TECHNOLOGY, VALUE ADDED AND SUPPLY CHAINS OF ELECTRIC VEHICLES

by Michael Pieper, agiplan Gmbh and Christian-Simon Ernst, fka GmbH

The BEV has only few simple mechanic components. Because the electric motor can deliver a constant and high torque over a brought range of speed, most BEV don’t need a reduction gear box. This gives a lot of new freedom for the design.
A big drawback is the battery itself. It is big, heavy and expensive and can hold less energy than a fuel tank.
Most BEV are built as lightweight constructions and use the limited electric energy very efficient. The pure costs for operation (consumption, maintenance) are significantly lower than those of conventional cars.
We expect BEV to be competitive, concerning total cost of ownership (TCO), first for urban delivery services, commuter services and on site traffic. Those BEV run high daily mileages on frequent routings with good access to recharging points.
Private customers are willing to accept slightly higher costs for BEV compared to conventional cars, but for that, prices have cut down dramatically. A mass market for BEV depends on acceptable prices, which means mass production and development of new process technology i. e. for batteries.

Analysis of the value added for BEV, compared to ICE

Two major criteria can be analysed to predict the make-or-buy decision of an OEM concerning BEV. This is value added in production and consumer value.
Important for the OEM is the combination of value added in production and customer value. In simple words, the higher the value added and the customer value, the more important it is for the OEM to make the component.
A BEV comes along with 63 % higher value added, which is mainly generated at the supplier for the battery cell. About 75 % of the ICE drive train production value falls away. This is an important and not surprising message for the suppliers.


Figure 1: Comparison of value added

For the BEV we expect most OEM to produce engine management, integration of batteries and electric systems, thermal and battery management. Suppliers will develop and produce transmission, battery cells, power electronics, high voltage wiring and comfort/safety/infotainment components.
Analysis of the supply chain for BEV
As we analysed some of the today (2011) available BEV, we found supplier relations, which are not suitable for an efficient mass production. There are no strong supply chains, but many one-on-one relations. The production can be characterized as batch style.
To bring down the prices for BEV we need an efficient mass production and supply chains, like those established for conventional cars. Due to the know-how required for vehicle development and production lines we anticipate, that we will find the most of today’s players also in the future EV-industry.
For new players we see chances in the EV supply chain as:
•    Technology leadership for e-components
•    System integrator for EV-specific systems
•    Manufacturer of niche market BEV