A global shortage of technicians and independent repair shops qualified to fix electric vehicles (EV) threatens to increase repair and warranty costs for drivers, potentially undermining upcoming deadlines to cut vehicle carbon emissions.
From Milan to Melbourne to Malibu, technician training organisations, warranty providers and repairers say that independent repair shops will be vital for making EVs affordable because they are far cheaper than franchise dealers.
Many garage owners balk at training and equipment costs for fixing high-voltage EVs – with 400- and 800-volt systems that could electrocute and kill unwary or untrained technicians in seconds – especially with relatively few EVs on the road.
Along with electrocution risks, the risk of EV fires – which are notoriously hard to put out – also has to be taken seriously.
Roberto Petrilli, 60, who owns an independent repair shop in Milan, is reluctant to spend 30,000 euros ($32,600) on the needed equipment when EV sales in Italy are still low and the charging network is tiny.
"I am seven years away from retirement and I think it is not worth it," said Mr Petrilli.
The auto repair industry has already been short of workers since the pandemic. The Institute of the Motor Industry (IMI) based in Hertford, England, develops automotive training courses and is currently rolling out EV courses across China and aims to do so in India and across Europe.
It forecasts that Britain, with a 2030 fossil-fuel car sale ban, could be short 25,000 EV technicians by 2032.
In the United States, the world's No. 2 auto market after China, EV sales growth has trailed Europe's, but the Bureau of Labour Statistics predicts around 80,000 electrician jobs will be needed annually through 2031, which includes technicians to fix EVs or install EV chargers.
And Australia could be 9,000 EV technicians short by 2030, the Victorian Automotive Chamber of Commerce predicts.
Auto experts fear mechanics like Mr Petrilli in Milan will simply avoid EVs – leaving consumers with higher bills and longer repair times.
Data shared with Reuters by UK used car warranty provider Warrantywise shows costs are already rising - with a one-year warranty for a Tesla Model 3 costing more than triple the average for comparably-priced fossil-fuel models.
Chief executive Lawrence Whittaker said Warrantywise must use expensive franchise dealers to fix EVs because they more often have qualified technicians than independent shops.
Whittaker's concern is that higher insurance and warranty costs mean EVs will remain too expensive for many consumers.
"How are people going to afford the higher repair costs?" he said.
Mark Darvill, managing director at Hillclimb Garage in High Wycombe, about 30 miles (48.3 km) northwest of London, has embraced EVs and hybrids, which he says make up around 15 per cent of repairs.
Mr Darvill says Hillclimb's planned investment of £25,000 ($31,400) in training and equipment will pay for itself in late 2024 when EVs and hybrids should make up 35 per cent of repairs.
Customers lacking EV repair options already come from far afield.
"What's holding a lot of independents back is fear of the unknown," Mr Darvill said.
The IMI estimates 20 per cent of UK automotive technicians have received some EV training, but only 1 per cent are qualified to do more than routine maintenance.
EV sales jumped 33 per cent in Britain in the first half of 2023, but the IMI said take-up of EV qualifications fell 10 per cent in the first quarter and an estimated 31 per cent in the second quarter compared to the number of people taking those courses in the same period in 2022.
London-based premium car service company Addison Lee operates hundreds of EVs and sustainability director Andrew Wescott said "it already takes a lot longer" to repair them than its diesel vehicles.
Car makers are scrambling to train technicians. Market leader Tesla has launched courses at US community colleges to train prospective technicians. Tesla also provides EV training for independent US repair shops.
Daniel Brown, head of automotive product development at Germany's Lucas-Nuelle, which produces EV training course equipment, worries unqualified technicians could be pressured to fix high-voltage EVs, adding "it's just a matter of time until someone gets hurt."
Some groups are trying to fix the shortage.
The Siemens Foundation has unveiled a $30 million programme to train US technicians to install and maintain EV chargers.
A lack of trained workers will "slow the progression" of shifting to electric, foundation chief executive David Etzwiler said. The foundation, which focuses on workforce training and education, has announced the funding to address the "tremendous and immediate" need to train technicians, Mr Etzwiler said.
The Motor Traders' Association of New South Wales (MTA NSW) - where EVs should make up 50 per cent of new car sales by 2030 - estimates basic EV training will cost 100 million Australian dollars ($64.7 million) for the state's nearly 50,000 licensed automotive technicians.
MTA NSW head of government affairs Collin Jennings said small repair shops will need subsidised EV training or many will likely stick to fossil-fuel models. The distances between many smaller Australian towns makes that a problem in the making.
"Who's going to fix your Tesla if it breaks down there?" Mr Jennings said.
The IMI is seeking 15 million pounds from the UK government to help independent repairers afford training, said chief executive Steve Nash.
But Nicholas Wyman, executive director of the US Institute For Workplace Skills and Innovation, said most repairers are on their own.
"If you're waiting for the (US) government to take action, you'll be waiting a long time," he said.
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PROFILE
Name: Enhance Fitness
Year started: 2018
Based: UAE
Employees: 200
Amount raised: $3m
Investors: Global Ventures and angel investors
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Company profile
Company: Verity
Date started: May 2021
Founders: Kamal Al-Samarrai, Dina Shoman and Omar Al Sharif
Based: Dubai
Sector: FinTech
Size: four team members
Stage: Intially bootstrapped but recently closed its first pre-seed round of $800,000
Investors: Wamda, VentureSouq, Beyond Capital and regional angel investors
Bawaal%20
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What is graphene?
Graphene is extracted from graphite and is made up of pure carbon.
It is 200 times more resistant than steel and five times lighter than aluminum.
It conducts electricity better than any other material at room temperature.
It is thought that graphene could boost the useful life of batteries by 10 per cent.
Graphene can also detect cancer cells in the early stages of the disease.
The material was first discovered when Andre Geim and Konstantin Novoselov were 'playing' with graphite at the University of Manchester in 2004.
Greatest Royal Rumble results
John Cena pinned Triple H in a singles match
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Matt Hardy and Bray Wyatt win the Raw Tag Team titles against Cesaro and Sheamus
Jeff Hardy retained the United States title against Jinder Mahal
Bludgeon Brothers retain the SmackDown Tag Team titles against the Usos
Seth Rollins retains the Intercontinental title against The Miz, Finn Balor and Samoa Joe
AJ Styles remains WWE World Heavyweight champion after he and Shinsuke Nakamura are both counted out
The Undertaker beats Rusev in a casket match
Brock Lesnar retains the WWE Universal title against Roman Reigns in a steel cage match
Braun Strowman won the 50-man Royal Rumble by eliminating Big Cass last
'Nope'
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Specs
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Sholto Byrnes on Myanmar politics
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