Ignorance is bliss

Henry Ford sold his first car called a “Quadracycle” in 1896. That marked the beginning of the motor retail industry and for the past 114 years the motor retail industry has remained largely unchanged. The only really significant innovation in the retail motor trade has been the Internet and the changes that it brought to the way we interact with customers. Outside of that, everything has basically stayed the same. The engine has improved and the bodywork and designs have changed over time, but the basics of the industry has remained constant. Until now…

In the next 20 years we are going to see changes that’s going to revolutionize the industry. In the same way that the DVD changed the video industry and the way that the digital camera has changed the film industry, we are going to see radical changes over a short period of time that is going to shock the industry to it’s core. Kodac ignored the impending changes and a giant was reduced to scrap in less than 12 months. The same is going to happen to many of the traditional manufacturers and retailers of motor vehicles globally.

I can see them sitting in their boardrooms, shaking their grey heads and saying; “Wir haben gehört, dass vor”. (We have heard that before)

The reality is that no matter the protestations and denials. No matter the counter arguments, change is inevitable and there is no industry on this planet that is more ripe for change than the automotive industry. It has been the monster driving the oil industry and the destroyer of entire eco systems for too long. The time is right for change. And it’s not just me saying so.

“We know what the dangers are here. We know that our oil addiction is jeopardizing our national security – that we fuel our energy needs by sending $800 million a day to countries that include some of the most despotic, volatile regimes in the world. We know that oil money funds everything from the madrassas that plant the seeds of terror in young minds to the Sunni insurgents that attack our troops in Iraq. It corrupts budding democracies, and gives dictators from Venezuela to Iran the power to freely defy and threaten the international community. It even presents a target for Osama bin Laden, who has told al Qaeda to, “focus your operations on oil, especially in Iraq and the Gulf area, since this will cause [the Americans] to die off on their own.

We know that our oil dependency is jeopardizing our planet as well – that the fossil fuels we burn are setting off a chain of dangerous weather patterns that could condemn future generations to global catastrophe. We see the effects of global climate change in our communities and around the world in record drought, famine, and forest fires. Hurricanes and typhoons are growing in intensity, and rapidly melting ice sheets in Antarctica and Greenland could raise global sea levels high enough to swallow up large portions of every coastal city and town.

And this city knows better than any what our oil addiction is doing to our economy. We are held hostage to the spot oil market – forced to watch our fortunes rise and fall with the changing price of every barrel. Gas prices have risen to record levels, and could hit $4 a gallon in some cities this summer. Here in Detroit, three giants of American industry are hemorrhaging jobs and profits as foreign competitors answer the rising global demand for fuel-efficient cars.

America simply cannot continue on this path. The need to drastically change our energy policy is no longer a debatable proposition. It is not a question of whether, but how; not a question of if, but when. For the sake of our security, our economy, our jobs and our planet, the age of oil must end in our time.” Barack Obama – 7 May 2007

So what’s the revolution I am talking about? It’s electric cars of course. In the next few years they are going to completely replace combustion engines and the days of monster trucks and v8’s will be over.

Tata's $2,500, 59-mpg offering described as "eco-car," on display in January

Welcome to the world’s cheapest car at only $2450, yes the car called the Tata Tiny will be replacing the Tata Nano. The price is amazing at 99,000 Indian Rupees ($ 2,500) and runs on electricity.

This car was developed by Tata International and some of the features on the car are pretty basic but  what do you want for the price? a Rolls Royce? The Tata Tiny can seat 2 people and can be recharged daily at 220 volts through 15 amp sockets, a 8 hour charge enables the cars to travel 80 – 100 kilometers. It may be basic but at that price there is no question that it’s going to become very popular, very fast.

The impact of cars such as the Tiny will have on the motor industry will be fundamental. Today’s large auto manufacturers will not be able to compete with the Chinese and Indian companies. The traditionally dominating manufacturers will go out of business. The cars of the future will be sold from any location, not from the traditional Taj Mahal dealerships. You will be able to buy one at your local grocery store. The cars will be disposable, mass produced and environmentally friendly. The entire motor industry will be re-engineered through this revolution.

So, the grey heads in the swanky boardrooms can shake their heads as much as they like. They are about to become extinct. They are as much aware of that fact as the dinosaurs were.

Marthinus Strydom

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