Reimagining the auto industry’s future: It’s now or never
Disruptions in the auto industry will result in billions lost, with recovery years away. Yet companies that reimagine their operations will perform best in the next normal.
By Thomas Hofstätter, Melanie Krawina, Bernhard Mühlreiter, Stefan Pöhler, and Andreas Tschiesner – Electric mobility, driverless cars, automated factories, and ridesharing—these are just a few of the major disruptions the auto industry faced even before the COVID-19 crisis. Now with travel deeply curtailed by the pandemic, and in the midst of worldwide factory closures, slumping car sales, and massive layoffs, it’s natural to wonder what the “next normal” for the auto sector will look like. Over the past few months, we’ve seen the first indicators of this automotive future becoming visible, with the biggest industry changes yet to come.
Many of the recent developments raise concern. For instance, the COVID-19 crisis has compelled about 95 percent of all German automotive-related companies to put their workforces on short-term work during the shutdown, a scheme whereby employees are temporarily laid off and receive a substantial amount of their pay through the government. Globally, the repercussions of the COVID-19 crisis are immense and unprecedented. In fact, many auto-retail stores have remained closed for a month or more. We estimate that the top 20 OEMs in the global auto sector will see profits decline by approximately $100 billion in 2020, a roughly six-percentage-point decrease from just two years ago. It might take years to recover from this plunge in profitability.
At the operational level, the pandemic has accelerated developments in the automotive industry that began several years ago. Many of these changes are largely positive, such as the growth of online traffic and the greater willingness of OEMs to cooperate with partners—automotive and otherwise—to address challenges. Others, however, can have negative effects, such as the tendency to focus on core activities, rather than exploring new areas. While OEMs may now be concentrating on the core to keep the lights on, the failure to investigate other opportunities could hurt them long term.
As they navigate this crisis, automotive leaders may gain an advantage by reimagining their organizational structures and operations. Five moves can help them during this process: radically focusing on digital channels, shifting to recurring revenue streams, optimizing asset deployment, embracing zero-based budgeting, and building a resilient supply chain. One guiding principle—the need to establish a strong decision-making cadence—will also help. We believe that the window of opportunity for making these changes will permanently close in a few months—and that means the time to act is now or never. more>
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Tagged Business improvement, Capital, Government, Health, Internet, Jobs, McKinsey, Skills, Super regions, Technology
Unselfish Molecules May Have Given Rise to Life
New research from Center for Chemical Evolution demonstrates experimentally evaluates alternative model to ‘RNA World’ hypothesis, emphasizing collaboration and co-evolution
By Moran Frenkel-Pinter, Nick Hud, Loren Williams – It’s a question older than science: How did life begin? In modern biology, life depends on life to live. But how did the mutualistic relationship between different molecules – which led, eventually, to complex biological systems, like human beings, for example – actually come to be?
For many researchers, the answer lies within the ‘RNA World,’ a widely-accepted hypothesis in which self-replicating RNA proliferated, serving a dual role as both genetic polymer and catalytic polymer, long before the evolution of DNA and protein.
The RNA World model is an attractive cradle-of-life premise, according to Georgia Institute of Technology researcher Moran Frenkel-Pinter, “because it avoids the extreme improbability of simultaneous independent origins of two different types of polymers. According to that theory, over time the RNA World incrementally invented the ribosome, giving rise to the current biological system comprised of RNA, DNA, and protein.”
She adds, “it’s kind of a parsimonious idea, basically saying that RNA made everything. But there is a much simpler solution.” Frenkel-Pinter and her research partners have offered an alternative – the concerted evolution of polymers – of nucleic acids and proteins. “A Ribonucleoprotein World,” quips Frenkel-Pinter, a research scientist and former NASA Postdoctoral Fellow who works in the labs of Nick Hud and Loren Williams at Georgia Tech, and is the lead author of a recently published paper that provides experimental support for this model.
The paper, “Mutually stabilizing interactions between proto-peptides and RNA,” in the journal Nature Communications, describes the chemical linkage that could have been at play during the origins of biopolymers. Their results suggest that neither nucleic acids or proteins came first, but that RNA and proteins were selected together through a process of co-evolution. In other words, it wasn’t a single selfish gene competing for survival that drove evolution; it was the rising tide of collaboration between molecules from the very beginning. more>
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Tagged Business improvement, Capital, Evolution, Health, Internet, Molecule, Skills, Technology
Announcements from Tesla and CATL show that a long-lived, cobalt-free and competitively price EV and grid/home batteries may finally have arrived.
By John Blyler – The much discussed 1 million-mile (1.6 million kilometers) battery may now be a reality. As the name suggests, these batteries would last for 1 million miles without breaking down. Tesla, along with China-based Contemporary Amperex Technology (CATL), have announced such a battery that not only lasts longer but also costs less than $100/kWh and uses cobalt-free materials. Why are these two features important?
It has long been a metric for the success of electronic vehicles (EV) that their battery energy density be on parity with traditional gasoline-powered engines. Such a condition would allow EVs to compete with gasoline vehicles on both weight and range – especially the latter. This means that, if gasoline is 100 times more energy-dense than a battery, that a vehicle would need 100 lbs of battery to go as far as 1-lb of gasoline.
But past studies by the Argonne National Labs have shown that system efficiency is another key consideration when comparing EV and gasoline energy densities. The research lab noted that electric powertrains are far more efficient than powertrains powered by gasoline. In many cases, less than 20% of the energy contained in a gallon of gas actually gets converted to forward motion. After that power has been transmitted through a transmission and differential to the wheels, it would have suffered significantly more mechanical losses.
By contrast, an electric powertrain can be more than 90% efficient. This would suggest that the energy density of an EV battery could be far less than equivalent to a gasoline-powered vehicle and still come out ahead. more>
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Tagged Battery, Business improvement, Electric vehicles, Manufacturing, Skills, Technology