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Alberto De Icaza, Head External Affairs Mexico, ZF Group
Overview of Mexico’s e-mobility market:
The global automotive industry is experiencing the biggest technological change in its history. Mexico is the largest manufacturer of motor vehicles in Latin America and the 2nd largest in North America. Mexico is also the 4th largest producer of auto parts in the world and is highly involved in the technology transformation of this industry. To take advantage of the installed manufacturing capabilities Mexico has in this sector, as well as its affiliation with the USMCA free trade agreement, ZF is experiencing manufacturing growth in new areas of investments, including systems and technologies for the electromobility market in North America.
The Pros of E-mobility
Enormous technological advancements are taking place in the electric vehicle industry, and there is a clear trend to reduce battery costs in the mid-term. The main advantages of the electromobility follow:
• The technologies are environmentally friendly; efforts are being made throughout the industry to reduce CO2 emissions, and electric mobility eliminates tailpipe emissions.
• Eligible for Tax Cuts
• Easy to care for (lower maintenance costs)
• Electricity cost is much lower than traditional Internal Combustion Engine fuel cost
By 2035, Zero Emissions Vehicles sales will be mandatory in the U.S. and Canada, and by 2040 in Mexico. This means the availability of vehicles with combustion engines will be reduced year-by-year and at an accelerated rate by 2030.
Adapting to Electromobility – Obstacles Mexico Faces
The local auto-part industry is moving very quickly into electromobility to support North American OEMs’ transition to manufacture electric vehicles.In Mexico and specifically in the consumer market, New technologies always present a market challenge because their adoption can be slower.
Nevertheless, electromobility has created an opportunity to cooperate to build a green environment.
• Insufficient cargo infrastructure: To begin the transition from fuel stations to charging stations, especially on highways and roads, limits today’s electric vehicles primarily for “city use.” Mexico requires a government incentive policy (not necessarily a monetary incentive) for charging stations to start the transition to electric., This must be supported by the State-owned electric company CFE because, by law, this company is the only one that can distribute energy. This also applies to Hydrogen production, which would be used in Commercial and heavy vehicles that use fuel-cell batteries.
The main challenges that Mexican consumers face as they consider adopting this new electromobility technology are twofold:
• Purchase Cost: As is often the case with newer technologies, the cost of Electric Vehicles is higher than Internal Combustion Engine Vehicles. However, this is expected to change in the near future
Consumer education: An educational campaign to raise awareness among consumers about the benefits of electric vehicles can help increase their adoption rate.
"Hybrid propulsion will allow consumers to experience limited electric mobility and a backup combustion engine simultaneously, improving vehicle gas consumption performance and eliminating the range anxiety between charging stations"
Foster Talent for Mexico’s evolving manufacturing sector.
The transformation of the automotive industry is not limited to electric motors and batteries. There is also a significant change now underway to integrate sophisticated electronics and what the industry commonly calls the Software Defined Vehicle. By 2030, software in new vehicles will control many functions, including those related to safety, entertainment, comfort, and motion toward autonomous driving, making software a large portion of vehicle cost.
The acceleration of vehicle software also represents a major shift in the skill sets of the engineers and technicians required to develop and maintain the new technologies the industry needs. Education in embedded systems and software development is a must. Today, the number of engineers with these skills and education is limited and far from satisfying market demand.
This issue is present all over the world. But in Mexico, there are many Engineering schools with a very high potential, which is a great opportunity. So many automotive and electronic companies like ZF are creating Technical centers for R&D in the country, creating a higher demand for engineers.
As part of our strategic planning, ZF has been working strongly with the most important educational institutions throughout the country, developing and collaborating to design engineering programs and careers to include new skills needed in the industry. With academia, ZF is working to bring the world of industry and the world of research to work closely together in a proactive and effective way. We believe this ultimately will benefit the academic community, automotive technology companies and the community by jointly promoting technological development in our region.
Conclusion:
We are living through a historical transformation in the mobility industry. But this is not the first time. More than a hundred years ago, we experienced a similar transformation of mobility, from horses to cars. At that time, the main obstacles were very similar: A lack of fuel stations on the roads and a lack of enough engineers to design vehicles and engines. Even the technology for electric motors was there, and indeed, the first vehicles were electric. However, the technology for light and efficient batteries was not available.
In those times, every 20 miles, a lodging house/hotel existed where people could change their horses and continue their journey. Through time, those lodging places transitioned to fuel stations, and many kept their cafeteria service.
Now, those fuel stations must start adding electricity/hydrogen charging points.
Today, technology is providing an opportunity for a smooth transition via “hybrid propulsion” technology, which has been available for a few years. Hybrid propulsion will allow consumers to experience limited electric mobility and a backup combustion engine simultaneously, improving vehicle gas consumption performance and eliminating the range anxiety between charging stations. Hybrid technology will also help create new mobility awareness and help encourage consumers to make the leap to full electric mobility.