The rise of electric car manufacturing in the US
Business Review USA explores the relationship between America and electric vehicles, and whether the industry has the potential to expand
Optimistic experts are making the case that manufacturing in general is enjoying a comeback in the United States. Rising costs of manufacturing in China, coupled with a desire to produce goods near potential consumers, are just some of the many reasons why manufacturing companies are either deciding not to offshore manufacturing plants or move offshore manufacturing plants back to the US. At the same time, others point to the fact that while many companies are returning, others are opting to leave for one or more reasons.
Naturally, general manufacturing trends have an impact on the electric car industry. While many electric cars are still made abroad, current trends and statistics clearly show that this industry is doing better than ever in the States. However, a question that is on many people's minds is whether or not improvement in this sector constitutes a comeback.
The following overview provides a detailed look into electric car manufacturing in the United States, offering a summary of how many and what companies are building electric cars in the country, what the advantages are of doing so, and why current trends indicate that the US has a way to go before it becomes an electric car manufacturing hub.
Electric car makers in the United States
There are currently thirty-five electric car manufacturing companies in the United States. These include large, well known industries such as Tesla Motors, Chrysler LLC and American Honda Motor Co., plus lesser-known companies such as Zap Jonway USA and Electric Vehicles International. California has, by far, more electric car companies than any other state in America, which is not surprising considering the fact that it is also the largest regional market in the country. Other states that are home to two or more electric car manufacturing plants include Indiana, Florida, and Virginia.
Tesla is perhaps the best known electric car manufacturer in the world. While the company has only sold a measly 110,000 electric cars since 2008, its recently-announced Model 3 has already generated over $13 billion in revenue, despite the fact that production will not be completed until 2018. Tesla's image is almost certain to help the company stand out from the competition, even as competitors begin building electric cars that match Tesla's range.
Even so, the number of car manufacturers in the country is quietly growing. Faraday Future released its first electronic concept car in January 2016, and has recently begun building a $1 billion manufacturing plant in Las Vegas, Nevada. The company plans on releasing its first electronic cars for sale to the public in 2018.
Rumors abound that Apple is developing an iCar at the company's Sunnyvale campus. While Apple has not confirmed that it is doing so, Tesla CEO Elon Musk recently stated that it is an "open secret" that Apple is building an electric car. Ford's Don Butler, the executive director of the company's connected vehicle department has stated that he not only believes Apple is building such a vehicle but that he welcomes the company's competition in this field.
Uber recently made waves by announcing that it has opened a facility in Pennsylvania to research the construction of driverless electric cars. It is clear why the company would make such a move; providing such cars to the public would cut costs significantly, thus increasing Uber's bottom line and customer base.
U.S. Government involvement in the electric car industry
U.S. President Barack Obama's interest in energy-efficient products and services is well known. During his term as president, the U.S. Department of Energy has begun offering ATVM loans to qualifying car and car parts manufacturers who needed financial assistance to manufacture energy efficient cars. Both Nissan and Tesla have greatly benefited from this program, as it has enabled both companies to increase electronic car manufacturing and boost sales in the US.
President Obama's EV Everywhere Grand Challenge was launched in 2012 with the goal of bringing together America's best scientists, engineers and businesses with the end goal of drastically lowering the cost of buying electronic vehicles. The DOE is working on ways to significantly improve battery production, enable cars to run further on a single charge, and is researching cost effective materials for the construction of electronic vehicles. The end goal of these initiatives is to help car manufacturing companies build electric cars that are comparable in price to today's gas-powered vehicles by the year 2022.
Is it a comeback?
A growing interest in electric cars, be they regular cars or driverless cars, is likely to increase customer demand. Trends indicate that a growing number of companies are showing an interest in manufacturing electric cars, which could conceivably lead to businesses setting up manufacturing plants in the United States. However, it should be noted that many potentially large electric car manufacturing plants will most likely not be built in the country. Tesla's Elon Musk has already stated that he is considering building a new production plant in Europe. Google, which has been developing electronic driverless cars for several years, has put out job ads for operations managers and other manufacturing related positions; however, many of the listings require that applicants have experience working in Asia, indicating that the tech giant may be planning on manufacturing cars in an Asian country and then importing them into the United States.
Politics, which always has an impact on manufacturing, is currently not helping the electronic car industry. There is still a great deal of political gridlock which, coupled with the uncertainty surrounding the 2016 presidential election, is likely to discourage new manufacturers from starting plants in the United States at this time.
The US has much to offer as a manufacturing hub for electric cars. It has a large number of potential buyers, plenty of professionals for companies to employ, generous incentives from state and local governments, and even assistance from the Federal government. However, there are downsides to building electric cars within the country, and whether or not industry growth in this field will ever turn into a fully-fledged comeback remains to be seen.
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Intelliwave SiteSense boosts APTIM material tracking
“We’ve been engaged with the APTIM team since early 2019 providing SiteSense, our mobile construction SaaS solution, for their maintenance and construction projects, allowing them to track materials and equipment, and manage inventory.
We have been working with the APTIM team to standardize material tracking processes and procedures, ultimately with the goal of reducing the amount of time spent looking for materials. Industry studies show that better management of materials can lead to a 16% increase in craft labour productivity.
Everyone knows construction is one of the oldest industries but it’s one of the least tech driven comparatively. About 95% of Engineering and Construction data captured goes unused, 13% of working hours are spent looking for data and around 30% of companies have applications that don’t integrate.
With APTIM, we’re looking at early risk detection, through predictive analysis and forecasting of material constraints, integrating with the ecosystem of software platforms and reporting on real-time data with a ‘field-first’ focus – through initiatives like the Digital Foreman. The APTIM team has seen great wins in the field, utilising bar-code technology, to check in thousands of material items quickly compared to manual methods.
There are three key areas when it comes to successful Materials Management in the software sector – culture, technology, and vendor engagement.
Given the state of world affairs, access to data needs to be off site via the cloud to support remote working conditions, providing a ‘single source of truth’ accessed by many parties; the tech sector is always growing, so companies need faster and more reliable access to this cloud data; digital supply chain initiatives engage vendors a lot earlier in the process to drive collaboration and to engage with their clients, which gives more assurance as there is more emphasis on automating data capture.
It’s been a challenging period with the pandemic, particularly for the supply chain. Look what happened in the Suez Canal – things can suddenly impact material costs and availability, and you really have to be more efficient to survive and succeed. Virtual system access can solve some issues and you need to look at data access in a wider net.
Solving problems comes down to better visibility, and proactively solving issues with vendors and enabling construction teams to execute their work. The biggest cause of delays is not being able to provide teams with what they need.
On average 2% of materials are lost or re-ordered, which only factors in the material cost, what is not captured is the duplicated effort of procurement, vendor and shipping costs, all of which have an environmental impact.
As things start to stabilise, APTIM continues to utilize SiteSense to boost efficiencies and solve productivity issues proactively. Integrating with 3D/4D modelling is just the precipice of what we can do. Access to data can help you firm up bids to win work, to make better cost estimates, and AI and ML are the next phase, providing an eco-system of tools.
A key focus for Intelliwave and APTIM is to increase the availability of data, whether it’s creating a data warehouse for visualisations or increasing integrations to provide additional value. We want to move to a more of an enterprise usage phase – up to now it’s been project based – so more people can access data in real time.