Survey results from auto industry executives reveal a strong focus on enhancing internal combustion engines rather than prioritizing electric vehicle development. Despite the growing popularity of electric cars, traditional engines are still seen as the more viable investment for the near future.
A recent survey by KPMG reveals that auto executives are prioritizing improvements in internal combustion engines over electric vehicles. Despite the surge in electric vehicle sales, traditional engines are expected to dominate the market for the next decade. This article delves into the reasons behind this trend, the investments being made, and the future outlook for both technologies.
According to an annual survey conducted by KPMG, a leading audit, tax, and advisory firm, a significant majority of auto executives believe that internal combustion engines (ICEs) will continue to be the primary focus for investment. The survey, which included responses from executives at some of the world's largest automakers, revealed that 75% of respondents see more potential in refining ICEs for greater efficiency and reduced carbon emissions than in developing electric vehicles (EVs).
Despite the tripling of EV sales over the past year, electric vehicles are projected to hold only a 15% share of the global car market for the next 12 years (source: IEA). This has led many automakers to continue focusing on traditional engines. For instance, Ford's EcoBoost engine, which is now featured in nearly every model in their lineup, exemplifies the ongoing advancements in ICE technology.
Gary Silberg, KPMG’s National Automotive Industry leader, stated, "When you look at current MPG estimates for new cars, it's very evident that automakers are continuing to significantly improve engine efficiency. What's clear is that the internal combustion engine is not going anywhere soon."
The survey also highlighted a willingness among executives to invest in manufacturing plants. With many plants already operating at full capacity, 64% of respondents indicated plans to increase investments in new facilities over the next five years. This is a notable increase from the 55% who expressed similar intentions the previous year.
When combined with modern accident avoidance technologies, fuel-efficient and environmentally friendly ICEs offer a safer and more reliable option compared to their electric counterparts. Until EVs can demonstrate greater range and safety, the practical investment remains in the development of ICEs.
In the survey, executives were also asked which companies they believed would dominate the market over the next five years. Volkswagen, Hyundai, and BMW emerged as the favorites, each focusing on developing smaller and more efficient ICEs rather than solely investing in electric power.
While the future of electric vehicles remains promising, the current focus for many automakers is on refining internal combustion engines. With significant investments in both engine technology and manufacturing processes, ICEs are set to remain a dominant force in the automotive industry for the foreseeable future.
For more insights on the future of automotive technology, visit KPMG's Automotive Industry page.
This article was crafted using data and insights from reputable sources, including KPMG and the International Energy Agency (IEA). For further reading, explore the Global EV Outlook 2021 by the IEA.
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