I am an engineer, and I ran a business for fifteen years designing, building, and racing cars. Unsurprisingly, this field restricted the expression of my deeply held convictions about the environment and, increasingly, the cyclical characteristics of the only successful complex systems we know—those in nature. While trawling for a new career by earning an MBA at Cranfield University, I had to write a major dissertation.
For that assignment, I chose a feasibility study on manufacturing fuel cell cars as an academic business exercise because I felt that the barriers to developing such cars are not technical but human, concerning people, politics, and business. I say "academic exercise" because I regarded these barriers as insurmountable for a new entrant and the technology as unattractive, even suicidal, for an auto manufacturer. By the end of my study, I no longer felt that the former was true.
The Conception of the OSCar
Despite being afflicted by periodic bouts of "overwhelmsion," and having to reinvent myself as an expert in half a dozen different fields, I have subsequently developed the strategies for developing an alternative car that I believe satisfies personal transport needs while respecting the environment. This "Aikido" approach accepts the reality of our context and is smarter and more efficient than expending vast financial, physical, and emotional resources in a futile struggle against natural principles.
The technical concepts revolve around composite-bodied, direct-hydrogen fuel cell cars, driven by an electric motor in each of the four wheels, using regenerative braking to charge a bank of capacitors for re-use later. The common misunderstanding about regenerative braking is that recycling some energy, thus increasing energy efficiency, is the benefit. While this is true as far as it goes, the implications are far greater. The breakthrough is that acceleration and constant-level (cruise) demand are decoupled; the fuel cell provides the modest power for cruise and the capacitors provide the surplus—typically fivefold —required for acceleration.
With lighter cells, and no gearbox or transmission, the structure can be lighter, so less power is required. These iterative loops of weight reduction have become known as mass decompounding. "Add lightweight carbon fiber to the recipe, and eliminate power assisted systems that are no longer required, and the iterative loops are magnified. This represents a step change (a discontinuity rather than incremental evolution or optimisation) in technology.
It also yields a step change in performance, because of integrated design and the resulting synergies between a number of components and existing technologies, none of which makes overwhelming performance or economic sense on its own. The real innovation is in the architecture, so the transition cannot be incremental: "You cannot cross a chasm in two leaps. " As I explain below, I believe that this phenomenon applies at all three levels: technology, strategy, and organisation.
A Different Market Model
The auto industry is incredibly good at what it does; no other product remotely as complex as a car is available at a comparable price. However, the strategies for provision of personal transport must take into account the characteristics of the technology and the environmental and cultural context in which we are now operating. All these have changed from Henry Ford’s day, but this awesome industry has not.
While it has scale, supporting infrastructure, huge productive assets, sophisticated cultures, and refined informal networks, the industry is not suited to providing alternative cars competitively. All the tea in China is no use if you need to make a cup of coffee. The whole value network within which the car manufacturing industry is embedded must change.
Today’s dominant business model— making and selling product—stimulates many great minds to find ways to maximise consumption, whereas the realisation is penetrating even the minds of policy makers that real wealth demands the opposite.
Remedial vision never sees beyond regulating the downside of industry, but rewarding industry for doing what society needs, rather than the opposite, seems to elude us, which is another example of the quite staggeringly muddled thinking that characterises industrial society. It is reasonable to assume that if we create a business model that profits by doing what is known to be needed, policy incentives such as taxes and subsidies will gradually shift in favour of that model.
Such a business model is based on leasing, rather than selling, product. This approach has significant effects throughout the business, right back to the design phase. It also completely changes the economics of providing cyclical solutions— building these cars would be a strategic blunder for a company that then sells them.
Instead of being rewarded for maximising cost, complexity, and maintenance, and minimising the ownership cycle and product life, an enterprise that leases instead of selling cars has a financial interest in reducing cost, complexity, and maintenance. It also has an interest in maximising not only the ownership cycle and product life, but also fuel efficiency (because all fuel would be billed to the manufacturer).
The currently opposed interests of the manufacturer and consumers/ society are thus aligned and a problem is turned into a source of competitive advantage. With the elimination of moving parts (except for wheels) and inert materials extending the economic life of each car to 20 years, the same number of customers can be serviced with 80 percent less production capacity—with the added bonus of reduced recycling liabilities.
Despite higher unit cost, unit margin can be higher yet cost of ownership can be lower. This model can also be extended upstream; doing so has the not entirely incidental benefit of distributing much of the working capital requirements among the whole value network. With hundredfold-lower tooling costs, higher labour costs, and 80 percent lower component count, team assembly will be more productive than line assembly.
Apart from a step change in the quality of jobs created, benefits include less capital investment, more versatile production facilities, lower risk for new models, and production processes that can constantly evolve. This contrasts vividly with the suppression of "human capital" of assembly lines cast in stone by engineers before staff are even hired.
The size of such teams will be governed by the output of car bodies from one set of moulds—at most 5,000, requiring about 200 people for assembly. The next logical step is not putting the teams all in one place. If each plant is one team, the plants can be set up quickly; no plant need be written off as the organisation expands; expansion can track demand, rather than betting the company on a huge new plant; and what economies of scale are possible (tooling, marketing, supply logistics, etc.) can be captured by a hub serving the plants in that region.
Such a distributed model is perfectly suited to reviving regions whose employment base has collapsed, as the plants would give a meaningful boost to employment and community, without requiring excessive development and environmental degradation. The low minimum- efficient scale of production also leads to radical reduction of a variety of economic and cultural entry barriers, such as the need for colossal investments.
Open Source Design
Seeking the benefits of synergies in design of new cars leads us to the Open Source Software movement and its dictum that "Given enough eyeballs, any bug is shallow. " Debugging software is much more trying than writing it; the open source process diminishes that difficulty, as it allows thousands of people to survey all the code—the whole system.
It relies on the contributors’ numbers rather than their brilliance; any one mind can have a flash of inspiration and spot an elegant cross-platform solution, the ultimate intellectual satisfaction for designers in any field. This leads to fewer lines of code and thus both increased efficiency and reliability, directly analogous to a technically elegant, simple, and robust car.
We are developing these concepts for the design of fuel cell cars, with the intention of building a global network of contributors dedicated to developing the technology. None of the people developing open source software are paid; they do it because they enjoy doing it, as it is highly creative and they are involved in a project more satisfying than anything they could possibly do on their own.
This "bazaar" model has demonstrated an ability to develop products faster, which are more robust, integrated, and efficient, than hierarchically structured competitors. As New Scientist magazine has said, Linux can harness "a pool of creativity that Microsoft, for all its huge resources, will never be able to match."
For Microsoft, read Ford or GM. The design process can be coordinated by a small but effective team while the creative powerhouse is the open source community; managing that interface to develop designs appropriate to different economic, cultural, and environmental conditions is the challenge.
The emergence of a value network
Not only does the open source process develop better software, it also blurs the boundaries between stakeholder groups and enables outcomes that would be inconceivable otherwise. Lowering the initial energy barriers, cultural and economic, is more important than trying to maximise market share in the long run, so the emergence of competitors adopting the same standards is much to be encouraged.
Corporate Organisation
The organisational concepts of OSCar are driven by such principles as the preeminent rights of society and the planet over any individual stakeholding group, insulation from the incoherent consequences of rampant capitalism, and avoiding growth for growth’s sake. There is also a conscious focus on resilience as a higher-order quality than profit; it often seems to be forgotten that one cannot achieve resilience without profit, while profit without resilience is easy—and particularly fashionable.
The current iteration of the organisational concept is based on two purposes that are embedded in its vision. These two purposes require two organisations, so that each purpose is always pursued with clarity.
The first is a not-for-profit Open Source Foundation that coordinates the design effort, disseminating the technology globally by licensing the intellectual property rights on the same basis to competitors as to our manufacturing facility.
The second is a commercial company (or ultimately companies) that manufactures cars. Network governance will decouple control from investment, focusing the company on pursuit of the common good by balancing the many conflicting interests of all stakeholders.
As with the ownership model, we are seeking to align interests, building relationships with true funding "partners" based on a complex network of common interests. I believe absolutely that, if we get the organisation right, the right results— commercial, social, and environmental— will be emergent properties of the system.
In a recent exciting development, we have entered into a joint venture with Cranfield University and a small but prestigious British sports car manufacturer and other partners to develop a "proof of concept" car. Most scenarios of the future of personal transport are based on assumptions generated by the auto industry, accepted by related industries and policy makers, concerning the limitations of fuel cell technology.
For instance, they assert that one would need a trailer behind the car to carry enough hydrogen for a realistic range; with our prototype, we hope to dispel such negative ideas. The project has progressed to where it is today with the help of a large number of contributors from many fields and institutions.
The starting point for OSCar was the work of the Rocky Mountain Institute (RMI) on hydrogen fuel cell cars in the ’90s, under the name Hypercar. This work was placed in the public domain in 1997, as RMI’s intention was to encourage the auto industry to make Hypercars, rather than exploit the ideas itself. However, progress has been dictated by the industry’s timeline rather than technical feasibility, so they set up Hypercar, Inc. , to develop a design (www. hypercar. com). The car modelled so far is very similar to a Lexus SUV, except the fuel economy is predicted to be five-fold higher. This approach differs from ours in that it stretches the technology to compete with petrol engines in the high-performance market in which they excel, letting the competition choose the battlefield. In contrast, we aim to exploit OSCar's advantages in more modest performance sectors
Hugo Spowers, is developing his concept under the working title of OSCar Automotive Ltd. , He is based in London and Herefordshire, UK, and can be contacted at hugospow@compuserve. com.