Electric cars: However we got here, the road ahead looks enticing

Electric cars: However we got here, the road ahead looks enticing

Published By Alex Driver

23/11/2017 17:03:15

Within two weeks of Tesla announcing that it was applying an open source philosophy to its electric car patent portfolio back in 2014, its share price had increased by almost 20%. In effect, the company had unilaterally decided to let others use a substantial portion of its intellectual property, for free. The investor response appears to have been well judged – earlier this year the share price was almost double its 2014 levels.

Several carmakers, such as Ford and BMW, have since followed similar paths in adopting a more open and collaborative approach to their electric vehicle licensing strategies. It is of course impossible to establish the effect this alone has had on developments within the electric car industry. Proponents of this behaviour might say that it was necessary to encourage breakthroughs, efficiencies and cost savings in an industry which would inevitably be too big for one company alone to master. Opponents might argue that the very existence of companies willing to litigate their patents forces others to produce “workarounds” and in doing so the development of different platforms is encouraged - healthy competition would ensure that the “best” technologies win out in the end, they might say.

In any event, the debate might be of less significance now than when Tesla made its announcement. The fact is that electric cars are now playing an important role on the world stage. UBS estimates that by 2025 30% of new car sales in Europe will be electrically powered (either plug in hybrid or battery-electric), compared to 1.1% in 2016. They predict that cost parity between electric vehicles and combustion vehicles could be reached next year. In the UK by 2040 there could be a complete ban on the sale of new petrol or diesel cars. Car manufacturers are planning accordingly. It may be the case, therefore, that legislation and market forces are the real drivers for change.

What is clear is that, as with many new industries, associated fields crop up and the new tech in these fields deserves protection. Tesla, for example, has recently been granted a US patent for a method of replacing (rather than recharging) a battery in an electric vehicle in “less than 15 minutes”. Amazon has also last month obtained a US patent to a system for recharging an electric vehicle using a drone that can be dispatched to a vehicle low on range. The spirit of collaboration may have helped us to get this far but there are still a lot of players jostling for position, and with that they bring exciting possibilities.