How Much Oil is in an Electric Vehicle?
When most people think about oil and natural gas, the first thing that comes to mind is the gas in the tank of their car. But there is actually much more to oil’s role, than meets the eye…
Oil, along with natural gas, has hundreds of different uses in a modern vehicle through petrochemicals.
Today’s infographic comes to us from American Fuel & Petrochemicals Manufacturers, and covers why oil is a critical material in making the EV revolution possible.
It turns out the many everyday materials we rely on from synthetic rubber to plastics to lubricants all come from petrochemicals.
The use of various polymers and plastics has several advantages for manufacturers and consumers:
- Easy to Shape
- Flame Retardant
Today, plastics can make up to 50% of a vehicle’s volume but only 10% of its weight. These plastics can be as strong as steel, but light enough to save on fuel and still maintain structural integrity.
This was not always the case, as oil’s use has evolved and grown over time.
Not Your Granddaddy’s Caddy
Plastics were not always a critical material in auto manufacturing industry, but over time plastics such as polypropylene and polyurethane became indispensable in the production of cars.
Rolls Royce was one of the first car manufacturers to boast about the use of plastics in its car interior. Over time, plastics have evolved into a critical material for reducing the overall weight of vehicles, allowing for more power and conveniences.
Rolls Royce uses phenol formaldehyde resin in its car interiors
Henry Ford experiments with an “all-plastic” car
About 20 lbs. of plastics is used in the average car
Manufacturers begin using plastic for interior decorations
Headlights, bumpers, fenders and tailgates become plastic
Engineered polymers first appear in semi-structural parts of the vehicle
The average car uses over 1000 plastic parts
Electric Dreams: Petrochemicals for EV Innovation
Plastics and other materials made using petrochemicals make vehicles more efficient by reducing a vehicle’s weight, and this comes at a very reasonable cost.
For every 10% in weight reduction, the fuel economy of a car improves roughly 5% to 7%. EV’s need to achieve weight reductions because the battery packs that power them can weigh over 1000 lbs, requiring more power.
Today, plastics and polymers are used for hundreds of individual parts in an electric vehicle.
Oil and the EV Future
Oil is most known as a source of fuel, but petrochemicals also have many other useful physical properties.
In fact, petrochemicals will play a critical role in the mass adoption of electric vehicles by reducing their weight and improving their ranges and efficiency. In According to IHS Chemical, the average car will use 775 lbs of plastic by 2020.
Although it seems counterintuitive, petrochemicals derived from oil and natural gas make the major advancements by today’s EVs possible – and the continued use of petrochemicals will mean that both EVS and traditional vehicles will become even lighter, faster, and more efficient.
Prediction Consensus: What the Experts See Coming in 2023
Using our database of 500+ predictions from reports, articles, interviews, and more, we highlight what experts think will happen in 2023
Prediction Consensus: What the Experts See Coming in 2023
In this, our fourth year of Prediction Consensus (now part of our more comprehensive 2023 Global Forecast Series), we’ve learned a few things about the universe of predictions, experts, outlooks, and forecasts.
- Experts are reasonably good at predicting the future one year out, though they are also in a strong position to help shape the future through their influential thought leadership and actions.
- Situations can and will flare up in unexpected ways, which can have knock-on effects on the whole system (e.g. COVID-19, Ukraine invasion).
- Experts are just as susceptible to hype as the rest of us, as evidenced by the glut of Web3 predictions in 2022 and AI predictions this year.
Of course, we’re susceptible to hype as well, which is why we asked ChatGPT to write the intro to this article:
Not bad. But, simple curiosity aside, it’s the practical considerations we’ll focus on today. This article serves as an overview of how experts think the markets will move, how trends will develop, and which risks and opportunities to watch over the coming 12 months.
Let’s gaze into the crystal ball.
The Economic Vibe Check
First, we’ll look at some big picture themes, and how experts see them playing out over 2023.
Inflation: This was the top economic story of last year, so it’s a natural starting place. Many of the expert opinions in this year’s database (now at 500+ predictions) are pointing to inflation easing off as the year progresses*. On the downside, few predict that inflation will drop back down to the 2% range that Fed policymakers favor.
GDP: Forecasters have been revising their economic projections downward in recent weeks. The latest was World Bank, which now sees global growth declining to 1.7% in 2023, down from 3% just six months ago. Most of the predictions in our database see global economic growth in the range of 1.5% to 2%.
Recession: As 2022 came to a close, the broad sentiment among experts in the financial industry is that recession is all but inevitable in developed markets this year. As dawn breaks in 2023, a few analysts now feel that the U.S.—and possibly Europe—could narrowly avoid recession.
Markets: Experts on Wall Street and beyond are cautiously optimistic about equities, and after the worst year on record for bonds in 2022, most analysts are declaring that “Bonds are back”.
*Interestingly, this was also last year’s prediction, but the scale of Russia’s invasion of Ukraine was a curve ball that caught many experts off guard.
AI is Eating the World
Jobs being displaced by automation is far from a new theme, but given the exponential improvements in AI in recent years, the risk to entire industries feels more existential today.
As an example, let’s consider art and design. One of the ways many illustrators and artists earn a living is through commissions—essentially being hired and paid to create a specific piece of art in their style.
Today though, free, powerful AI tools, such as Midjourney, allow users to generate high-quality art in an infinite number of styles with just a few clicks. Real art will never truly go out of style, and accomplished artists will always attract an audience, but this one example shows how quickly technology can disrupt an industry. (Artists can take solace in the fact that AI is still comically bad at rendering hands.)
Of course, there are obvious positive aspects to this technological advancement as well. Generative AI tools are useful for generating ideas and mock-ups, and even functional snippets of code. AI systems like AlphaFold unlock a world of possibilities in scientific domains.
From the hundreds of predictions we evaluated, it’s clear that experts view AI as a major catalyst this year. AI start-ups are forcing Big Tech to innovate faster, and employees are finding new ways to use AI-powered tools to increase productivity.
Experts predict that AI will impact peoples’ lives in a much more visible and tangible way in 2023 than in past years.
The China Factor
As world’s second largest economy and linchpin of global trade, events in China have a major impact on the world economy.
Xi Jinping’s reversal of Zero-COVID restrictions should drastically change the trajectory of the country’s economy. For one, reopening will unleash a flood of household spending and consumption.
China’s reopening will also impact other economies as well. For example, the resumption of travel will be a boon to destinations favored by Chinese vacationers. Economically, Hong Kong stands to benefit immensely—its GDP could jump upwards of 8% after reopening is complete. Emerging market commodity exporters could see a lift as well, though inflation could be reinvigorated as a result.
In the U.S., a storm is brewing over the extremely popular video app, TikTok. Many experts predict that regulators will either ban the app altogether in 2023, or force the sale of the company to an American entity. Regardless how that situation plays out, it underscores the souring relationship between the U.S. and China. The rivalry will continue to have ripple effects on the global markets throughout the year.
Energy was the S&P 500’s top performing sector two years in a row, and many experts feel that more growth is on the horizon.
The global system that supplies us with energy is breathtakingly complex, with a lot of unpredictable factors at play. Of all factors, conflict can create the most volatility, and 2023 has a number of geopolitical risks that could impact energy supplies. First, Europe will continue to diversify its energy imports away from Russia. Recently, liquefied natural gas from the U.S. has helped fill gaps.
Next, Iran could be a flashpoint in the Middle East this year. A brewing conflict in the region could cause instability, which will have knock-on effects on the energy industry—particularly in the event of attacks on oil and gas infrastructure.
Here are a few other factors to consider this coming year:
- The U.S. Energy Department will aim to replenish its Strategic Petroleum Reserve
- Easing of U.S. sanctions on Venezuela could lay the ground work for increased oil production
- In post-Zero-COVID China, economic activity will increase, pushing up demand
- In the UK, the energy price guarantee will rise in April, meaning higher energy bills for households
The Elon Playbook
After a lull in December (nobody wants to be the company that fires people during the holiday season) tech and tech-adjacent companies have resumed their zealous slashing of headcounts.
There had been a slew of layoffs already in 2023, topped by Salesforce, which is trimming 7,000 jobs, and Amazon, which is cutting 18,000 roles—primarily impacting the corporate side of the business.
Given the influence of Elon Musk in the tech industry, many experts are suggesting that his strategy of ruthlessly slashing headcount at Twitter might serve as inspiration for other technology leaders.
Employees in the tech industry are very well compensated, and many were hired during periods of intense competition between companies to attract talent and capture market share.
During a downturn, it’s tempting—and often necessary—for companies to course-correct. There were also predictions that the whole start-up and investment ecosystem could be switching from a hypergrowth to a value-focused mindset, which is a theme that is worth consideration in 2023.
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