What Matters More: Autonomous or Electric Cars?
By Abbie Westra on Nov. 16, 2017SCOTTSDALE, Ariz. -- Think electric vehicles will change the face of convenience retailing forever? Think bigger.
“[That’s] thinking in a linear fashion,” said Norman Turiano, principal consultant for Turiano Strategic Consulting. “Autonomous vehicles are going to completely disrupt the business.”
Turiano, along with other experts from the fuels, transportation and auto industries shared their prognostications on the future of the forecourt during a panel discussion at Winsight’s Outlook Leadership conference in Scottsdale, Ariz., held Nov. 12-15.
Read on for answers to four big questions about the forecourt tipping point ...
1. Is EV growth accelerating?
“The year 2017 was a big one for the future of the forecourt,” said Samantha Oller, managing editor of CSP magazine and moderator of the panel. “Many current incumbents in energy infrastructure have been sharply revising their own, more conservative projections for electric vehicles (EVs). OPEC (Organization of the Petroleum Exporting Countries) increased its projections for the size of the global EV fleet more than fivefold. ExxonMobil and BP both increased projections from 40% to 50%. The International Energy Agency more than doubled its projection.
“These upward revisions all took place in space of only one year.”
Garrett Fitzgerald (pictured here), manager of fleet electrification for the mobility transformation program at the Rocky Mountain Institute, Basalt, Colo., cited a few reasons for the shift, including policy changes, decreasing costs and an increase in EV models.
The globalization of the auto industry, with American manufacturers producing for foreign countries and vice versa, also makes for a larger number of EVs in production.
2. Hydrogen vs. electric: Which will win?
When asked about hydrogen, the panelists had mixed feelings. Devin Lindsay (pictured here), principal research analyst of alternative propulsion forecasting and market analysis, IHS Markit, Englewood, Colo., said he could see a future where both hydrogen-fueled and battery electric cars coexist, while Fitzgerald was more hesitant.
“We’re going to figure it out with the batteries before there’s time for this,” said Fitzgerald, pointing to the expensive, risky process of distributing and storing hydrogen. “Does it make sense from a society perspective to invest in that infrastructure?”
And while a decrease in charge times on EVs will be critical for c-stores trying to get into the game, what’s at risk with DC fast chargers is their impact on the lifecycle of the battery itself. It's critical that improvements to both chargers and batteries progress in harmony, the panelists said.
3. Is it all for naught?
The disruptor set to absorb and eclipse all others is autonomous vehicles. The sharing economy has already prepared consumers to cut ties with car ownership for good, and panelists expect autonomous vehicles to be "owned" by Uber-like companies (or car companies themselves) vs. individuals. The way these companies would fuel or charge their fleets will likely differ greatly from the traditional habits of individual consumers, using more centralized hubs. And they may very well choose electric as their "fuel" of choice, which could further speed up EV production.
Already most cars are coming off the factory line with autonomous options, making sea change a fast proposition. Waymo already has an autonomous vehicle on the road in a test in Chandler, Ariz.
“We’re in a tricky spot: How much infrastructure do we put into this, only to have it disrupted by autonomous vehicles?” said Fitzgerald, who cited the $20 billion that has been invested into autonomous vehicles just this year.
Turiano and Fitzgerald both pointed out that most cars owned by consumers in America are either sitting or idling 96.5% of the time. “I don’t want to own it, store it or insure it,” said Turiano.
“We’re not going to convince consumers. Consumers are going to tell us what they want,” he added.
4. So when’s the disruption tipping point?
Oller asked her panelists when they believed the industry would finally see the tipping point of disruption on the forecourt. Lindsay estimated 2030: “That’s when consumers will really start driving the demand—the convergence of technology and consumer demand.”
Fitzgerald was more aggressive, citing 2020 to 2025, especially in urban areas. “We won’t be through the disruption, but [it will have begun].”
Turiano (pictured here) pinpointed 2025 as not necessarily when the tipping point will happen, but rather when it will begin to greatly affect the c-store industry. “There’s going to be changes in consumer demands around then [that will] affect our sales,” he said.