China continues to be the leading country for e-mobility in terms of industry and market, according to the E-Mobility Index 2019 from fka GmbH and Roland Berger GmbH. Although Germany takes the lead from France in terms of technology for this latest report, China is catching up quickly and ranks second in terms of technology for the first time.

The joint country comparison combines the three key areas of technology, industry and the market and enables an objective examination of the status quo in the field of electric mobility in China, Germany, France, Italy, Japan, South Korea and the USA.

China no longer shares the overall lead with the USA; rather it has now set itself apart, pushing the USA into second place.

—E-Mobility Index 2019

Technology. German manufacturers (OEMs) are increasingly focusing on full battery-electric vehicles for the compact and small car segments, while full electrification of mid-size vehicles and partial electrification (plug-in hybrid electric vehicle, or PHEV) of SUVs continue to progress.

Due to lower vehicle weights, this results in an increase in range/battery capacity ratio and thus an improvement in terms of the vehicles compared.

Chinese vehicles are improving significantly and becoming safer and more efficient. Due to new Chinese laws and regulations, charging technologies that enable faster charging with direct current (DC) are increasingly being installed in Chinese vehicles. Chinese OEMs continue to focus on a portfolio of low-cost small and mid-range BEVs, according to the report.

Korea defends its third place in terms of technology. Korean OEMs are less focused on introducing new models, and more on improving technologies. The average range and efficiency of Korean vehicles have increased, with correspondingly slightly higher vehicle prices.

France drops to fourth place, while Japan drops from fourth to fifth place. As in the previous year, Japanese OEMs are focusing on the expansion of plug-in vehicles. Japanese manufacturers are placing few new all-electric vehicles on the market.

Although US BEVs are leaders with regard to electric range, the portfolios of all American OEMs increasingly include electrified SUVs and a bigger share of PHEVs, which reduces the average technological performance of the vehicles under evaluation. Both German and American vehicles belong in the high-price segment.

Industry. In terms of industry, China and USA share first place. However, China leads with absolute higher xEV (BEV and PHEV) as well as cell production.

In China, battery cell production in 2017-2022 is expected to increase by more than 1,000% compared to the same period last year (2016-2021). No other nation plans such a large expansion of its domestic cell production, confirming China’s leadership in terms of industry.

Market. Sales figures for battery and plug-in hybrid electric vehicles rose significantly in all countries except Japan in the period Q3 2018 - Q2 2019. For the first time, the share of partially or fully electrified vehicles in all new Chinese registrations exceeded the 5% mark. Compared to the previous period (2018), Chinese sales are growing at approximately 160%.

France, South Korea, the US and Germany exceeded the two percent mark of the xEV sales ratio for the first time. France is ranked second ahead of a strongly growing South Korean market (+189%). US ranks fourth with an increase in sales share of more than 2.3 percent of all newly registered vehicles.

The market outlook continues to be positive, but electric vehicles are less profitable for OEMs than conventional vehicles. Automakers could increase their profitability levels with new Battery-as-a-Service models.

—Wolfgang Bernhart, Partner at Roland Berger

Besides being behind on cell production, European OEMs also have a profitability problem. The losses incurred in the switch to electric drives could be diminished through greater cost efficiency, but profitability would still struggle.

The revenue gap could be closed in the future by new business models focusing on Battery-as-a-Service (BaaS), the consultants suggest. Some providers are already offering a Battery-in-the-Cloud service for managing and monitoring the battery life of electric vehicles. It enables the recording of real-time data on charging speed, charging cycles and ambient temperature, among other things. With this information as a basis, recommendations can then be made regarding driving style or necessary maintenance checks.

There are starting points for many different business models along the entire lifecycle of the battery. An integrated value chain covers everything from offering customers battery leasing plans to recycling the raw materials at the end-of-life.

—Wolfgang Bernhart