More than 1,100 car-makers and their suppliers are meeting at this year's Frankfurt Motor Show, which is still the world's largest and most watched. Held from last Thursday to Sept 27, the leading automotive trade fair is expected to witness the unveiling of 83 new models and draw more than one million visitors.
This biennial event is staged as the industry is reeling from a massive slowdown in China - the single largest market for several companies. More crucially, it is a time when manufacturers are caught between conflicting expectations of drivers and regulators. Customers want cheap driverless cars and thirsty SUVs. The authorities want to be sure the technology is safe and emissions are low.
Manufacturer profit margins, already suffering from fierce price competition, could get crunched. With driverless cars, regulators are beginning to insist on the development of automatic accident- reporting systems and automatic emergency brakes, which will improve safety but raise costs.
Meanwhile, a poll by McKinsey shows that three-quarters of German drivers like the idea of driverless cars, but only if the overall price stays about the same.
With emissions, electric cars are key for the industry.
Many of the technological eye-catchers are evident at the Frankfurt extravaganza. Volkswagen, Europe's largest car-maker, said it would launch 20 new electric vehicles by 2020. Porsche unveiled an electric concept car boasting 600bhp and a range of 500km.
But customers are yet to be convinced. Data from consultancy firm Roland Berger shows that electric cars have a market share of 0.4 per cent in China, 0.5 per cent in Germany and 0.7 per cent in the United States.
The SUV boom exacerbates the problem. SUVs are heavier and less aerodynamic than sedans and typically burn about 25 per cent more fuel. Yet, researchers at consultancy IHS Automotive foresee the SUV slice of the pie growing to 25 per cent, up from 20 today.
Profit margins of mass-market car-makers are already thin. Renault, Peugeot and Volkswagen eke out a measly 3 to 6 per cent at the operating level, though premium brands such as Mercedes-Benz, BMW and Audi get 10 to 12 per cent.
All are frantically trying to get economies of scale and cut costs. The best investors can hope for is that productivity gains are big enough to counter the technological and regulatory headwinds.
PORSCHE MISSION E
If realised, this 440kW stunner - with a range of 500km and which takes only 15 minutes to recharge - will make Tesla look dated. The four-seater all-wheel-drive is powered by an 800-volt drive system and can hit 100kmh in under 3.5 seconds.
This hybrid concept boasts the rugged sportiness of a crossover and the efficiency of a Prius. The C-HR will help Toyota meet exploding demand for crossovers, and counter Volkswagen Group's challenge to the No. 1 sales spot. Toyota says the C-HR's engine has a thermal efficiency of more than 40 per cent, matching a claim it made about the redesigned Prius hybrid shown recently.
This bold crossover concept has front doors that swing out and up when opened, a pair of rear-hinged half-doors and no B-pillar to allow easy access to its 2+2 interior. Embedded in its headlights are cameras that record every journey. Powered by a series hybrid system, the Gripz is 4,100mm long, 1,890mm wide and 1,500mm tall, with a wheelbase of 2,580mm.
ALFA ROMEO GIULIA QUADRIFOGLIO
This high-performance sedan sprints to 100kmh in 3.9 seconds and on to a top speed of 306kmh. Yet, it emits just 198g/km of CO2. Alfa's first serious challenge to BMW's celebrated M cars, it is powered by a twin-turbocharged 510bhp 3-litre V6. Mama mia.
Jaguar's first crossover boasts a strong and stiff aluminium architecture, and promises agility, refinement and efficiency. It has an unrivalled 650-litre luggage compartment, all-wheel-drive and new traction technology such as adaptive surface response. Jaguar Land Rover claims its InControl Touch Pro is the world's most advanced infotainment system - with a 10.2-inch tablet-style touchscreen and Wi-Fi connectivity for up to eight devices. Engine choices include a 180bhp 2-litre Ingenium diesel, a supercharged 380bhp 3-litre V6 petrol and a 300bhp 3-litre V6 diesel with 700Nm of torque.
MERCEDES-BENZ INTELLIGENT AERODYNAMIC AUTOMOBILE
This concept is a "four-door coupe" with a drag-coefficient value of just 0.19, making it the most aerodynamic car that seats four. It switches automatically from design mode to aerodynamic mode when the vehicle reaches a speed of 80kmh.
For instance, eight segments extend from the rear, increasing its length by up to 390mm; front flaps in the front bumper extend by 25mm to the front and 20mm to the rear, improving the air flow around the front; Active Rims alter their cupping from 55mm to zero; and the louvre in the front bumper moves 60mm to the rear, improving the underbody air flow.
LAMBORGHINI HURACAN LP610-4 SPYDER
Like the Ferrari 488 GTB Spider, this convertible Lambo remains loud, outrageous and politically incorrect. The Huracan LP610-4 Spyder succeeds the Gallardo LP560-4 Spyder. It has a soft top, a 610bhp V10 mated to a seven-speed dual-clutch transmission and the ability to make bad-hair days fun.
KIA OPTIMA GT
This four-door five-seater is for those who want a vanilla sedan but with a bit more oomph. Its 2-litre turbocharged engine puts out 245bhp and 353Nm, and is mated to a six-speed automatic transmission.
With its chunky proportions and masculine body style, this concept from the Indian-owned Korean manufacturer will appeal to the caveman in everyone. But its powertrain will not upset tree huggers (much). Engine choices include a 1.6-litre diesel and 1.6-litre petrol equipped with an electric all-wheel-drive system. This system comprises a lithium-ion battery pack and two rear-mounted electric motors. The roof consists of a carbon frame and a canvas layer which can be rolled back for "open-top" motoring.
AUDI E-TRON QUATTRO
Like the electric concept unveiled by its sister brand Porsche, this future battery-powered Audi is said to have a range of 500km. It has all-wheel-steer and electric all-wheel-drive - thanks to one front and two rear-mounted motors. The driver has 370kW and more than 800Nm of torque at his disposal, allowing him to reach 100kmh in 4.6 seconds and a governed top speed of 211kmh.
The second-generation Tiguan is the first Volkswagen Group SUV to be based on its new modular transverse matrix platform. Perceptibly sportier, the car weighs 50kg lighter than its predecessor and offers up to 615 litres of cargo space. It is powered by a choice of eight engines, ranging from 115bhp to 240bhp. Overall, it is up to 24 per cent more efficient.
This crossover concept hints at what the next CX-7 will look like. It is said to offer superior aerodynamics and, with it, high-speed stability. At only 1,500mm tall, it looks broader and more planted than most other crossovers.
Unveiled long before the show, this compact hatch is offered with a wide range of engines. In the base model, a 1.6-litre with either 122bhp or 156bhp will be joined by a 1.5-litre and a 2.2-litre turbodiesel putting out 109bhp and 170bhp. There is also a 2-litre petrol producing 211bhp. All are paired with a seven-speed dual-clutch gearbox.
Compiled by Christopher Tan