Power and Influnence

Part Three

For the eco-conscious consumer, an electric car can be an attractive alternative to traditional fossil fuel burning vehicles.  According to fueleconomy.gov, electric cars are capable of converting 3 times the energy from the motor to the wheels over their gas-guzzling cousins, they emit no pollutants, though the plant producing the electricity might, they perform with greater pickup with less noise, and their energy source is completely domestic.  As production and battery pack costs drop, sales of EV (electric vehicles) are expected to rapidly increase in the next decade.

There is, however, another consideration GM will have to make when planning the future of the Volt and possible additional lines.  Tech savvy consumers are always looking for the next innovative product in their phones, small electronics, and cars.  As communication technologies advance, the automobile industry will look for ways to appeal to their consumers.  Cars speaking with other and with the roadway will allow vehicles to predict traffic patterns and possible threats miles down the road as well as in the next lane.  A study by The McKinsey Global Institute predicts the auto industry will be the second largest data producer by 2015.  Much of the data will come from the car itself through sensors and integrated data.  Additional data will be used by occupants accessing third-party sources like weather, sports, and traffic reports.  Future generations of “smart cars” are predicted to use current driver assist technology to actually become fully driverless.

         The law of diminishing marginal  productivity tells us that GM cannot continue to increase one input (EV technology) while keeping others (other technological innovations) at the same level and expect  to remain relevant in a competitive market.  Over time their sales of electric vehicles will slow and eventually stop altogether if they fail to pursue other inputs which can be added to the EVs to keep output (sales) strong.

References:

Today's Vehicles Are High Tech Devices on Wheels. (2013). Retrieved from http://www.autoalliance.org/index.cfm?objectid=1D64C240-7EE5-11E3-9303000C296BA163