault, will begin to mass-market electric cars worldwide in 2012. We will bring a smart, substantial alternative to ordinary vehicles — not just one car, but a line-up of electric cars to meet a variety of customers’ needs, from small cars for cities, to minivans, to 4x4s.
This is just one piece of a larger puzzle. To ensure the adoption of more eco-friendly cars, provide a good alternative for crowded city driving and build an infrastructure that gives consumers sufficient autonomy, we need to think and develop in terms of a big picture for the future of mobility.
The good news, based on conversations we have been having over the past six months, is that our vision is shared. To date, the Renault Nissan Alliance has agreements in Japan, Israel, Denmark, Portugal, France and in Tennessee, US.
These involve infrastructure system planning. For example, in Israel, customers will be able to plug their cars into charging units in any of the 500,000 charging spots located throughout the country. An on-board computer will guide the driver to the nearest charging spot.
Governments are also shaping public policy by designating preferential parking or highway access and approving tax credits that can put this new technology within the reach of car buyers.
As we are working with national and local governments, we are also talking to electric utility companies and other third parties about building networks of electric vehicle charging stations.
Finally, everywhere we go, we are talking about the long-term need to boost funding for renewable energy. With electricity produced by the sun, wind, water or by nuclear power, the zero-emission cycle would be complete.
A prime example of what can be accomplished when public and private sectors work hand in hand is represented by our newest electric vehicle partner, the state of Oregon, where we will launch our first electric vehicle in the US in late 2010.
Governor Ted Kulongoski’s 2009 legislative package proposes to replace the $1,500 (£1,030) tax credit on hybrid vehicles with a $5,000 credit on all-electric cars. The state is streamlining permits and certification to accelerate the installation of charging stations.
Our partners in Oregon are not waiting for a ‘someday’ solution. They are taking short-term actions to benefit the environment today while creating conditions that will benefit the environment for years to come.
This is about reinventing mobility. It is about stretching what we have always known about cars to allow for new ideas and practices. It is about anticipating what future transportation needs will be.
The auto industry has committed to action. Several global carmakers have vehicles in development, and we are moving fast.
With the right infrastructure and the right economic conditions, we can navigate through this uncharted territory to put sustainable mobility within our reach in the near future.
Edited extracts of keynote speech delivered by Carlos Ghosn, chief executive and president of Renault and Nissan, at the LA Auto Show
Carmakers are responding to a growing demand for vehicles and to environmental concerns with zero-emission vehicles, says Carlos Ghosn.