China, which provides 95% of the rare earths used in permanent magnets for high-tech products such as newer, more-efficient electric motors, last week announced the closing of three mines, restricting supply.
FRANKFURT –powertrain engineers were embroiled in debate several years ago when they decided to concentrate on conventional electric motors for electrified vehicles, rather than more-efficient versions based on permanent magnets.
Today, with the price of magnets skyrocketing and China restricting exports of the rare earth metals that electric motors require, “people are congratulating us on our decision,” Bernd Neitzel, executive vice president-electric and hybrid vehicles, tells WardsAuto.
China supplies 95% of the rare earths used in permanent magnets, catalytic converters and other high-tech products, and last week it announced the closing of three mines in part because of environmental concerns.
However, the World Trade Organization last month ruled against China’s rare-earth export restrictions. Some analysts believe the move may have provoked the mine closings, which will have the same effect of restricting supply and further raising prices.
foresaw the problem years ago, Neitzel says, when a consultant warned the company that growing demand for EVs would put pressure on the price of magnets because resources were limited.
was the lone early adapter of Continental’s idea to use less-efficient, less-expensive motors for its electric Kangoo ZE van and Fluence ZE sedan.
However, customers now are knocking at the German supplier’s door. The powertrain division currently has 90 projects under development, and 12 of them use the older-version electric motor. “For sure on electric vehicles, it is the only motor which has a future,” Neitzel says.
Among other things, the motor’s design is modular, which means development costs will be spread over many other vehicles, he says. It can be lengthened for more horsepower and shortened for smaller motors.
However, Continental expects hybrids to far outnumber EVs in 2020, with the possible exception of China.
In the U.S., the supplier foresees 14% hybrids in 2020 against 3% EVs, while Europe will see 20%-25% of its market made up of hybrids, says Jose Avila, president-powertrain division and member of the Continental management board.
China is different because the government is making a strong push for full electrics, says Neitzel, which is putting pressure on the market to “drive consumers to move to EVs.”
Although Continental sees China as a major player in the EV arena, “it is taking them longer to prepare the technology and get it reliable,” Avila says. He does not expect significant volumes to arrive until 2018-2020. “They need some time for preparation.”
For the moment, the powertrain division has three hybrid and EV programs in production: theEV projects; and hybrid versions of the Mercedes-Benz S-Class and 7-Series, for which Continental will provide the power electronics and lithium-ion batteries.
Six other programs are near launch, says Neitzel, mainly power electronics for hybrids coming from “premium European car makers.”
While Continental has 700 engineers working on powertrain-electrification projects, it expects faster growth in its turbocharging business for new downsized internal-combustion engines.
The company decided several years ago to enter the turbocharging business, concentrating at first on 1.0L gasoline-direct-injection motors under development by most major auto makers.
The company’s first turbo, designed to overcome inertia at low-engine revolutions and thus quickly provide boost, is in production for an unnamed major auto maker planning to use it on a global platform.
Now that it is in production, other auto makers are approaching the supplier to bid on engine projects, Avila says.
Continental expects spark-ignition engines to dominate the North American market in 2020, with more than half the cars produced then equipped with direct injection. A few years ago, the technology was rare. Now, the supplier has turbochargers in development for engines up to 2.0L and expects to win business on a 2.3L gasoline engine, Avila says.
In addition to developing turbocharging and direct-injection systems, Continental has developed a fuel-quality sensor that will help an engine controller further optimize efficiency.
Auto makers today are getting about 100 hp per liter from downsized gasoline engines, and Avila says some OEMs are targeting 130-135 hp. He also notes European engines are tuned for increased horsepower, while better torque is the goal in North America.
Outlook for North American Powertrains 2020
Turbocharged gasoline direct injection 23%
Normally aspirated direct injection 23%
Port injection gasoline 32%