Potential Marketability of Electric Vehicles

\label{cha:market}

This chapter describes the potential marketability of Electric Vehicles (EVs) in aerobatic racing. Whether the product is marketable depends on its relative performance, product cost and especially long-term operational cost of the aircraft. It will become clear that the knowledge of operational cost has a significant impact on the subsystem trade-offs. Most of all, the potential marketability tests the feasibility on a financial level. The long-term cost performance of the aircraft should be similar to or better than what is available on the market today.

In Section \ref{sec:prod_cost} the marketable product cost is determined based on the off-the-shelf price of current aircraft with an internal combustion engine (ICE). Section \ref{sec:comparison_ev_con} compares the features, advantages and disadvantages of conventional aircraft to an electric variant. Section \ref{sec:oca} then elaborates on the long-term operational cost analysis that was performed to inspect possible financial advantages of EVs. Finally, section \ref{sec:cycle_cost_to} analyses the main factors that determine the marketability: battery cost and cycle life.

Competitive Product Cost

\label{sec:prod_cost}

As the aircraft is the only of its kind at the time of writing, no competing electric designs exist. In order to set a price, one can consider what is available on the market and what aerobatic (race) teams are using for their high performance needs. Prices of currently used racing aircraft can therefore be used as an indicator for what teams are able and willing to pay for a factory new aircraft. Currently used air racing aircraft and their unit cost are shown in Table \ref{tab:competitivecost}. Based on this, a price range of €265,000-350,000 would result in a competitive product cost.

\label{tab:competitivecost}

The found competitive product cost is based on the fact that the aircraft needs to compete with other aircraft that currently play a major role in the RBARs. Popular aerobatic aircraft that do not compete in the RBARs are generally cheaper than €265,000. In order to create the largest market potential, remaining at the lower end of the competitive product cost (approx. €270,000) would be advantageous.

Comparison EVs and conventional aircraft with ICE

\label{sec:comparison_ev_con}

There are some major differences between EVs and conventional ICE aircraft. They are mainly found in the propulsion and power system. The weight, lifespan, cost of components, number of components and thus complexity are different for these systems. An obvious difference is the energy source, resulting in major cost differences per hour flight. The usage of batteries instead of fuel cells (hydrogen) will be assumed in the further analysis (which later turned out to be the best option anyway, see Section \ref{sec:trade_power}). Table \ref{tab:competitivecost2} shows the main parameters used for further cost analysis.

Additionally, it will be assumed that all electric energy comes directly from the grid. The use of solar power would require an initial investment but may result in cheaper long-term operational cost. It can be seen that both electricity from the grid and the price of AVGAS 100LL is cheaper in the US and a potential cost advantage will therefore not be much different overseas \cite{marketanal:electricity,marketanal:gasoline}. The long-term operational cost analysis in Section \ref{sec:oca} will use the EU/NL prices. Furthermore, an 80 kWh capacity for the mission profile is used based on the class I weight estimation in Chapter \ref{cha:classI}. Included in that analysis is - in collaboration with Chapter \ref{cha:classI} - the degradation of the batteries. Batteries are considered to be no longer useful when they are at 80-85% of their original capacity. The required performance can no longer be reached and the endurance of the aircraft becomes too low for other mission profiles.

\label{tab:competitivecost2}

Parameters for long-term cost analysis

Parameters
Engine type	Electric motor	ICE
Engine lifespan	30,000-40,000 hours \cite{marketanal:operationlife}	2000 hours (TBO) \cite{marketanal:lycomingTBO}
Overhaul cost	-	€20,000-25,000 \cite{marketanal:overhaulcost}
Energy type	Grid/Solar power	AVGAS 100LL
Energy cost	EU/NL: 0.20€/kWh; US: 0.12$/kWh \cite{marketanal:electricity}	EU/NL: 2.5€/L; US: 1.4$/L \cite{marketanal:gasoline}
Energy usage	80kWh cap., 160kWh/hr	62L/hr (Extra 300L)
General maintenance cost [\(yr^{-1}\)]	Battery low (monitoring possible); electric motor lower than ICE (fewer components)	Higher: ICEs have many wear-sensitive components
Maintenance overhaul cost	Negligible	1250€/100hrs

The general, high frequency maintenance cost is considered very low for batteries and reasonably low for electric motors. Electric motors have a much smaller number of components than ICEs. In the cost analysis of Section \ref{sec:oca} the general maintenance cost is considered to be negligible compared to other long-term costs. The overhaul cost of electric motors is also considered to be negligible due to the significant lifespan of this component, namely up to 40,000 hours. ICEs - in this case the majority of Lycoming engines - have an advised Time Between Overhauls (TBO) of 2000 hours. This results in an overhaul cost as indicated in Table \ref{tab:competitivecost2}.

Long-term Operational Cost Analysis

\label{sec:oca}

Besides the aforementioned initial purchase cost, potential customers also face ongoing costs such as insurance, taxes, airport fees, maintenance and fuel/energy cost. The latter two in particular show significant differences between EVs and conventional aircraft. This section will provide a long-term operational cost analysis in which the two aircraft types are compared. Maintenance and fuel/energy are incorporated in this analysis. It is assumed that the general maintenance cost of the power and propulsion system is equal and that the main differences are found in engine/motor overhaul cost based on lifespan and the cost of energy.

However, as mentioned in Section \ref{sec:comparison_ev_con}, focusing mainly on energy usage and maintenance cost totally disregards a major drawback of current battery technology. A drawback that could reduce the advantages of the much lower electricity cost to a bare minimum is the cycle life of batteries which is both in current and emerging technology not very high. If the battery degradation is taken into account, a much fairer comparison can be made.

Table \ref{tab:competitivecost3} gives an overview of the battery specifications that are used for an initial operational cost calculation of both conventional and electric vehicles. This can be seen in Figure \ref{fig:cost_adv_1} which uses EU price-points. The operational cost difference is plotted for a long-term - 10-year - period. When analysing the values from Table \ref{tab:competitivecost2} and \ref{tab:competitivecost3} it shows that an EV has only a slight advantage over an ICE aircraft.

\label{tab:competitivecost3}

The main issue with the values in Table \ref{tab:competitivecost3} is that even though the values for the battery cycle life and cost are reasonable, there is an enormous uncertainty. The future of battery technology is simply hard to predict. The uncertainty and low predictability is easily shown by looking at former research into battery technologies and their predicted values for the future. One will notice that the forecast of different researches show quite different values. For example, Lux Research estimated a Lithium Sulphur - one of the very promising technologies - price of $1500-$3000/kWh whereas OXIS Energy - a company heavily involved in the research and development of Li-S - is aiming for a cost of approximately $250/kWh in the near future \cite{marketanal:luxresearchinc,e_bat}.

OXIS Energy is also very optimistic about the cycle life with 1000-2000 cycles \cite{e_bat} for their Li-S technology, whereas the current technology shows way more conservative values. Panasonic Li-ion battery cells of the type NCR18650B - similar to what is used in the relatively high energy density packs of Tesla Motors (ca. 233Wh/kg \cite{marketanal:teslabatteryreport}) - show a cycle life of close to 500 cycles \cite{marketanal:panasonic18650}. The battery cycle life was chosen on the conservative side for a first analysis.

An extensive literature study is required for a better estimate/prediction of these parameters. This will be performed in a later stage of the design process. As these parameters are important for the marketability, the influence on the cost advantage will already be studied in Section \ref{sec:cycle_cost_to}.

\label{fig:cost_adv_1}

Cost Advantage: Cycle life and Battery cost

\label{sec:cycle_cost_to}

It is clear that two parameters which play a major role in the financial feasibility of EVs are battery cycle life and battery cost. The issue of uncertainties of these parameters can be investigated for the power trade-off and a range of feasible values for these parameters can be determined. The cost advantage (difference between the operational cost of an aircraft with an ICE and an EV) is plotted as a function of cycle life for different battery cost. These graphs can be found in Figures \ref{fig:cost_adv_2} and \ref{fig:cost_adv_3} for moderate (50hrs/yr) and intensive usage (250hrs/yr) respectively.

Note that the range of battery cost is limited unlike the estimates by Lux Research that showed a possible cost of $1500-3000/kWh \cite{marketanal:luxresearchinc}. This was purposefully done as there is barely any marketability at those price-points. Furthermore, it could very well be that the values found were overestimates. The same reasoning can be applied to the cycle life range.

\label{fig:cost_adv_2}

From Figure \ref{fig:cost_adv_2} it can be seen that for very moderate usage of the aircraft the entire range of battery cost and cycle life yields an obvious cost advantage for EVs at a long-term (10-year) operation of the aircraft. The main reason is that batteries do not have to be replaced very often, whereas the advantage of energy cost is still major. The cost advantage increase reduces when the cycle life increases.

Figure \ref{fig:cost_adv_3} shows the same relationship but for a much more intensive usage of the aircraft. The battery properties play a higher role here and the marketability based on long-term operational cost is only possible for a diminished range of cost and cycle life. To conclude: the two parameters have a large influence on the marketability, especially for more intensive usage. Budgets should be allocated to enhance a marketable product.

\label{fig:cost_adv_3}