PSA’s Hybrid Air – A low cost technology for the post-crisis rebound

Writing in December about past lessons on innovation for the post-crisis rebound, I relayed Marc Giget’s view that crisis have proven to be a fertile ground for innovation as long as it is frugal. Cost-efficient products, whether in terms of acquisition cost or running costs or both, are the typical winners that lead the way out of the crisis. This lesson casts some doubts on the short term viability of Renault-Nissan’s drive for full electric vehicles, but vindicates the ultra-low-cost strategy that they pursue through their Dacia subsidiary.

Yesterday, another great example surfaced: troubled French car manufacturer PSA (owner of Peugeot and Citroen brands) unveiled its Hybrid Air technology, which seems particularly fit for the post-crisis rebound.

Innovating for the post-crisis rebound

Schumpeter defines innovation as a process of creative destruction. The point is not merely that innovation can still happen in times of crisis; it is that crisis are the best time for era-defining innovations to emerge. In yesterday’s session of the Mardis de l’Innovation cycle (in French), Marc Giget highlighted a few powerful examples of companies, which emerged or re-emerged stronger out of the Great Depression of the 30s with winning products, such as GE and its refrigerators and washing machines, Converse and its emblematic (and ugly) shoes, or the entire machine-tool sector. As it turned out, the Great Depression became one of the most innovative periods in American history.

Today, some post-crisis winners are already emerging, though others may still be in the making. Examples include:

Henry Ford, June 4, 1896 – A story of Passion and Perseverance

It was on a 4th of June – June 4, 1896 – that Henry Ford first drove his Quadricycle, an ethanol-powered proto-automobile. Ford was 32. He had left the family farm at 15. The quadricycle was the outcome of many years of passion for everything mechanical, from watches to industrial machines, and perseverance in experimenting with portable engines.

“The world is moving from car ownership to car usership”

A BBC News article provides a great insight into the revolution in the making that the car industry is about to go through. KPMG sums it up in their annual survey of the auomotive industry: “The world is moving from car ownership to car usership.” Arguably it will take longer than headline-grabbing statements suggest, not least because a large section of the consumer base still feels a strong emotional connection to the car they own or that they wish to own, but it is undeniably underway.

VW drives concept car through shrinking window of opportunity

At a corporate conference I attended earlier this year, a top-executive keynote speaker used the term “shrinking windows of opportunity” to describe a world where change is happening at such a fast pace on such a large scale that there is less and less time to think before you jump: if you think a minute too long, others will have already gone through the window of opportunity and closed it behind them.

Don’t expect electric cars to substitute motor cars like-for-like

Disruptive innovations often combine a changes on several dimensions: product, consumer experience, market segment, business model. The emblematic example remains the iPod, which would not have met its phenomenal success if it had not been associated with the business model change that iTunes brought to the music distribution industry. Like-for-like substitution of the old product by the new product, everything else being equal, is rarely a recipe for breakthrough innovation.

Take the electric car. The current focus of the auto industry is to increase battery autonomy and drastcially reduce recharging time in order to mimic the experience that the motorist currently gets when driving long distances refuelling along the way in a few minutes. This is almost certainly a lost cause!

With Autolib’ the electric BlueCar accelerates

This week, life-long entrepreneur Vincent Bollore and his BlueCar won the contract to run the Autolib’ scheme of the city of Paris. The story so far is rich of innovation lessons.

Firstly, Autolib’ builds on the success of Velib’ and replicates its business model. Launched in 2007 in Paris and now replicated in many other European cities, Velib’ is a bike rental scheme that allows customers to pick a bike from one of the 1,200 points in Paris (one every 300 meters) and return it to another, without having to worry

Green + In-Vehicle Services = the winning formula of automotive in the 2010’s

Consultancy company Accenture publishes the result on an online an Automotive Consumer Survey that it carried out earlier this month in Germany, France, Italy, the US and Canada. The purpose of the survey was to test consumers’ response to the “green” cars trend.

A staggering 42% claimed they were likely to buy a hybrid or electric vehicles in the next 2 years, cleary indicating that green cars are moving beyond