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The paradigm shift to electric cars and to the "smart grid" in electricity distribution is happening.What is particularly interesting is the complementarity and potential convergence between the two innovations, if V2G (Vehicle to Grid) technology develops as promised. In this case, the batteries in parked cars could become distributed accumulators of surplus energy and feed it back into the grid. 

The article reports on Project Better place's vision of the "car of the future", i.e. full electric cars being sold to end users with a "battery swapping" scheme. Will this be the "dominant design" of the cars we will drive 10-15 years from now?

Daimler and Renault signed a strategic alliance sharing competencies and technologies. The alliance is about creating platform projects for components of the new cars. Each company has its components to realize. With this alliance Daimler is changing its traditional business model: the company decided to swicht to the production of small car, where Renault has its core busines competencies. This partnership can also bring the German company in contact with the field of the new electric cars, in which Reanult is well advanced. 

Is private ownership of cars going to decline, in favor of pay-as-you drive car sharing schemes? The shfit from products to services seems to be making the first inroads - at least for younger generations - in what usually was considered a key status symbol and must-have object. Such a shift would of course require a completely different approach by carmakers. Moreover, it is likely to become a powerful force driving the change from traditional to electric cars. 

The transition from conventional to electric cars is probably undergoing the "sailing ship effect". Traditional technology is being improved quite substantially, and this is likely to defer the switch to the emerging technology

Actual usage of electric cars is still a big unknown. Will "range anxiety" be an issue? Where and when will people recharge their vehicles? These uncertainties are critical, given the huge investment that will go in defining future dominant design and infrastructure.

It seems clear that cars are going to go electric ... but when and exactly based on which dominant design? Apart from this there is a huge issue related to time. While in high-tech change is very fast and there is a clear strategic case for being fast, this might not be true in "hard" manufacturing, where diffusion is likely to be slow and painful for early movers, and subject so a significant "sailing ship effect". 

Now that battery-powered vehicles seem to be the solution of choice for the next generation of cars, companies are looking for attractive markets. Will fleets be the right place to go? Maybe yes, if such fleets require short-range urban mission profiles. Maybe not, if all the attractiveness simply is adding a "green touch" to the company. 

Toyota has agreed to invest $50m in Tesla, the Californian builder of battery-powered cars, as it seeks to extend the dominance it has built in petrol-electric hybrids into the next generation of green vehicles. The deal announced on Thursday makes Toyota the second big global automaker to invest in Tesla, a six-year-old startup founded by Elon Musk, creator of the internet payment service PayPal, and backed by other Silicon Valley luminaries such as Google's founders Larry Page and Sergei Brin. The deal could help Toyota repair its reputation in the US after a series of safety problems that have forced it to recall millions of its cars, pay a $16.4m fine and endure multiple investigations by Congress. Toyota has built a big lead in low-emission cars with its Prius hybrid, which went on sale in 1997, and is by far the best-selling alternative to standard petrol-only vehicles. But some other carmakers are preparing to try and leap-frog Toyota by introducing battery-only cars.

2010 seems to be a key year in the paradigm shift from traditional to future (electric?) vehicles. Even if the sales figures are still likely to be low for the next years, most carmakers are committing substantial investment in the new "dominant design". However, the competitive landscape will probably be shaped by new entrants and by startups, that still have to emerge above the horizon

What will the dominant design of next-generation cars be? Renault probably is the most daring automaker, with its decision to bypass hybrids and go straight to full-electric. The business model is changing, and they are partnering with Project Better Place so that people will use batteries on a pay-per-use base.

More and more car companies are getting their feet in next-generation vehicles. In this case, by buying a stake in a startup company.

Renault-Nissan probably is the most outspoken carmaker supporting the shift to electric vehicles. It is interesting to notice its understanding of the role of complementary goods (i.e. recharging stations) in supporting diffusion, and of the value of high vertical integration during the fluid phase of innovation (e.g. batteries).

Another post on "the car of the future". Radically new architecture (fuel cells, electric wheels, ultracapacitors, etc.) and business model based on microfactories and open source IP. Will it be the dominant design of the future?

Toyota is maintaining its ambitious targets on the diffusion of hybrid cars. Some competitors are pushing the full-electric concept, guess why?

A report on BMW's megacity project, investigating the "car of the future", trying to revisit product architecture as well as underlying technology... which leads to a "real" concept of radical innovation

Tesla Motors shares are now traded on the Stock Exchange. It is the first time since more than 50 years that a US carmaker launches an IPO. A sign that a paradigm shift is indeed under way in automotive? Probably yes.