Tesla might not be all that happy about this and the various governments that are insisting upon electric only vehicles for the future might also regret that decision–Mazda has just announced a breakthrough in internal combustion engine technology. This is great for consumers of course as more choice is good as we get to pick and choose from among the various offerings to find something that more closely meets our needs and desires. But there’s also a larger economic point here which is that we just don’t know what is technological possible over time. Therefore government should not be picking winners, or, as they more normally do, pick losers. It’s fine for us to set a target, we should indeed try to influence decisions away from harm to others through externalities, but the way to do this is to use the free market experimentation machine to explore the various ways of hitting that target. Humans are, after all, pretty inventive beings, it’s worth sitting back and seeing what they can come up with:
Mazda Motor Corp said it would become the world’s first automaker to commercialize a much more efficient petrol engine using technology that deep-pocketed rivals have been trying to engineer for decades, a twist in an industry increasingly going electric.
Mazda has form with this of course, they were rather the only major player to try to get the rotary, or Wankel, engine going mainstream. That was a fascinating rather than perfect technology of course:
Mazda has made the announcement car manufacturers have been working towards for years: it’s releasing the first commercial compression-ignition gasoline engine. Dubbed SkyActiv-X, the engine will be available in 2019 and promises up to 20-30% more engine efficiency than the current SkyActiv-G, and up to 45% more than Mazda’s 2008 petrol engine.
The underlying idea is that why not make petrol engines work like diesel ones? Instead of using spark plugs why not use compression to fire the cylinders? Yes, of course, it’s more complicated than that and this isn’t an engineering site:
“We think it is an imperative and fundamental job for us to pursue the ideal internal combustion engine,” said Mazda’s head of R&D Kiyoshi Fujiwara.
There’s a value to that given the investment in current infrastructure. Worth continuing to use that if we can.
As to the why of the government decisions to go for all electric this isn’t an environmental part of this site either, so leave the reason out of it. This is however about economics. And these sorts of advances in ICE technology are exactly why we want to insist upon general targets, not tight plans for how to reach them. Simply because we are uncertain about what it is possible to do, what it will be possible to do. So, we don’t in fact know the precise technology that we wish to use to reach whatever target it is. Simply, as before, because we don’t know what is technologically possible.
All of which is why free markets of course. A reasonable guess is that right now there are 1 billion things for sale in Manhattan. No, not 1 billion pieces of all things, but 1 billion different things. There will be additions of new things to those, new combinations of them found in the future as well. Some obviously aren’t going to be all that useful, the addition of chocolate ice cream to left hand thread brass screws isn’t going to solve transportation problems anytime soon. But if we set some goal, or even if people spot a way of making money by solving some problem, then they will indeed sort through the various combinations possible to see if there’s something that can be done. In this case–and I emphasise that I’m not an engineer although I know a bit about weird metals and that’s relevant–my guess would be that increased knowledge about metal alloys and tolerances has made this sort of engine only recently possible. Certainly couldn’t be done with what we knew about metals 50 years ago, possibly only really just right now. Another possible reason is that we can only recently machine to the finer tolerances that are needed. But the exact why doesn’t change the underlying idea. There is no planning system which can, in a central manner, sort through all of the possible routes to a problem solution. That’s why we’ve got to go out there to the free market to search for one. There are simply so many different possible combinations, a combination being a useful method, that we need not a centralised bureaucracy doing to experimenting but every profit hungry grouping of engineers out there.
That the internal combustion engine just got more efficient isn’t good news for Tesla even as it’s great for consumers. But that there is yet another 20% efficiency improvement in the ICE shows that we don’t want to be picking winners, instead wait and see which wins.