Stephen Zoepf is the executive director at the Center for Automotive Research at Stanford University.

To kick off the forum, Stephen Zoepf, executive director at the Center for Automotive Research at Stanford University gave a presentation called “Electric Vehicles: Adapting to a Changing Marketplace” to share his insights on what future markets will look like and implications for automakers, suppliers as well as consumers.  

Here are the key takeaways.

The Future is Going to Look Very Different

According to a report by RethinkX, an independent research group, 6 trillion U.S. passenger miles will be driven in 2030, up 50 percent from 2021. Of those miles, 95 percent will be driven in self-driving, electric and shared vehicles and only 5 percent of those miles will be driven by internal combustion engine (ICE) vehicles.

The report goes on to say that autonomous EVs (A-EV) will make up 60 percent of the U.S vehicle stock, and those vehicles will be part of a shared-mobility service. As more people start to share cars, the overall number of vehicles on U.S. roads will drop from 247 million in 2020 to 44 million in 2030.

SEE ALSO: Going Autonomous: The Transformation of the Transportation Industry

The change is already happening. In 2016, shared-mobility companies such as Uber and Lyft drove 500,000 passengers per day in New York City, which is triple the number of passengers from 2015. Today, more and more automakers like Tesla and GM are also entering the shared-mobility market.

EVs are already becoming prominent in major cities around the world. (Source: Time)

The findings illustrate a future where people drive more miles with fewer cars, which are fueled by electricity, and shared instead of owned. It’s a radical visualization of the future, but one that is driven by economic forces.

By 2021, shared vehicles will be 4 to 10 times cheaper per mile than private vehicles, and American households will save an average of USD 5600 every year by switching to shared EVs from cars fueled by gas, according to RethinkX.

Zoepf shared another report by ARK investment Management which echoes the finding above- in the next ten years, people will drive three times more kilometers using half the number of cars and the number of EVs on the road will increase 10 fold.

What It Means for Car Manufacturers and Suppliers

A shrinking vehicle fleet consisting of mostly EVs can only mean one thing: a major disruption to the current automotive market.  

Right now, the average lifecycle of a car in the U.S. is 11 years. However, the majority of a car’s total mileage is driven in its early years. It’s the same for shared vehicles, but they are driven about 80,000- 90,000 km per year, 10 times the distance of privately-owned cars. What this shows is a compression of the vehicle lifespan in its first 3 to 4 years.

These statistics pose critical concerns for automakers.

Will overall vehicle sales decrease in the coming future? According to Zoepf, that’s the wrong question to ask. Instead, automakers should be asking “will I make money?” Automakers have a couple of choices. They can either adapt early on and manufacture EVs and/or A-EVs at a competitive price, or become a shared-mobility provider. Early movers such as Tesla, GM and Volvo are already shifting their business strategies to fit these models.

GM recently launched Maven, a car-sharing service. (Source: The Verge)

Another question to ask is how these trends will affect vehicle design. With shortened vehicle life-cycles, manufacturers can either design cars to last only 3 to 4 years for quick replacements, or opt for the aviation model where the vehicle will be built to last, but the interior parts, such as seats, will be replaced frequently. Whatever route manufactures choose to take, gaining a competitive edge in vehicle and service quality early on will be key.

What Will This Mean for Vehicle Material Suppliers?

If building cars to last is no longer a primary priority, will car makers downgrade their materials? The short answer is not a chance.

Through a customer survey study Zoepf conducted of 60,000 Zipcar customers, he showed that the number one factor when choosing a car is safety. However, there is no one, ideal model or type of car that is preferred in a shared mobility framework. The purpose of the trip determines the type of vehicle, and the success of a shared mobility service provider will depend on the variety of cars it can provide – all with competitive safety ratings.

POSCO ICT already has ChargEV stations set up across Korea. (Source: POSCO ICT)

The supplier’s role will be to continue providing high-quality materials that can boost the safety and cost competitiveness of future vehicles. Steel suppliers have to keep developing lightweight and high-strength steels like POSCO GIGA STEEL, and research new materials that can boost the competitiveness of EVs such as POSCO’s Hyper NO for motor cores, battery materials and POSCO ICT’s EV charging service and infrastructure.

There remain numerous challenges that lie ahead for a greener and safer future with EVs and A-EVs, and it might take longer than experts predict for lawmakers, corporations and consumers to all agree on an optimal mobility model. However, change is already underway and automakers and suppliers alike need to strategize and adapt early on to take advantage of the upcoming opportunities.

For more information on how advanced automotive steel can benefit automakers looking for lightweight and sustainable steel solutions, take a look at our infographic on POSCO GIGA STEEL or read the full report here. 

Cover photo courtesy of GOV.UK.

Contrary to popular belief, mass reduction does not automatically equal fuel savings, especially when it comes to urban driving. There are other factors that determine the fuel efficiency of a vehicle such as driving cycle, vehicle size and its powertrain. Until recently, there was a  lack of variety in engine types and powertrains, so even though automakers reduced the weight of car frames, they could not apply a complementary engine or powertrain to the lighter parts.

So, have automakers been lightweighting for nothing?

Of course not, in the past decade alone, engines and powertrains have also become extremely efficient through advancements in start-stop-systems and downsizing, and newer options including hybrids, electric batteries and range extenders that now allow automakers to capitalize on their lightweight materials.

Although there are several lightweight materials, below are 5 reasons why AHSS continues to be the lightweight material of choice for automakers:

1. Decision Makers Care About the Environment

Well, not everyone, but many countries around the world have started the process to phase out gasoline and diesel-fueled cars, including India and China, the two largest automotive markets in the world. Governments are taking serious action against climate change and it will reflect in their policies. Automakers are choosing to lightweight their vehicles for lower emission rates with AHSS, because not only is AHSS lightweight, there are no trade-offs with other vital features such as safety and cost-effectiveness.

2. Everyone’s Going Electric

Globally, automakers are investing in electric vehicles (EVs) in line with national and international environmental policies. However, EVs still have a ways to go before they become the norm. EVs will face the same safety requirements as regular cars, but with the added responsibility of protecting the battery and its flammable components during a crash.

In 2016 there were several car accidents involving the Tesla Model S, where leaked battery fluids caused fires. Automakers need to find a solution to make EVs as safe, and eventually, safer than traditional cars. As an innovative automotive material, AHSS was built for safety.

3. Safety is Always First

Safety is and should always be the number one priority for automakers, material providers and policymakers alike. Even with all the hype about autonomous driving and sensors, there is very little chance that policymakers will reverse the stringent safety regulations in place today. People want to feel safe, no matter what type of car they are getting into.  

2016 Smart Fortwo and the Mercedes S Class take part in a crash test (Source: Green Car Reports)

One possible material solution is Complex Phase (CP) steel, a type of POSCO GIGA STEEL for the vehicle’s side panels, bumper rails and door impact bars- the parts that determine the safety ratings of the vehicle. It has superior strength and shock-absorbing qualities, without the added weight of traditional high-strength materials, and that’s why carmakers such as GM Korea, Ssangyong Motors and Renault Samsung Motors all use POSCO GIGA STEEL.

4. Cost is Always Second

This goes for automakers as well as drivers on the consuming end. Drivers want lower costs without compromising safety and performance ratings, and desire fuel efficiency- a major reason why automakers are lightweighting.

Some automakers choose alternative materials such as aluminum and carbon fiber to meet lightweight requirements to find that not only are the materials more costly over steel, factories need an equipment overhaul to work with them. Moreover, there are additional costs related to training employees to work with new materials, whereas all auto manufacturers are familiar with welding and forming steel.  

Take a look at this infographic and see how AHSS stacks up against other lightweight materials in terms of cost and performance.  

5. It’s Not Over Till It’s Over

No two lightweight materials are the same when observed under the life-cycle approach, a comprehensive life cycle assessment of a material’s automotive carbon emissions from production to disposal. Often times, the process of manufacturing lightweight materials and improved powertrains result in more carbon emissions than they are saving.

The life cycle assessment can be used to determine the carbon output of a vehicle. (Source: World Auto Steel)

At the end of the day, steel has the lowest production-related emissions and can be recycled at the end of its lifecycle. Steel remains the most recycled material because it can be reapplied in different forms almost infinitely.

Automakers are increasingly incorporating lightweight materials to their new models. Although competition for the greatest market share of lightweight materials is fierce, AHSS is by far the leading material when it comes to lightweight solutions. According to McKinsey & Company’s Lightweight, Heavy Impact report, the percentage of high-strength materials used for cars will increase to 38 percent by 2030, compared to 15 percent in 2010. Steel continues to evolve according to the changing demands of the auto market, and for now, there is no other multi-solution material that can compete.

Cover photo courtesy of Hyundai.

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POSCO’s innovations in steel technology have long supplied material solutions for the automotive industry. Last year, POSCO sold approximately 9 million tons of automotive steel sheets, accounting for 10% of the global automotive steel sheet market. In 2017, POSCO’s focus on providing customers with the most advanced, high-quality steel continues with POSCO GIGA STEEL.

POSCO GIGA STEEL, the Beginning of a New Era

POSCO GIGA STEEL represents the apex of steel technology as it is lightweight, strong, and highly formable – exactly what automakers are looking for. Innovations in POSCO’s manufacturing processes reduce both its production emissions and price, making it a more sustainable and affordable option for car makers compared to other lightweight materials. See how POSCO GIGA STEEL is opening a new era for automotive steel in the video below.

POSCO GIGA STEEL Provides Strength & Safety

Automotive steel is categorized according to its tensile strength. POSCO GIGA STEELS fall into the highest category, which includes steels with a tensile strength rated at more than 1 GPa (Gigapascal), meaning it can withstand more than 100 kilograms-force per square millimeter. In the past, steels with tensile strength ratings this high have been problematic for automakers as they had low ductility and elongation properties.

What makes POSCO GIGA STEEL the ideal material for automakers is its ability to both bend and withstand an immense amount of weight and pressure. POSCO’s ultra high strength giga steel has up to three times more formability than other types of comparable steel on the market, making it ideal for manufacturers.

A car’s safety can also be enhanced significantly when POSCO GIGA STEEL is applied to a vehicle’s BIW (body in white) or front and back bumpers. POSCO GIGA STEEL is not only strong but has exceptional shock absorption during impact.

The strength and safety of POSCO GIGA STEEL have been tested and proven to meet the industry’s strictest safety standards. The POSCO Body Concept-Electric Vehicle (PBC-EV) is a lightweight and safe car body for electric vehicles made with POSCO GIGA STEEL. In safety tests, it received “five stars” from the Europe New Car Assessment Program and a “good” rating from the Insurance Institute for Highway Safety (IIHS) – the highest ratings one can receive from both organizations.

POSCO’s PBC-EV made with POSCO GIGA STEEL is both safe and lightweight.

POSCO GIGA STEEL Helps Deliver Lightweight & Sustainable Cars

Strict regulations on fuel efficiency and carbon emissions continue to push automakers to look for lighter materials to reduce the overall weight of vehicles. However, because stricter safety regulations typically require using heavier body parts, automakers are looking for both strong and light materials to build their cars. Lightweight solutions can be found in some alternative materials, such as aluminum and carbon fiber composites, but there are some drawbacks. For example, although POSCO GIGA STEEL is heavier than aluminum (when measuring equal parts area and thickness), it is more than three times stronger. Therefore, less of it is needed to manufacture products that are as light or lighter than those made with aluminum.

Car bodies manufactured with POSCO GIGA STEEL and other advanced high strength steels could see a 26% reduction in total weight when compared to cars of the same size with internal combustion engines. Considering that the average body weight of medium-sized cars in the early 2000’s was 280-300 kg, this is a remarkable achievement for automakers today.

Also, based on its life cycle assessment measuring carbon dioxide emissions from production to recycling, POSCO GIGA STEEL performs remarkably well as an eco-friendly material. According to the World Steel Association, steel emits 2.0 to 2.5 kg of carbon emissions when producing 1 kg of material while aluminum emits 11 to 12.6 kg when producing the same amount. Even after production, cumulative greenhouse gas emissions of vehicles made with steel is 10% lower when looking at the full life cycle.

POSCO GIGA STEEL Offers an Affordable Option

In automotive lightweighting, a reverse correlation often exists between price and weight. Lighter materials are typically more expensive and heavier materials usually have a lower price. POSCO GIGA STEEL helps bridge this gap by producing automotive steel that is both lightweight and cost-effective.  

Body parts made of POSCO GIGA STEEL can see significant cost savings. Alternative materials like aluminum can cost anywhere from 2.1 to 3.5 times more than POSCO GIGA STEEL. Additionally, current market prices of alternative materials are not expected to decrease over the next ten years.

Facing increasingly strict regulations, POSCO GIGA STEEL offers an ideal choice for automakers to build stronger, lighter, and more sustainable cars. According to POSCO Research Institute (POSRI), advanced high-strength steels (AHSS) like POSCO GIGA STEEL should see increased demand, accounting for 69% of total steel plates by 2023.

Throughout April & May, The Steel Wire will explore how POSCO is leading the automotive steel market with its innovative steel products like POSCO GIGA STEEL. Don’t miss any of the exciting stories from The Steel Wire – subscribe via email today.