Karl Benz is most often identified as the man who invented the car – but actually the origins of the car can be traced all the way back to around 3,000 BC, when the first carriage was invented in Mesopotamia. The residents of Mesopotamia – modern-day Iraq and Kuwait – rather sensibly decided that it would be far easier to get a horse to move loads (instead of doing it themselves).

The carriage industry continued until the beginning of the 20th century, when a basic carriage could be acquired for as little as $20. According to The Carriage Trade: Making Horse-Drawn Vehicles in America by Thomas Kinney, more than 4,600 carriage companies were operating in the United States by the early 1900s.

Why am I delving into history? Because looking at what happened in history can sometimes help us understand what will happen in the future. Some of the carriage companies were enormously successful. And how many do you think are around now?

Some of those 4,600 carriage companies – Studebaker, for example – retooled its production to manufacture cars. The rest simply faded into oblivion.

That’s precisely what could happen again – because the car as we know it now won’t be around for much longer. And, no doubt, the same will be said of some of the companies that produce them.

This is because massive change is coming and indeed so many question marks hang over the automotive industry. Just some include: when will we finally see the death of the internal combustion engine? Does the future belong exclusively to electric vehicles (EVs)? What about autonomous driving? Artificial intelligence? Connectivity (as cars connect and “talk” to everything in and around them they are producing millions of kilometres of data)? What will happen to the retail environment? Will bricks and mortar car dealerships disappear?

Right now, while all those issues are being addressed at the highest possible level within car companies, there is one massive area of emphasis: e-mobility. And many captains of industry are proclaiming that “EVs are the future”.

Maybe. But EVs aren’t without their challenges. One of the greatest challenges – especially in third-world countries such as South Africa – is that the electricity powering them is dirty. Another challenge in South Africa, of course, is load shedding. It’s somewhat off-putting to own an EV that cannot be charged.

There are other challenges that don’t just impact South Africa – and one is the escalating price of lithium. According to Nature journal, as the lightest metal on the periodic table, and the one most eager to shed its electrons, lithium is the ideal element to make powerful batteries. It can do the most work with the least mass and the fewest chemical complications.

But there is the issue of price. “A year ago, we paid €7 000 for a kilogram. Today it is €70 000,” one bus industry executive, who doesn’t want to be named, told us.
These figures are confirmed by The Guardian. “Lithium prices have ‘gone ballistic’ as surging EV sales worldwide create massive demand for the critical component of lithium-ion batteries. According to figures from Benchmark Mineral Intelligence (BMI), the price of the lithium-rich raw material spodumene rose 478.3% between January 2021 and January 2022. In January alone the price of spodumene jumped 45.5% to US$2,400 a tonne, up from $1,650 in December. Similar price rises were recorded for lithium carbonate and hydroxide – refined lithium at different stages of purity – over the past year,” it reports.
Lithium isn’t the only problem child keeping EV manufacturers awake at night.
Rare earth metals – used to produce permanent magnets mostly made of neodymium that power electric engines – are an issue too. Rare earth metals are a bit of a misnomer; they’re not actually rare. However, they can be dirty, difficult and economically challenging to mine. A whopping 80% of the rare earth magnets come from China, and there are many question marks around the reliability of supply and the stability of pricing.

According to Reuters, rare earth magnets give EVs a real advantage over those without them. “Electric cars with rare earth magnets require less battery power than those with ordinary magnets, so vehicles can go longer distances before recharging. They were the no-brainer choice for EV motors until about 2010 when China threatened to cut rare earth supply during a dispute with Japan. Prices boomed,” the news agency reports.

Prices continue to skyrocket, which is significant, given the fact that the permanent magnets in hybrid and EV motors cost up to half that of the motor. For instance, the price of neodymium – the most popular rare earth metal used in the production of EV magnets – rose by 260% from May 2020 to May 2021.

Pricing is one thing; EV producers can simply raise the prices of their cars to cover increased input costs. The bigger picture is the environmental cost of the manufacturing of batteries for EVs. There is massive concern over the social and environmental impacts of the mining of all of the minerals involved in battery production.

We’re talking a lot of mining here; according to the Global Battery Alliance – a public-private collaboration platform founded in 2017 at the World Economic Forum to help establish a sustainable battery value chain by 2030 – the volume of raw material extraction by 2030 will be greater than 300 Great Pyramids of Giza per year, while the required refinery weight will exceed 110,000 Boeing 787 Dreamliners per year. How will car producers overcome this challenge? Recycling could be a solution – and some experts say it will soon be cheaper to recycle the raw materials needed in battery production than to mine them from the ground.

Then there is the manufacturing of the actual EVs – which raises some more questions. After all, as Investment Monitor points out, while EVs on the road have a net-negative impact on carbon emissions, their production is carbon intensive. “Research from Berylls Strategy Advisors found that the manufacture of an electric car battery weighing 500 kg emits 74% more carbon dioxide than producing a conventional car in Germany,” it reveals. Clearly, just churning out EVs isn’t enough to save the planet; car manufacturers need to reduce and ultimately eliminate CO2 emissions from cradle to grave.

But then of course comes the question: will those car companies actually be manufacturing cars in future? Maybe. Maybe not.

In the not-too-distant future, car ownership could become as widespread as carriage ownership. That’s because we won’t want cars. We will want mobility – and that’s a completely different thing.

Instead of going to our garage and hopping into our car, we will summons an autonomous pod – which will transport us safely to our destination. Companies such as Volkswagen are mindful of this trend. It has already launched a new group strategy entitled “NEW AUTO – Mobility for Generations to Come”. In terms of this strategy, the company will morph from a vehicle manufacturer to “a leading, global software-driven mobility provider”.

The advent of the driverless pod comes with even more questions. Will you care which brand of pod is transporting you? After all, if you’re taking the bus – do you first check and see which company has manufactured the vehicle before hopping aboard? This has significant marketing connotations.

While questions abound, there are also some positive connotations of the mobility via pod scenario. The price of fuel will be irrelevant (we hope and pray that the people working at the 4 600 service stations in South Africa will have found other employment). We will no longer care about the state of roads in South Africa – because our pod may well be airborne (that takes care of our worries surrounding toll fees too). We also won’t bother about all the hassles involved in renewing our car or driver’s licence. Unless we’re classic car collectors, we won’t need these – since we won’t be owning cars or driving.

But the connotations for car manufacturers may not necessarily be as positive. Could they share the same destiny as carriage makers? Anything is possible.