John McIlroy 2019-05-15 11:20
JLR boss suggests that going it alone over EVs is the firm’s preferred option, while other industry players seek partnerships
The Volkswagen Group recently announced that it is interested in licensing its forthcoming MEB pure-electric vehicle architecture to rivals such as Ford, and Toyota is opening up tens of thousands of patents relating to the hybrid technology it has developed over two decades. Both companies believe that sharing this information and technology will help them to drive down their own costs due to increased economies of scale on components.
However, speaking at the Financial Times Future of the Car Summit in London, JLR CEO Dr Ralf Speth said he believed his company’s compact size would allow it to be agile – and that it would resist the temptation to seek partnerships on that front.
“I guess I see it in a different way,” he said. “You can talk about economies of scale and that’s correct. But on the other hand, there’s the freedom we have to develop and do our own strategy in a fast way, a structured way. This gives us a lot of power.
“In the UK we’re a big company, but in international terms we’re small, a design house. We deliver outstanding vehicles to special customers. Being small and nimble is also an opportunity to be agile; the I-Pace shows this best.”
Speth said that that contrary to the industry thinking, he expects battery costs to actually rise in the short term due to a shortage of demand.
“The supply of batteries is limited,” he said. “That means that for the next two to three years, I don’t think we’ll see a cost reduction. Even more so, I think the cost of batteries will go up. The whole of the industry thinks they’ll go down but at the moment demand is higher than supply – so the normal economic law applies. It’s only when supply catches up that costs will go down.”
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