Part 1: Washington Auto Show Preview: What to Look For

What should attendees who care about reducing drivers fuel bills, cutting our oil dependency, and revitalizing the auto industry be looking for at next week’s DC auto show?

In this blog, I peak under the hood of the show to highlight the most relevant products and technologies.  After attending both the LA Auto Show (December 2010) and the Detroit Auto Show (January 2011) I have a good sense of what’s hot and what’s hot air.

The good news is there is no shortage of technologies to solve our energy and pollution problems. Automakers are preparing for $4/gallon fuel prices and stronger fuel economy and pollution standards globally.

The auto shows are tangible proof that regulations drive innovation (see my LA Auto Show and Detroit Auto Show debrief blogs). The auto industry typically says “it can’t be done” and a few years later produce it at a cheaper price than they claim. Many of the cars at the auto shows disprove these claims; they are evidence that it can be done.

Update on fuel economy standards. A new proposal is expected by September 30th  and could be as high as 62 mpg. Setting strong and long-term standards will in large part determine whether how fast hybrids, plug-in hybrids and battery electric cars will become available.

As recent joint analysis by the Environmental Protection Agency, Department of Transportation and California Air Resources Board demonstrates, 62 mpg is what’s needed to drive these advanced technology vehicles to market in substantial numbers.

U.S.  $10 billion investments in electric vehicle manufacturing is paying off. No auto show this year would be complete without checking out the green glamour vehicles at the show, the Chevy Volt, Nissan Leaf, the Ford Focus Electric, the Fisker Karma and Tesla Model S. 

All these vehicles and their batteries are being produced or soon will be produce in the US thanks to a total of $8.3 billion in government loans, including $5.9 billion government loans to Ford and $1.4 billion loan to Nissan. (GM didn’t get direct loans for Volt but of course got $52 billion in government aid to stave off bankruptcy). According to government estimates, these loans will be responsible for creating or saving 38,700 high quality manufacturing jobs in the Midwest, South, East Coast, and West Coast.  

In addition, the auto industry has benefited from government has invested $2 billion to bring advanced battery and other electric drive components to the U.S. This includes grants of $210.9 million to GM and $62.7 million to Ford to produce batteries and components. Compact Power, the Volt and Focus battery supplier, also received $151.4 million grant.

The Dragon awakes. US manufacturers cannot rest easy.  A new McKinsey report forecasts that the market for EVs components will be twice the size of the market for ICE components by 2030.

As with wind and solar, Chinese want a big piece of the clean energy action and preparing to leapfrog directly to selling electric vehicles in U.S. At the Detroit auto Show, BYD (“Build Your Dreams”) had an impressive display with plans to come to the US in 2011. Jury is still out if they are ready for the US market, but it would be a huge mistake to believe that they will never be able to compete. I’m not sure if BYD will want to have as high of profile in DC this year, but if they are, it’s worth a glimpse of the future.

In my next post – to be posted tomorrow – I’ll talk about hybrid technologies and more. Come back for more.