Vacuum Degreasers and Aqueous Solutions
Published

The Changing Landscape of Automotive

Products Finishing editor-in-chief Scott Francis considers the future of automotive beyond the pandemic and in the advent of electric vehicles. 

Share

automation, automotive industry, liquid coating, automotive

Photo Credit: ABB Robotics

If you ask folks to speculate about the future of the automotive industry, you’ll get a range of interesting, often contradictory answers. I know because, over the course of the development of this issue, we’ve been talking to experts from various facets of the industry, from automation technology experts to suppliers to economists to thought leaders plugged into the industry’s developing trends. Depending on who you talk to, you’ll get a different vision of the future. Some foresee a day when transportation is largely made up of rideshares, fleet vehicles and autonomous cars. Others can’t imagine people moving away from personally owning vehicles.

I am reminded of a scene in the 1992 Cameron Crowe film Singles. A Seattle Department of Transportation civil servant, Steve (Campbell Scott) has his monorail project shut down by the mayor (Tom Skerritt). Steve passionately makes his case, running down the list of the benefits his monorail would provide, from improving air quality to reducing traffic. The mayor tells him flatly, “People still love their cars.”

That sentiment seems to be the crux of what makes the automobile industry what it is. There are 287.3 million cars in the U.S. and 230 million licensed drivers. There are 328.2 million people in the U.S., meaning that roughly 70% of the population is driving. On average, there are 1.88 vehicles per U.S. household. Today, the nation has the second-highest motorization rate in the world, with around 800 cars to every 1,000 people.

Numbers aside, any commute on any given day will tell you — we drive. A lot. So how has the COVID-19 pandemic affected that? 2020 has been challenging for every business sector. You don’t have to look far to see the effects of a year suffering from the economic ramifications of a global pandemic. The automotive retail lots tell a story. Inventory is sparse. The delivery of new vehicles has been hamstrung by supply chain disruptions and production delays, resulting in inventory shortages. New cars and trucks are lacking and used cars’ market prices have soared this year, up 15.2%. Yet, while this may sound like a grim portrait for the industry, there’s another side to the story.

People are still buying cars.

That’s not to say that segments of the population aren’t struggling — absolutely they are. But if you look at new vehicle sales in the premium vehicle market, they’re still fairly strong. When it comes to luxury cars, large SUVs and full-sized pickups, almost no 2021 inventory is available. According to Michael Guckes, chief economist and director of analytics for Gardner Intelligence, inventories of current model year vehicles are extremely low, at 2.63 months vs. 3.6 months at the end of 2019.  This gives dealers greater negotiating power.

“If you want a particular model of something that’s high-end right now, you almost have to beg the dealer to find someone who can get it to them,” says Guckes.

The overall result is that, despite the slowdown created by the pandemic, things weren’t as bad for the industry at large as they seemed like they might be initially.

“You didn’t get that huge surge in inventory that the dealers had to somehow get rid of, and that’s why no one in the government has mentioned anything about cash for clunkers,” says Guckes. “It’s just a fundamentally different type of situation for the automotive industry this year because the slowdown was on both the supply and the demand side this time.”

Disruptions in the supply chain from COVID continue and suppliers may need to rethink some of their processes, possibly investing in new automation technologies to keep up with demand.

Lower-priced new vehicle sales are struggling the most. Guckes points out that the divergence between sensible cars and luxury vehicles has been happening for some time, suggesting that the buying decisions consumers make when it comes to cars are driven more by image than necessity. Shocker, I know.

Which brings us to another often debated question: what role will electric vehicles (EVs) play in automotive in the years to come? With increased awareness of global climate change, changing consumer habits and improved battery technology, could the moment for EVs have arrived?

The answer to that is murky and again, you’ll get a different answer depending on who you ask. At the moment, the quest is on to improve battery performance and lower prices. For EVs to compete with traditional cars, the cost needs to improve. Currently, almost all EVs on the market cost more than $30,000. This plops them in the luxury category competing against all of the cars people drive for reasons other than practicality.

According to Matt Sikowski, the director of the Paintshop Process and Application Technical Group at FANUC America, this puts EV at the forefront of some of the trends in finishing.

“Look at some of the price points on a lot of these cars when they first come out,” he says. “I think they’re trying to get that luxury look in a paint finish to help sell it at those price points.”

Sikowski is referring to trends towards adding more layers, mixing and matching different types of application equipment and generally trying to achieve new color effects that haven’t traditionally been seen in the typical automotive industry. In addition, paint vendors are investigating different types of paint materials to help enable autonomous vehicles. Sikowski points out that different paint colors are more easily detected by LIDAR radar systems. The colors and even application methods for paints for such vehicles could play a role in future coating innovations.

Of course, the batteries themselves need coatings in order to maintain temperature, shield against electrical interference and reduce the risk of fire. The EV market is currently growing and there’s plenty of work just around optimizing batteries.

So what does it all mean for suppliers?

Whatever the mix of combustion vs. electric vehicles ends up being, putting your eggs in any one basket is generally a bad idea. Will combustion vehicles go away any time soon? Unlikely. Will EVs play an increasingly important role in the automotive sector? Most definitely, whether that is for individual drivers or as part of fleet vehicles in urban areas. No matter what, its bound to be a wild ride. Buckle up.

Echoflex modular ultrasonic cleaning machines
Cleaning Technologies Group
high-performance systems for efficient parts cleaning
Cleaning questions ask Kyzen
Pickelx one step metal prep
vacuum vapor degreasers
Precision Cleaning Solvents
New Acid-Free Bright Nickel Process

Related Content

automotive

Henry Ford Is Still Right When It Comes to Color

Who would have imagined that more than 100 years after his famous statement about any color as long as it’s black would still have relevance of a sort?

Read More
Electroplating

Pulling Out All the Stops

Evolving coatings and finishes for automotive brake components. 

Read More
Electrocoating

Coatings Plant Evolves with Market Trends

Expanding its focus from exclusively serving the RV industry, one of this company’s stand-alone coatings plant has successfully extended its services to additional markets.

Read More
Electroplating

The New Wild West of Automotive Finishing

The advent of the EV and new application opportunities for finishers.  

Read More

Read Next

sustainability

The Road to Recovery

The past few issues of Products Finishing have touched on how different market sectors have been affected by the coronavirus pandemic. As we come to the end of the year, PF editor-in-chief Scott Francis takes time to reflect on the manufacturing industry’s response during the COVID era and to contemplate finishing’s role in the medical sector.

Read More
editorial

Products Finishing Then, Now and Tomorrow

As 2020 comes to a close, Products Finishing editor-in-chief Scott Francis discusses upcoming initiatives for 2021.

Read More
Vacuum Degreasers and Aqueous Solutions