As you might expect, the future of the auto industry and how it will play into the ever burgeoning environmental agenda is undoubtedly one of the new millennium’s hot button topics. Given that many nations around the globe have been committing to drastically reducing their emissions in the next few years and the growing demand of consumers that society relinquish its dependence on fossil fuels, each and every automaker out there is feeling the pressure to bolster their EV powered options.
No longer considered products of mere curiosity or whimsy, electric vehicles are quickly becoming a staple in many a brand’s fleet – though admittedly, the technology that drives them is still in its infancy. So much so that some of the industry’s lower-tiered brands have yet to enter the electric vehicle game (for a variety of reasons to be sure, but we’d wager that the cost of developing this technology alone poses the greatest barrier of entry to the market).
One might think that automakers that have already begun developing the technology would surely enjoy an advantage over competitors who didn’t recognize the shifting economic landscape. So why then are some automakers like Ford, Tesla, and Toyota willingly handing over this revolutionary technology to anyone with an outstretched hand?
Why Ford is Licensing Thousands of Patents
The act of licensing out patents in the automotive industry in and of itself is nothing new; Ford itself licensed technology from Toyota in order to develop its first Ford Escape hybrid.
Now you might be wondering where the sense lies in handing over proprietary information to a competitor for use towards their own gains. Admittedly, this notion does sound counter intuitive; by providing technology to someone else, one might come to the conclusion that the only outcome would be lost sales opportunities.
Granted, that’s a valid initial reaction to the whole thing, but it doesn’t take a great deal of business acumen to understand why automakers like Ford would want to share their technology with others.
In a nutshell, by bringing more automakers to the electric and hybrid vehicle table, several things occur. The first, is that it increases competition. Increased competition always leads to advances in innovation. The more competitors, the harder each one is going to work to develop their product and get it to market first (which means more capital being invested in things like research and development). Increased competition also means more options become available for the consumer.
Furthermore, increased competition helps to reduce the manufacturing costs of emerging technologies, which in turn makes owning a hybrid or electric vehicle more affordable to the end user.
While some automakers may opt to share their intellectual property free of charge, the Blue Oval is taking another approach. In 2014, the Detroit automaker filed nearly 2500 patents with nearly 400 of them directly related to hybrid and EV systems. While not free, Ford is offering them for sale through a non-profit organization that it helped to co-found: the AutoHarvest Foundation.
The mandate of the foundation is to act as “the world’s only truly neutral and global on-line meeting place for innovators of all types to showcase technologies.” Essentially, the foundation was formed to acknowledge the idea that collaboration within industries is vital to the growth and development of the industry itself.
While it does make one feel good to think that direct competitors see the benefit of working together, there’s no denying that they all have a vested interest in collaborating in the development of technology.
The advent of the Zero Emission Vehicles (ZEV) requirements (an initiative that began in the state of California) has been adding pressure to the industry to meet certain thresholds. And while ZEV requirements are currently only relegated to a handful of states, it won’t be long before similar regulations pass into law in many more jurisdictions. Currently, at least in California, the regulations state that any manufacturer that sells more than 60,000 units annually in the state, a minimum of 14% (nearly 8,500) of those must meet ZEV requirements.
While these types of regulations are necessary to help governments reach their carbon emission goals, they also act as a sort of “forced incentive” for automakers to aggressively push the boundaries of technology – just remember that the next time you’re checking out the latest offerings at your local Ford dealer.