Richard Parry-Jones chairs the UK government’s ‘Automotive Council’. Here, he tells Dave Leggett how he sees the strategic challenges involved in meeting lower CO2 targets in motor transport, electric vehicle technology and how he sees the role of the Automotive Council. This interview is the second part of a two-part interview.
Dave Leggett: What’s your view on electric drive and electric vehicles?
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Richard Parry-Jones: It is obviously an important area for the future. But I think we have to distinguish very strongly between hybrids and electric cars – they are fundamentally different things. Many people think they are two varieties of the same species, but they are actually completely different species.
A hybrid car still uses, exclusively, fossil fuels for its energy source and it is using the medium of electricity to find better ways of harnessing all of the energy from that fossil fuel that it receives in the fuel tank. Electric cars, on the other hand, are a different species because they are trying to replace fossil fuel burned in the car with electricity and a different primary energy source.
Electric energy, unlike petrol, is not a primary energy source. It doesn’t exist in nature. It is a medium that is used to transport and store energy that is generated from a primary source, such as fossil fuels, nuclear power, or wind, hydro and solar energy. In the short term, one could be cynical and just say, well that’s just burning fossil fuels somewhere else, so there is an energy generating infrastructure issue. Until the grid becomes much more powered by renewables and/or nuclear, then the environmental benefits of electric cars are very questionable.
And yet electric cars are very expensive and come with severe range limitations. Their short-term prospects are driven, almost exclusively, by a mixture of government incentives and policy, and the marketing efforts by car companies – the EV leaders wanting to be seen as progressive and to be joining he trend or fashion.
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By GlobalDataHowever, if we are going to get emissions from motor transport down to about 20% of their current levels, then the average ICE car is important. If the average is say 140g/km of CO2, I believe we can get that down to 70g/km, maybe even 60g/km. But we need to get under 40g/km and I don’t see how we can get to that relying only on fossil fuels.
We are going to have to find a different energy source and there are only really three candidates: biofuels, hydrogen and electricity.
The last two are not pure energy sources, they are energy transport mediums and not freely available in nature. So you have to find a primary energy source – nuclear or renewables – and then decide, do I use that to generate hydrogen as a transport medium or electricity as a transport medium?
I am somewhat sceptical about hydrogen as a sensible transport medium for energy created through nuclear or renewables. My money is on electricity. I think in the long haul – and by that I mean 2030 not 2020 – I think we will have to see the mass market for electric vehicles develop. Hopefully by then, as a result of massive investment in battery technology and so on, we will have vastly improved the range but I do not believe we will ever match the range of the current liquid fossil or biofuels vehicles.
The challenges are huge – battery materials are not abundant and recycling technology has much further to go. I think that even in 2030 there will be a sizeable section of the vehicle market that will be powered partly by electricity and partly by biofuel – and these are the so-called plug-in hybrids. But these vehicles will struggle to do well in the current market without significant government incentives because it is so expensive and what are the incentives for customers?
DL: What about the argument on the production economics that says when take up is large enough unit costs will fall dramatically?
RP-J: No, that won’t do it. The fundamental technology is more expensive than what we have now. This is not simply a scale and learning issue. Scale and learning will reduce the cost of batteries by another half. That will take them down from US$6,000 to US$3,000.
DL: You are saying that battery technology is inherently very expensive and there is not much we can do about that?
RP-J: I’m afraid so. I wish that was not the case. I have heard people say, ‘we are in the early phases and it will get a lot better’, but people have been working on batteries for around 100 years. They will continue to improve but for it to be very different we need something spectacular which, if you look at the basic physics, is probably just not do-able, in terms of making them as cheap as today’s cars.
They will remain significantly more expensive than today’s cars.
Of course, making them affordable is the job of the industry, but it is going to take a lot longer than five or ten years.
DL: So there is a need for realism?
RP-J: Yes. Look, I am a fan of electric cars and I like driving good ones. But I fear that they are being overhyped.
I would hate to see electric cars over-hyped and then for the market to be disillusioned with them when, in fact, we are going to need them in significant scale and volume in 10-15 years’ time. I am very keen that we don’t destroy their development now by overplaying their current capabilities.
DL: And you see a significant role for second generation biofuels?
RP-J: Certainly, and they will become more competitive as the price of fossil fuels rises. They also have the advantage of being the most compatible alternative to fossil-fuels with the present fleet and infrastructure, so carbon benefits are potentially realised faster. But there will be tremendous competition for the use of biofuels, for example from the aviation sector. So, yes, a role for them in motor transport, but they are not a panacea.
Electricity is I believe the most likely primary replacement energy medium, with biofuels as a supplementary replacement. Market mechanisms will likely direct biofuels towards situations where electricity won’t work – such as aircraft and long-range car journeys, not forgetting heavy goods vehicles, too.
DL: You are co-chairing the UK government’s ‘Automotive Council’. How does that work?
RP-J: A look at history shows that our industrial competitor countries have successfully employed a more strategically collaborative approach between manufacturing industry and government than has been the case in Britain. The UK government’s approach in the past has tended to be characterised by emphasis on moving away from being a nation that designs and manufactures things, to a service economy with financial services in the City figuring prominently in the thinking.
Attitudes to manufacturing, and the auto industry in particular, have been ‘laissez-faire’ until a disastrous headline looms, say caused by the possible closure of a plant. In these cases we are thrown into panic mode. Depending on the government of the time, we either say it’s all hopeless and the patient is dead, let’s perform the last rites, or we throw billions of pounds at it in a fruitless attempt to resuscitate a patient that is already clinically dead.
What we need is a preventative approach, where we are working together to promote good health. We think that is a lower cost approach and one that is far more likely to lead to more sustainable employment and economic contribution from the industry.
We have convinced the UK government, I think, that you can’t really have a manufacturing sector unless you have a viable automotive industry because of the scale and innovation that the automotive sector encourages for manufacturing generally. Automotive embraces all of the important elements in manufacturing –
manufacturing itself, joinings, stamping, pressing, forming, forging, casting, machining, logistics, assembly.
Most of the innovation in manufacturing has come out of the automotive sector, starting with the moving assembly line right the way through to lean production. Global competition has forced massive innovation in the automotive industry, historically.
We think it is really important for the government to proactively support the auto industry if it wants a viable manufacturing strategy.
What we are not looking for is huge handouts and big subsidies to broken companies. That doesn’t work and is a waste of money.
We are looking, first of all, for a change of rhetoric. If you are a foreign investor in the manufacturing sector, what you want to read in your newspaper is not that the British government believes that manufacturing is a no-hoper in the UK. That won’t encourage you to invest in Britain. A more positive message would be that the British government believes that manufacturing is part of the modern knowledge economy, that it happens to make things using smart people and smart technologies. Most people have got a very outdated image of what a manufacturing plant looks like.
And when the tone from the top and government changes, we can attract more young people to manufacturing.
The second thing is that the government has to stop being anti-car. There has been a lot of anti-car sentiment coming from government driven by what I call ‘the south-east effect’. It all looks feasible from London to replace the car with some other form of mass transportation but it just doesn’t work outside London.
We are saying, very simply, ‘please work with us.’ Cars are not going to go away in a modern transportation system, so let’s work together on all the things that need to be done, in a joined up way, to get the best outcomes from an economic and sustainability perspective.
DL: So there’s that high-level strategic picture that involves talking to government about policy and how the industry moves forward. Is there a
specific R&D aspect, too?
RP-J: Yes, at a lower level there are more specific interventions to ensure that the money that the government does spend to encourage R&D is spent in the right areas. The whole idea is to get everyone together and coordinating properly.
DL: What do you see as the big challenges for the auto industry globally?
RP-J: I think it goes beyond the CO2 problem, which is just one of the challenges under the heading of personal mobility sustainability. We are overdependent on imported fossil fuels, which are located largely in unstable geopolitical areas and depleting much faster than reserves. This will lead to increased price volatility caused by various political crises, and a rapidly escalating underlying trend price for oil.
By the time each crisis hits us, it is far too late to respond with new technology, so we need some intelligent, technology neutral fiscal market intervention by Government. There is also recycling, longevity of product and there’s the whole life impact of resource consumption in personal transportation. The auto industry has to use its brain and muscle to help figure out solutions that benefit everybody.
The problem of CO2 is not to be underestimated, but I see it as a part of this broader sustainability question.
Just stepping back, one problem I think we have is how market mechanisms work and how we incentivise customers to favour sustainable solutions and lifestyles over less sustainable ones. The problem we have with the free market and the economics of sustainability is that the free market will not drive customer behaviour quickly enough. The risk is that by the time resources become prohibitively expensive we will be over-committed to the use of those resources and the rise in raw material and commodity prices will be so abrupt that we will undergo a period of crisis.
The winners in this industry will be the ones who invest in technology and can innovate beyond immediate pressures. Shareholders tolerance for that is notoriously weak and consumers responses are limited. This issue can be addressed by Government providing a long term stable policy of escalating carbon-based tax on fuel, to provide consumers, car companies and investors with much improved certainty about the future attractiveness of low carbon vehicle technology. Of course, the challenge for governments is how do you stay elected and still incentivise consumers to do things that are in their long-term best interests, but not always in their short-term best interests.
For example, governments feel that they don’t yet have the freedom to impose swingeing carbon taxes – they simply cannot do it in democracies. If they go too far they will simply be voted out. They have to educate the voters and we have to educate consumers on what is in their best interests. That’s why it has to be done gradually, over a sustained period of time, so that customers and business has a chance to adapt and adopt new technologies, without causing hardship.
Maybe we have come full circle now, and perhaps you can see why I am spending a third of my working time on policy development – things that I know the industry on its own can’t fix.
DL: Are you optimistic about the future for the auto industry?
RP-J: Yes, for two reasons. One is that I think that having invented personal transportation, it is such a fantastic thing for humankind that I cannot conceive of a situation where humankind will forego it without huge resistance. And on the contrary, what we are seeing is developing countries embracing it.
And I’m optimistic about the sustainability aspect because I really believe in how smart we are as engineers. If you look at what we have achieved in the last 100 years without anything like the same pressures on sustainability that we are facing for the next 100 years, I’m incredibly optimistic about the ability of engineers to find ways of reconciling apparently conflicting requirements. It is what engineers do best.
DL: Thanks Richard. Before you go, can I just ask you what you are driving these days?
RP-J: Well, apart from my bicycles – and I am a big fan of the Brompton fold-up bike, best way to get around central London. My daily transport in Wales, where I live, is a Focus. My workhorse is a diesel Range Rover which I use for my outdoor sports and transport needs. It is useful for towing – my partner is an equestrian, so we tow horseboxes, as well as boats. The Range Rover is the ultimate Swiss army knife vehicle. I also have in the garage an Aston V8 Vantage for fun drives on summer Sunday mornings.
See also: Q&A with Richard Parry-Jones (Part 1)
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Richard Parry-Jones
Richard is an automotive engineering leader who worked for the Ford Motor Company for 38 years between 1969 and 2007. Until his retirement from
Ford at the end of 2007, he spent nearly ten years as Group Vice-President in charge of R&D for all of Ford and its subsidiary companies worldwide,
leading a staff of 30,000 professionals in a network of Product Development centres in 15 countries.
He was also the Company’s Chief Technical Officer for the last 8 years.
Richard is now working on a variety of projects, having formed an engineering consultancy company with a blue chip client portfolio.
He also holds a number of non-executive directorships, and works on governance with several Universities (Loughborough, Cambridge, Warwick
Business School)
He chairs the Welsh Assembly Government Advisory Group for developing policy on Economic Growth, Transport and Energy, and co-chairs the UK government’s ‘Automotive Council’.
