For traditional auto parts suppliers, the electric car may prove to be the meteor that wipes out the dinosaurs.
As many as 75 of the industry's top 100 suppliers will face irrelevance by 2030 unless they establish a niche in the market for electrified cars, concludes a just-released study.
"Vehicle electrification is coming much faster than most industry analysts expect," said Paul Eichenberg, a suburban Detroit consultant who authored the report. "Many CEOs are so focused on this quarter's earnings that they are not seeing the future."
By 2030, 57 percent of vehicles produced each year will be electric vehicles, plug-in hybrids or vehicles with 48-volt electrical systems, Eichen-berg predicts.
That will create a $213 billion annual market for the batteries, motors and electronics required to power EVs, plug-in hybrids and mild hybrids.
The warning is certain to resonate this week in Traverse City, Mich., where automakers, suppliers, consultants and vendors are gathering for the Management Briefing Seminars, an annual industry deep-dive hosted by the Center for Automotive Research of Ann Arbor, Mich. Many attendees there know the auto business is spinning from the pace of rushing toward self-driving vehicles.
Many believe the shift to autonomous technol- ogies and electrification go hand in hand — both trends ushering in radical technological changes.
The question posed by Eichenberg, a former vice president of strategy at Magna Powertrain and Magna Electronics: How many companies will the changes leave behind?
Self-driving vehicles will require technologies such as steer-by-wire, brake-by-wire and sophisticated onboard computers, which will significantly increase electrical consumption.
Escalating global carbon dioxide regulations are also driving the trend toward electrification. Tough new CO2 emissions standards in Europe and China are about to take effect.
In 2020, the European Union's Euro 6 standard will require a fleet fuel economy equal to 57 mpg, and proposed regulations could push that to 73 mpg by 2030, Eichenberg said.
Automakers plan to meet those targets with a mix of EVs, plug-in hybrids and mild hybrids.