Plans brewing for Australian gigafactory and A-EV manufacture

A new company headed up by the former head of climate change at PwC Australia has revealed plans to mass-produce autonomous electric vehicles, and potentially build a battery gigafactory, on Australian soil within just a few years.

The ambitious plans were revealed on Monday by Michael Molitor – the CEO at A-EV start-up A2emCo who, as well as an impressive academic record has notched up 18 years in the private sector at BP, McKinsey and the OECD.

Speaking at the Innovation in the Energy Sector conference co-hosted by RenewEconomy in Sydney on Monday, Molitor said A2emCo aimed to be rolling out almost completely Australian made, level 5 autonomous vehicles by 2020.

“(Level 5) means, you’ve got an app on your phone, you subscribe to the service, the car shows up to your house, or your apartment, there’s a cyber security system that IDs you, the door opens and says ‘good morning’ …the door closes, you’ve got 5G connectivity, it says you’re going to be in the office in the CBD in 17 minutes.”

But before you scoff, he also concedes that in 2020 the cars’ autonomy function will not be switched on; the timing of that will depend on the timing of the switched on consumer, and of course when the regulatory framework is ready.

So the car that rolls off the line in 2019-20, will be an EV, Molitor says – “a super sophisticated EV.”

“Our vehicle is already designed, it’s in prototype, we’re building six evaluation prototypes … they’re not being built in Australia, for a variety of reasons, but we will be moving production here,” he said.

“We’re looking at Q4 2019, Q1 2020, we’ll have vehicles on the road in Australia. And we like to under-promise and over deliver, so it may be better than that.”

And to power these super-sophistocated EVs, Molitor says his company is also looking at building Australia’s own energy storage giga-factory, such as is currently being completed in the US, by Elon Musk’s Tesla.

Indeed, he says A2emCo has already consulted with Peter Carlsson, Tesla’s former Tesla head of operations who built the gigafactory in Nevada, and is now building a gigafactory in Sweden.

According to Carlsson’s own estimations, Molitor told the conference, to meet soaring global battery storage demand, the world’s going to need between 120-150 gigafactories by 2020, 2030.

“So there’s going to be a gigafactory in Australia; there’s going to be gigafactories in Australia… And we’re looking at whether we do that, or we help somebody do that. That has to happen and it will happen,” he said.

If it sounds ambitious, that’s because it is. But as Molitor tells it, it’s all going to happen, it’s just a matter of how quickly we get there, and who gets in at the bottom level.

“If you don’t play in storage, you’re going to be left behind. Our approach to thinking about vehicles and batteries is based on overall resource productivity,” he said.

Molitor also added that the economics of new, and current industries need to be re-assessed, because the metrics currently used are all wrong.

“To be economic, the value of the outputs has to be higher than the value of the inputs,” he said. But all inputs had to be measured, that includes energy and resource availability, and not just cost of capital and labour.

Molitor says the current global automotive sector is currently one of the top four “dumbest” industries in the world – alongside the thermal energy generation industry and the beef industry – in that it operates on a completely uneconomic model.

A2emCo’s factories, he says, will tap advanced manufacturing platforms being developed by Siemens and will focus on reducing costs all along the production line, even by keeping the lights off on the factory floor.

It also wants to tap local suppliers, labour and materials.

“If you’re going to think about doing crazy things in Australia, first thing you do is run around and look at what you’ve got in your own backyard.

“We want to create an entire AEV ecosystem in Australia, with Australian suppliers.

“There are a bunch of (Australian) companies doing these things, but none of them are at scale in the absence of a big buyer like us.”

Other musts are to use 100 per cent renewable energy to make and do everything, including recharging batteries.

“That’s fundamental,” Molitor said. “If you’re using fossil fuel energy, you’re absolutely wasting your time.”

And finally, the company hopes to “finance everything” with Australian investors and Australian money.

So far, A2emCo has been funded with equity from “friends, fools and family,” Molitor says, adding that the company also has more than 100 unsolicited proposals for investment.

“At the same way we’re capturing advances in technology, we’re also trying to harness radical changes in the way things are funded.

“We’re quite confident.”

But there are hurdles, Molitor adds, one of the biggest of which will be consumer acceptance.

“We have heads-up display that looks like a jet fighter, so we’ll get all the car monkeys, but will we get the mums?”

“There’s some hesitancy about all of that, but it will be about how we ramp up.”