Northwood University Professor Timothy G. Nash will be among the expert speakers at the Automotive Aftermarket Products Expo (AAPEX) in Las Vegas as he takes part in conducting a Nov. 4 seminar entitled Aftermarket Dynamics and the Road Ahead: 2015.
With the industry expected to post an annual growth rate of 3.4 percent through 2017, “This session will assess current aftermarket trends, economic factors influencing consumer spending, shifts in demographics, and how the interplay of these forces most likely will influence the aftermarket in the next three to five years,” Nash says.
Attendees will learn:
• What the aftermarket data is telling us about today’s business.
• How certain economic factors are influencing consumer spending.
• What evolving demographics could mean to the industry’s future.
• How industry leaders can use these data to anticipate trends in tomorrow’s business.
Nash recently answered a series of questions from Aftermarket Business World about the prospects for alternative fueling systems:
Q: How well is the aftermarket prepared to embrace the repair and maintenance procedures for any given alternative propulsion system?
A: Generally speaking, this question begs for a free market answer. The beauty of the aftermarket is that it is well suited to adapt to whatever the market throws at it if it is profitable to do so.
Q: How would you rate the ongoing pattern of acceptance for electric vehicles? Is a network of charging stations and EVs something that the industry should be preparing for in earnest?
A: Certainly there are more and more electric vehicles on the road. From an aftermarket perspective, we are less concerned about charging stations and more concerned about the readiness of aftermarket service dealers to provide the service and repair of these vehicles. Is the aftermarket distribution channel prepared to source and stock a new range of products? Are technicians trained to service these vehicles? The last thing the aftermarket wants is for the motoring public to take their electric vehicles to the dealer because the aftermarket cannot service these vehicles.
Q: Do you think the industry and motoring public will ever fully accept a substitute for fossil fuels?
A: Absolutely! The U.S. carbon footprint has declined in recent years largely due to better technology and the realization that pollution at its core is waste and inefficiency. LED lighting sales are skyrocketing because they provide more candle power and cost a fraction to operate relative to their predecessors. The same type of breakthrough innovation needs to drive alternative fuels and sales will follow. We have no doubt that entrepreneurs will make this happen within 10 to 15 years.
Q: Implementation of alternative fuel sources tends to be hampered by the “chicken or egg” issue. OEMs are reluctant to produce mass quantities of vehicles that people are reluctant to buy because fueling stations are scant, and fuel providers are reluctant to construct filling/charging facilities because they may have a paucity of people using them. What can be done to remedy this situation?
A: In the early- to mid-1800s the primary mode of transportation in the U.S. was the horse and buggy/wagon or the canal. Major inventions from the train to the automobile were initially opposed or deemed unsafe. Once they gained acceptance, roads, fueling stations, train stations, tracks, etc. emerged over time, not overnight. A successful market-driven technology will be the catalyst to wide-scale use of alternative fuels and logical government policy and partnerships – just as it was with the automobile and the train.
Q: Numerous alternative fuels are being developed; is there any one system that stands out as being both practical and acceptable to mainstream motorists?
A: According to the 2014 U.S. Annual Energy Outlook, there were just under 14 million alternative fuel vehicles on U.S. highways out of roughly 253 million in 2012, or 5.4 percent of all vehicles on the road. This is good progress over the last decade, yet data indicates growth is slowing as it has been driven by government subsidies and/or tax incentives, which often come into question during challenging economic times and the political philosophy of the U.S. Congress and/or White House.
Q: How would you assess the nation’s willingness to wean itself off fossil fuels? Do you anticipate significant strides regarding this within the decade or so?
A: The market is not purchasing alternative fuel vehicles in mass quantities because the prices of said vehicles are too high relative to pure fossil fuel powered vehicles. The U.S. should not increase fuel taxes on gasoline to drive people to purchase higher priced alternative fuel vehicles and take highly subsidized public transportation in the U.S. like is done in Europe, as most Americans do not have, nor want, such a system as it limits freedom of mobility and job opportunity outside of major urban areas.
Also, high taxes on fuel disproportionately limit a poor person’s ability to purchase a car and their mobility. Competition, investors and innovation must make these technologies and alternative fuels more affordable.
Q: How do you rate the near-term prospect of success for ethanol?
A: Eighty-two percent of the alternative fuel vehicles are powered by engines that can run on gasoline or a gasoline/ethanol blend called E85; most owners do not use E85 fuel. Eighteen percent are hybrid gasoline, natural gas, hydrogen, diesel and/or electric vehicles. As you can see, the true percent of the U.S. market embracing alternative fuels today is well below 5 percent, yet ethanol is the clear leader.
Q: Audi, Joule and Global Bioenergies are working on a synthetic e-fuel that involves microorganisms using water (brackish, salt or wastewater), sunlight and carbon dioxide to produce high-purity fuels. At this point, how would you assess the practicality and timeframe of e-fuels replacing fossil fuels?
A: It is impossible to say. The replacement of something as well established as fossil fuels will take more than just a good idea. There are many, many other things to take into consideration beyond the technology. We are not specifically aware of these technologies, and they certainly are not the first attempts at replacing fossil fuels. From an aftermarket perspective, we are a reactive industry and we will accommodate whatever technologies the OEMs throw our way. The switch from R-12 to R-134a refrigerant comes to mind.
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