Yahoo Finance EVs and gas-powered cars need to 'coexist:' Hitachi America CEO
Before America sees more widespread adoption of electric vehicles (EVs), there will need to be a period in which EVs and gas-powered cars “coexist,” Hicham Abdessamad, chairman and CEO of Hitachi America, told Yahoo Finance.
Globally, EVs will dominate vehicle sales across bus, car fleet, and light commercial vehicle segments within 15 years, according to Hitachi, but the transition will take longer in the U.S.
“We also know that we're not going to transition to EV 100 percent [immediately],” Abdessamad said. “It’s going to be a 20- to 30-year journey. And we're going to have a world that's got EV and non-EV all sort of coexisting together,” he said.
Hitachi America, Ltd., a company of the Hitachi Group in which Hitachi, Ltd. (HTHIY) serves as the parent organization, established its first American office in New York in 1948. Fiscal 2020 revenue in North America (U.S. and Canada) comprised 13% of Hitachi’s total revenue, equating an amount of over $10 billion. Its business segments include IT, energy, industry, mobility, smart life, and automotive systems.
Abdessamad, who was appointed CEO this past May, spoke with Yahoo Finance to discuss Hitachi’s work in EV technologies and infrastructure, the implications of EVs on transportation and energy, as well as Hitachi’s partnership with Tavistock Development Company in their development of the smart city of Lake Nona, Florida. Lake Nona is one of the fastest growing communities in America and has the country’s largest and longest-running, single-site autonomous vehicle fleet serving the community, a growing 5G network,* and multiple Fortune 500 businesses.
The company recently launched its Hitachi ABB Power Grids systems that will allow for large-scale e-Mobility. The EV charging systems will allow operators to “efficiently scale up their operations and is expected to contribute to sustainable society for millions living in urban areas,” according to Hitachi’s website.
“What [Hitachi ABB Power Grids] brings us is the element of grid management and energy management energy distribution,” Abdessamad said. “It also gives us an aspect of mixing renewable non renewables and sort of balancing that out for optimal costs and clean energy.”
Though these new charging technologies may bring more cost-effective and accessible charging solutions for EVs operating in urban environments, in order for EVs to make economic sense as well as have an environmental impact, the entire ecosystem needs to be balanced. If too many vehicles are plugged in to be charged at a given time without proper power grid management, the impact would be “significant,” Abdessamad said.
EVs as a service
As for the smart city of Lake Nona, the data collected from studying the movement patterns of people and vehicles in the “living lab” may have big implications for larger urban environments in the future. For Hitachi, the goal is to ensure “frictionless” mobility around the city among pedestrians, bicycles, and vehicles. And in addition to understanding traffic, Abdessamad said that Lake Nona has allowed for better insight into how “EVs as a service” will function and scale up in the future.
“It's very experimental, [there’s] a couple things we've learned,” Abdessamad said. “One is that we are using drone technology as a 3D or multi-dimensional sensor, in addition to all the instrumentation on Lake Nona, to understand traffic in a better way.”
In integrating autonomous EV fleets within urban public transportation systems, Abdessamad believes that the most logical path forward would be a push for electrification. According to him, light commercial vehicles present a big opportunity for EVs to make a breakthrough.
“A lot of people talk about EVs when it comes to your private cars like a Tesla (TSLA) but commercial vehicles, like I mentioned before, are primed for electrification because they don't need that long range,” Abdessamad said. “If you look it up, a school bus, regular bus, or even even a courier like a UPS/FedEx (UPS/FDX) truck—you kind of know what the routes are, it's probably sub-200 miles per day [with] a lot of stops.
However, Abdessamad said, it's currently not economically feasible for many vehicle fleet operators to adopt entirely electric fleets. He spoke to the role of government in sparking further adoption, and sees “plans for major investments and infrastructure” on the horizon for the EV industry.
Finally, as the global microchip shortage continues to cause supply chain disruptions and send ripples across countless industries, Abdessamad commented on the future of the EV industry in lieu of an increasing world dependency on semiconductors.
“If we have this problem ten years from now, when we are more reliant on technology and more sophisticated EV cars, it'll be a big challenge. I think people will feel it,” Abdessamad said. “So I think I'm glad that we're having this challenge today [in order to come up with solutions].”
*Note: Verizon, Yahoo Finance's parent company, provides 5G wireless service to residents and workers of Lake Nona, FL.
Thomas Hum is a writer at Yahoo Finance. Follow him on Twitter: @thomashumTV
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