Carmakers Open IP Vaults To Boost Electric Car Demand 12/01/2016 by Bruce Gain for Intellectual Property Watch 1 Comment IP-Watch is a non-profit independent news service, and subscribing to our service helps support our goals of bringing more transparency to global IP and innovation policies. To access all of our content, please subscribe now. You also have the opportunity to offer additional support to your subscription, or to donate. Several carmakers are aggressively sharing intellectual property and patents in a collective bid to help the fledging vehicle type catch on in the marketplace as a mainstream alternative. Tesla model S 70D Like players in other technology-driven industries, carmakers are usually protective of patents and trade secrets, which serve as an increasingly critical selling point to differentiate models. Carmakers may often form developmental alliances, but yet-to-be introduced technologies generally remain closely guarded. But tasked with how to build volumes of scale for electric cars, which have yet to take hold as a mainstream alternative to combustion engine cars, automakers increasingly are sharing more IP to collectively stoke large-scale demand in the sector. “For electric vehicles, since adoption has taken longer than the market anticipated; sharing IP and patents can allow OEMs [original equipment manufacturers] help one another discover breakthroughs and discover new efficiencies with various components,” Devin Lindsay, a principal analyst for IHS Automotive, told Intellectual Property Watch. More sharing will help to grow sales across the sector, while limited and closely guarded access to IP would otherwise limit the development, and ultimately, the acceptance of electrified cars as a mainstream alterative to combustion engine vehicles. “We’ve concluded that our huge number of patents have limited lifetimes and excluding others from the marketplace doesn’t have value,” Kevin Layden, director of director, electrified powertrain engineering for Ford Motor Co., told Intellectual Property Watch. “The bigger value is to work together to deliver this very important technology to the marketplace.” Improved access to IP that carmakers share with the industry could help to lower manufacturing costs, by making electric cars cheaper to develop and produce. “We are putting a lot of engineering talent to develop common technologies that will drive [down] costs for the entire industry,” Layden said. “Others are getting into the game and we don’t want IP to get into the way of what they want to do.” Sharing IP developed by OEMs with suppliers is also crucial. “We really need to have a strong supplier base that can supply the technologies and the materials, with openness to share and collaborate,” Layden said. “We certainly don’t want to put restrictions into place that favour one specific technology or manufacturer.” Among other things, sharing intellectual property between car OEMs and their suppliers allows for “more checks and balances” and could boost the underlying quality of electric cars, Lindsay said. “Collaboration allows all participating OEMs and suppliers to bring their individual strengths towards a given technology to the table,” said Lindsay. “This is certainly the strategy behind the numerous joint ventures and the IP sharing we are seeing on fuel cell vehicles.” Opening up the Treasure Vault Ford recently announced that it is opening up several hundred patents to third parties for the development of electrified vehicles. Ford C-MAX Energi 03 HR In total, Ford has more than 650 electrified vehicle patents and approximately 1,000 pending patent applications on file available for electrified vehicles, including all-electric and plugin hybrids as well as hybrid vehicles. For batteries, the key component in electric cars, Ford is offering a patent to third parties that it says extends the battery life by improving distribution of the electric charge in a battery. Ford offers its patents directly or through AutoHarvest, a non-profit licensing marketplace that Ford helped to found. “AutoHarvest gives potential partners outside of Ford what they need to understand the details of Ford’s electric technology and about how to use it,” Layden said. Tesla attracted considerable media attention when it announced in a 2014 blog post entitled, “All Our Patent Are Belong to You” by Tesla CEO Elon Musk that the company would make all of its patents available for use. “Tesla was created to accelerate the advent of sustainable transport which includes encouraging all OEMs to build compelling electric vehicles that will drive more adoption and awareness of the value of driving electric,” a Tesla spokesperson told Intellectual Property Watch. “Our patents are open for anyone to access and use.” However, the Tesla spokesperson did not offer an examples of third parties using Tesla patents for free. “We can’t keep track of who is accessing them because they are just available, and there is no need to request access through Tesla,” the spokesperson said. “So yes, people could be accessing and using them.” Ford is in discussions with “three potential partners” for use of its patents for which it charges a licensing fee, but Layden said it was too early to specify who they are, pending completion of sales discussions. The Renault-Nissan Alliance has also opened its intellectual property for collaboration with third parties with a focus on sharing development and technologies for electric vehicle charging infrastructure. With their low driving range compared to combustion engine cars, the availability of charging stations is often seen as critical missing link in consumers’ acceptance of electric cars. To this end, according to IHS Automotive, the global electric vehicle charger market is forecast to grow from more than 1 million units in 2014 to more than 12.7 million units in 2020. “More electric vehicles on the road requires a greater charging infrastructure that all EV [electric vehicle] manufacturers can benefit from in the end,” Lindsay said. Nissan has co-developed technologies for charging stations throughout Japan, the US, and Europe while Renault has formed similar technology-sharing partnerships with national and local governments, electricity provider EDF, and other third parties. “In order to establish an electric car ecosystem, automakers, governments, and energy providers must all play their part,” Guillaume Berthier, Renault’s director of electric vehicle sales worldwide, told Intellectual Property Watch. More Help Needed Meanwhile, sharing intellectual property among industry players alone will unlikely serve as a watershed trend that will alone make electric cars a mainstream alternative given their slow reception in the marketplace. After the much media-hyped Nissan Leaf launch at the end of 2010, for example, electric cars will likely not come close to Nissan and Renault CEO Carlos Ghosn’s prediction in 2010 that electric cars would represent 10 percent of all cars sold by 2020. According to IHS Automotive, plugin electric cars represented less than 2 of all cars sold worldwide in 2015. That proportion could possibly decline this year due to falling gasoline prices, making combustion engine cars more attractive. Musk’s blog post in 2014 also still rings true almost two years later. “At Tesla, we felt compelled to create patents out of concern that the big car companies would copy our technology and then use their massive manufacturing, sales and marketing power to overwhelm Tesla. We couldn’t have been more wrong,” Musk wrote. “The unfortunate reality is the opposite: electric car programs (or programs for any vehicle that doesn’t burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1 percent of their total vehicle sales.” However, automakers have no choice but to share their IP in the near term, especially considering the dire sales numbers of electric cars thus far. “If everyone keeps their IP and patents in-house, it may mean no one really gets on the field ever to even play. But if everyone dedicates a considerable amount of time and money hoping a technology gets significant penetration in the marketplace and it does not, all you can really do is just use what you can on other applications and hope you can apply the rest in the near future,” Layden said. “However, if enough sharing can take place and everyone gets to the point where consumers are purchasing the technology,” he said, “they know there will be plenty of time for years to come to battle with TV ads and put their own spin on who makes what better.” Bruce Gain may be reached at email@example.com."Carmakers Open IP Vaults To Boost Electric Car Demand" by Intellectual Property Watch is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.