The Strategic Planning Summit in Southfield, Friday 18th September, addressed whether changes in the extraction of natural gas could have a massive impact upon the automotive industry. Mustafa Mohatarem, chief economist of General Motors, highlighted the fact that the US natural gas supply is estimated to amount to around 100 years’ worth. He’s hedging his bets that natural gas as a transportation fuel will be “the next big thing”.
The cost of gasoline is significantly higher than natural gas, so this is definitely a selling point which makes it an attractive transportation fuel. People are likely to find ways of using it.
Managing director of investment banking at Guggenheim Partners, John Casea, is supportive of Mustafa Mohatarem’s proposal.
Although John Casea agreed with Mohatarem, he suggested that the prognosis was not so straightforward. Future developments in EV’s will be a deciding factor in whether natural gas will become a popular transportation fuel.
If pure electric vehicles (EV’s) are to break through the market, it will probably be driven by changes in government policies in either the US or China. Much will depend on whether the major automotive companies refine and perfect this technology. Challenges such as battery range, charging times and price are the biggest challenges currently facing electric vehicles.
Mohatarem was adamant that we will also see an emergence of major auto manufacturers in China, India and even Russia within a couple of decades. He predicts that alongside natural gas powered vehicles, this will be another major trend.
Will we start seeing an increase in auto manufactures producing natural gas fuelled cars for the US? With many technologies such as EV’s, diesel-hybrids and electric-hybrids in development, we will have to wait and see.