by River Davis (Wall Street Journal) Akio Toyoda’s comments come amid cooling U.S. demand and a price war with China -- Toyota Motor Chairman Akio Toyoda, when asked about electric-vehicle challenges including a recent lull in U.S. demand, said the industry was coming to recognize that there isn’t a single answer to reducing carbon emissions.
“People are finally seeing reality,” Toyoda said Wednesday (October 24, 2023), speaking in his capacity as the head of the Japan Automobile Manufacturers Association.
Toyoda, who stepped down this year as Toyota chief executive after nearly 14 years on the job, has long said the auto industry should hedge its bets by continuing to invest in hybrid gasoline-electric cars and other options beyond just electric vehicles.
As EV sales momentum lags behind in the U.S. and more buyers gravitate to hybrids, he may be enjoying an “I told you so” moment.
“There are many ways to climb the mountain that is achieving carbon neutrality,” Toyoda told a small group of reporters at the Japan Mobility Show, formerly the Tokyo Motor Show, which is opening this week for the first time in four years.
From Tesla to Ford Motor, automakers in recent months have been issuing warnings about a sudden slowdown in consumer demand for EVs, which are generally more expensive than traditional gasoline-powered cars and need to be recharged regularly, posing challenges for some drivers.
Higher interest rates are making them more unaffordable for many buyers, and despite increasing discounts on plug-in models, unsold inventory is starting to stack up at dealerships.
The pullback in buyer interest is a worrisome sign for an industry that is sinking billions of dollars in new factories and battery-making facilities and is facing tougher regulations on tailpipe emissions globally.
In the latest sign that car companies are walking back their plans, General Motors and Honda Motor said Wednesday that they are ditching a partnership forged a year-and-a-half ago aimed at developing a line of lower-priced EVs.
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GM also this week abandoned a self-imposed target to build 400,000 EVs by mid-2024, citing growing uncertainty in the EV market and the need to ensure it can build these new models profitably.
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One favorable sign for Toyota: Its head of sales in North America said recently the market for hybrids is “smoking hot” and the company is trying to make as many of the vehicles as possible. Last month, Toyota had a little more than a week’s worth of Prius hybrids in stock, compared with more than two months’ supply of its electric SUV, the bZ4X.
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General Motors said last week it was delaying the opening of an electric pickup-truck factory in Michigan. The Wall Street Journal also reported that Ford Motor was considering cutting a work shift at the plant where it builds its electric F-150 Lightning pickup as demand for the truck falters.
Meanwhile, hybrid sales have taken off in the U.S., growing at a faster clip than the broader U.S. car market. READ MORE
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Ford cuts battery orders as EV losses top $100,000 per car The move is part a retrenchment of Ford’s EV strategy, which includes reducing spending by $12 billion on batteries ... (Detroit News)
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Ford Begins Cutting Supplier Battery Orders As Electric Vehicle Market Sours (Auto Spies)
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Ford reducing battery orders as it loses over $100,000 per EV sold (Teslarati)
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Electric Vehicles: Ford Runs Down Batteries (National Review)
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GOP Senator: Look at the Numbers, ‘Americans Don’t Want EVs’ (1010WCSI/NAFB News Service)
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Many US consumers staying away from EVs due to lack of charging availability: report: Anxiety about the availability of charging stations was the leading reason car shoppers were disinterested in EVs, the study found (Fox Business)
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Washington Wants to Ensure No Chinese EVs Ever Reach the US (Bloomberg)
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Natural Gas to Hit $3 by 2025 on AI Boom, Haynes and Boone Says (Bloomberg)
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EVs and hybrids are twice as likely to hit pedestrians as gas cars, study shows (Los Angeles Times)
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US: Nissan adjusts EV production plans amidst declining demand (electrive)
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Toyota shows ‘an engine reborn’ with green fuel despite global push for battery electric cars (Associated Press)
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People worry about electric vehicle price, reliability. EPA mandate out of line. (Columbus Dispatch)
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Many Americans are still shying away from EVs despite Biden's push, an AP-NORC/EPIC poll finds (ABC News)
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Majority of Americans oppose EV incentives — poll: University of Chicago researchers documented public opinion on oil, gas, renewables, nuclear power and climate change. (Politico Pro Energywire)
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Electric car discounts now ‘unsustainable’ amid record price cuts (The Telegraph)
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AAA finds drivers now prefer hybrids over EVs (Repairer Driven News)
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Used EV price crash keeps getting deeper with ‘premium’ brand idea history (CNBC)
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McKinsey: 46% of U.S. EV owners want to switch to ICE vehicles (Repairer Driven News)
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Fisker files for bankruptcy protection, the second electric vehicle maker to do so in the past year (Newsday/Associated Press)
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Here's the Staggering Amount of Money Ford Loses on Each EV It Makes (Motley Fool/Yahoo!)
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EVs Lose Significant Battery Range in a Heat Dome: Extreme cold isn’t the only concern when it comes to EV performance. (Motor Biscuit)
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EV adoption falls to its lowest point since 2021: JD Power -- Meanwhile, electric vehicles are more available than they’ve ever been. (Utility Dive)
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Used EV Prices in Freefall -- Dealers should plan to discount heavily to clear inventory, reports iSeeCars. (Wards Auto)
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Stellantis could axe UK production unless government acts on EVs (Reuters)
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How Americans View National, Local and Personal Energy Choices (Pew Research Center)
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EVs are giving new owners more headaches, and Tesla is a big reason why: J.D. Power study -- J.D. Power's latest initial quality survey finds that EVs have more problems and higher severity of repairs compared to traditional autos. (Yahoo! Finance; includes VIDEO)
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On average, owners of new EVs reported more problems than owners of internal-combustion vehicles (Green Car Reports)
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Lack of affordable electric vehicles will limit widespread US adoption until at least 2028: BofA (Utility Dive)
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Indonesia’s massive metals build-out is felling the forest for batteries (Associated Press)
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Electricity prices get political in Trump’s world: Republicans are using the cost of power — usually an arcane issue — in a populist attack on Biden’s economic and climate policies. (E&E News Energywire)
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Ford pivots from EV plans to heavy-duty trucks at Canada facility (Reuters)
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Tesla's California car registrations fall for third straight quarter (Reuters)
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GM CEO Barra Backs Away From One Million EV Production Goal (Bloomberg)
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“Too ambitious:” Ford ditches EU plan to go all-electric by 2030 (The Driven)
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Tesla profit margins worst in five years as price cuts, incentives weigh (Reuters)
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Carmakers Tripped Up by Choppy Present as They Chase an EV Future -- Ford, GM, Tesla see their stocks fall amid mounting signs of near-term pressure on profits (Wall Street Journal)
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Tesla recalls 1.85 million US vehicles over unlatched hood issue (Reuters)
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Record Payouts on Biggest US Grid Signal Costs of Reliable Power (Bloomberg/Yahoo! Finance)
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This Wild Chart Shows How Different The Electric Vehicle Market Truly Is (Autopian)
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EV Collision Repair Costs 20% More Than for Gas Models: (Green Car Reports)
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Car giants are being forced to confront some hard truths over the EV transition (CNBC)
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Chinese battery project stirs up trouble in Michigan (Politico's Power Switch)
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50K gallons of water needed to put out Tesla semi-truck fire: officials (Nebraska TV)
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EVs are cleaner than gas cars, but a growing share of Americans don't believe it (NPR)
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After Hurricane Milton, a growing risk: Flooded electric cars going up in flames (Miami Herald)
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Florida fire marshal calls electric vehicles "ticking time bombs" amid Hurricane Milton flooding (CBS News)
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Electric car drivers ‘being plunged into negative equity’ as prices collapse (The Telegraph/Yahoo! Finance)
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Japan Hopes Electric Cars Were Just a Bad Dream (Bloombert/Mint)
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Ford’s Third-Quarter Profit Falls as EV Losses Persist -- Automaker projects full-year profit at the bottom end of its guidance (Wall Street Journal)
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Volkswagen Group to shut three factories amid falling EV demand (Car Dealer Magazine)
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Hertz Falls on Mounting Losses From Failed Bet on Tesla EVs (Bloomberg/Yahoo! Finance)
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Fiery Tesla Crash Traps And Kills Four After Electric Doors Couldn’t Open (Jalopnik)
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France slashes electric-car subsidies amid budget crunch (Reuters)
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Consumer Reports survey finds electric vehicle reliability improving but lagging gas models (Associated Press)
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The Dark Side of Electric Cars: Cobalt, Corruption, and Child Labor (Dagens/MSN)
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'$72,000 For A Kia?' – Dave Ramsey Tells Florida Woman 'We'll Call That Debt A Stupid Tax' After Husband Buys EV Now Worth Only Half That (Benzinga/Yahoo!)
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The Downsides Of Buying An Electric Car (Autos Today Magazine)
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Feds say gasoline-powered cars are more ‘convenient’ than EVs -- The Government Accountability Office surveyed officials at 11 federal agencies about their acquisition of zero-emission vehicles. (Politico Pro Energywire)
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Federal Vehicle Fleet: Efforts are Underway to Facilitate the Transition to Zero Emission Vehicles (Government Accountability Office)
Excerpt from Yahoo! Finance: Shares duly tanked as investors digested an uncertain future for the undisputed EV leader. In fact, Morgan Stanley analyst Adam Jonas makes the case that Tesla’s dire outlook could have massive ramifications for the wider industry.
“Beyond the scope of negative estimate revisions for Tesla following a disappointing 3Q result and one of the most cautious conference calls in years, we believe investors should seriously consider the implications for the broader global EV complex,” Jonas explained. “We see a warning from the ‘gold standard’ of EVs having a ripple effect across the industry. In our view, Tesla’s caution = caution for EVs broadly.”
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As such, Jonas anticipates a bit of an about-face to take place. “We expect to see the Detroit OEMs bring greater attention to the attractiveness and profitability of their ICE portfolios while, at the margin, de-emphasizing their EV plans. This process has already begun,” he summed up. READ MORE
Excerpt from Business Insider: Several C-Suite leaders at some of the biggest carmakers voiced fresh unease about the electric car market's growth as concerns over the viability of these vehicles put their multi-billion-dollar electrification strategies at risk.
Among those hand-wringing is GM's Mary Barra, historically one of the automotive industry's most bullish CEOs on the future of electric vehicles.
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But this week on GM's third-quarter earnings call, Barra and GM struck a more sober tone. The company announced with its quarterly results that it's abandoning its targets to build 100,000 EVs in the second half of this year and another 400,000 by the first six months of 2024. GM doesn't know when it will hit those targets.
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While GM's about-face was somewhat of a surprise to investors, the Detroit car company is not alone in this new view of the EV future. Even Tesla's Elon Musk warned on a recent earnings call that economic concerns would lead to waning vehicle demand, even for the long-time EV market leader.
Meanwhile, Mercedes-Benz — which is having to discount its EVs by several thousand dollars just to get them in customers' hands — isn't mincing words about the state of the EV market.
"This is a pretty brutal space," CFO Harald Wilhelm said on an analyst call. "I can hardly imagine the current status quo is fully sustainable for everybody."
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That's as inventory builds up at dealerships, much to the chagrin of dealers. While car buyers are in luck if they're looking for a deal on a plug-in vehicle, executives are finding even significant markdowns and discounts aren't enough. These cars are taking dealers longer to sell compared with their gas counterparts as the next wave of buyers focus on cost, infrastructure challenges, and lifestyle barriers to adopting.
Just a few months after dealers started coming forward to warn of slowing EV demand, manufacturers appear to be catching up to that reality. Ford was the first to fold, after dealers started turning away Mach-E allocations. In July, the company extended its self-imposed deadline to hit annual electric vehicle production of 600,000 by a year, and abandoned a 2026 target to build 2 million EVs.
In scrapping plans with GM to co-develop sub-$30,000 EVs, Honda CEO Toshihiro Mibe said the shifting EV environment was difficult to gauge. READ MORE
Excerpt from Wall Street Journal: Sales of all-electric models in the U.S. have plateaued around the 100,000-a-month mark for the past half year after a period of rapid growth. Inventories are piling up and prices are falling, led by market leader Tesla. The average new EV sold for about $52,000 in October, down from around $65,000 a year ago, according to Cox Automotive.
Whether or not adoption of EVs in the U.S. is actually stalling—the jury is out—it is clearly weaker than manufacturers were anticipating.
Ford and General Motors have both pushed back investments, and even Tesla Chief Executive Elon Musk hinted on the company’s October earnings call that he might slow down. While the course correction is starker in the U.S., there are similar moves across the Atlantic:
Volkswagen has put a plan to build a fourth battery plant on hold.
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The bigger picture is probably that the affluent tech enthusiasts who fueled the first wave of interest in EVs already have them. The next cohort of consumers may need a combination of lower prices, better charging infrastructure and benchmark-setting new products to make the big switch. Baby steps are easier: Hybrid leader Toyota was one of the few manufacturers to say it was boosting its investments recently.
Some potential EV buyers may be waiting for Tesla’s refreshed Model 3, which has just become available in China and Europe but not yet in the company’s home market. Another reason to wait is Washington’s $7,500 EV tax credit: Starting next year, it will be accessible as a rebate at the point of sale rather than months later when filing tax returns. This change could give the EV market a lift next year, but it is hard to be sure because the sourcing hoops manufacturers must jump through to qualify for the subsidy also will get tighter.
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As HSBC analyst Mike Tyndall points out, cars sold through leases are reliant on robust forecasts for secondhand values to keep monthly payments down. Price cuts have wreaked havoc on the used-EV market, making such forecasts harder to justify. Leasing went quiet during the pandemic, but is making a comeback with EVs because leased models qualify more easily for the federal tax credits.
The only long-term solution is for manufacturers to lower costs through radical re-engineering. Except for Tesla and a few Chinese companies, today’s EVs are even more expensive to make than to buy. Ford, which is unusual in breaking out its EV business, continues to report massive losses on a portfolio including the Mustang Mach-E and F-150 Lightning.
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Musk called the next-generation $25,000 Tesla “utilitarian” on the last earnings call, which didn’t inspire confidence.
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The basic problem is that metal-rich batteries and electric motors are more expensive than the gasoline tanks and engines they replace, particularly for the heavy sport-utility vehicles and pickup trucks Americans favor. EV running costs are lower, but most consumers only pay attention to fuel efficiency during gas-price spikes. Manufacturers need to assume that the average car buyer won’t pay a premium.
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And nonunionized EV startups such as Rivian have had even bigger cost problems than Detroit. READ MORE
Excerpt from EV Voice of the Customer: In just three weeks, 3,882 dealerships reflecting the voice of our customers, representing all major vehicle manufacturing brands spanning 50 states, called on the President of the United States to tap the brakes on the proposed Electric Vehicle Mandate. Below is the letter and list of the dealerships that signed.
A Letter to the President
Dear Mr. President,
We are auto dealers from across the country who collectively sell every major brand in the U.S. We are small businesses employing thousands of Americans. We are deeply committed to the customers we serve and the communities where we operate, which is why we are asking you to slow down your proposed regulations mandating battery electric vehicle (BEV) production and distribution.
Your Administration has proposed regulations that would essentially mandate a dramatic shift to battery electric vehicles (BEVs), increasing year after year until 2032, when two out of every three vehicles sold in America would have to be battery electric.
Currently, there are many excellent battery electric vehicles available for consumers to purchase. These vehicles are ideal for many people, and we believe their appeal will grow over time. The reality, however, is that electric vehicle demand today is not keeping up with the large influx of BEVs arriving at our dealerships prompted by the current regulations. BEVs are stacking up on our lots.
Last year, there was a lot of hope and hype about EVs. Early adopters formed an initial line and were ready to buy these vehicles as soon as we had them to sell. But that enthusiasm has stalled. Today, the supply of unsold BEVs is surging, as they are not selling nearly as fast as they are arriving at our dealerships -- even with deep price cuts, manufacturer incentives, and generous government incentives.
While the goals of the regulations are admirable, they require consumer acceptance to become a reality. With each passing day, it becomes more apparent that this attempted electric vehicle mandate is unrealistic based on current and forecasted customer demand. Already, electric vehicles are stacking up on our lots which is our best indicator of customer demand in the marketplace.
Mr. President, no government agency, no think tank, and no polling firm knows more about the automobile customer than us. We talk to customers every day. As retail automotive dealerships, we are agnostic as to what we sell. Our business is to provide customers with vehicles that meet the needs of their budgets and lifestyles.
Some customers are in the market for electric vehicles, and we are thrilled to sell them. But the majority of customers are simply not ready to make the change. They are concerned about BEVs being unaffordable. Many do not have garages for home charging or easy access to public charging stations. Customers are also concerned about the loss of driving range in cold or hot weather. Some have long daily commutes and don’t have the extra time to charge the battery. Truck buyers are especially put off by the dramatic loss of range when towing. Today’s current technology is not adequate to support the needs of the majority of our consumers.
Many of these challenges can and will be addressed by our manufacturers, but many of these challenges are outside of their control. Reliable charging networks, electric grid stability, sourcing of materials, and many other issues need time to resolve. And finally, many people just want to make their own choice about what vehicle is right for them.
Mr. President, it is time to tap the brakes on the unrealistic government electric vehicle mandate. Allow time for the battery technology to advance. Allow time to make BEVs more affordable. Allow time to develop domestic sources for the minerals to make batteries. Allow time for the charging infrastructure to be built and prove reliable. And most of all, allow time for the American consumer to get comfortable with the technology and make the choice to buy an electric vehicle.
Sincerely,
Supporting Dealerships
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Except from CBS News: Electric vehicles have nearly 80% more problems and are generally less reliable than cars propelled by conventional internal combustion engines, according to a new report from Consumer Reports.
Plug-in hybrid electric vehicles (PHEV) have an even worse scorecard, with an average of almost 150% more problems, the consumer group found. By contrast, ordinary hybrid cars are a "bright spot," with about a quarter fewer problems than gas-powered cars, the analysis found.
Consumer Reports' latest vehicle reliability report comes as car buyers can take advantage of a federal tax credit worth up to $7,500 for purchasing an EV and as automakers roll out a host of new models. But consumers have been slower to adapt to EVs than expected, partly because they are often more expensive to maintain than traditional vehicles and require extra equipment, such as a home electric charging port.
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EV owners most frequently reported troubles with battery and charging systems, as well as flaws in how the vehicles' body panels and interior parts fit together.
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PHEVs may have more problems than conventional cars and electric vehicles because they combine internal-combustion engines with an electric drive, which creates additional complexity, Consumer Reports said. That means there's more than can go wrong.
Consumer Reports rates vehicles on 20 problem areas, ranging from squeaky brakes to EV charging problems, and PHEVs can experience every one of them, it noted. READ MORE
Excerpt from Bloomberg: “The slowdown in the ambition from the two of the Big Three US automakers, combined with Tesla’s aging model lineup limiting its growth potential, and tougher economic conditions for many of the US customers, indicate that the US EV market is facing a more difficult year,” BNEF analysts led by Aleksandra O’Donovan write in the report.
GM and Ford pushed back near-term EV targets in the second half of this year, citing less consumer demand for their plug-in models than expected.
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The researcher also trimmed its projections for Europe and China, citing factors including high interest rates for the former and broader economic malaise for the latter. READ MORE
Excerpt from Business Insider: America's EV plan was flawed from the start. Instead of seeing EVs as one piece of a plan for more sustainable transportation, America has focused on using EVs as a one-to-one replacement for gas guzzlers. But this one-size-fits-all solution fails to address our broader transportation problems, meaning emissions targets are likely to be missed and other transportation problems will continue to go unaddressed.
"The entire myth at the heart of this whole transition is that the battery car seamlessly fits right into the gas car's position," Edward Niedermeyer, the author of "Ludicrous: The Unvarnished Story of Tesla Motors," told me. "It doesn't, and that's the problem."
The EV myth
The mission to replace gas cars with EVs has led to a series of major miscalculations, one of which has to do with the sheer size of the new electric vehicles being put on the road.
Over the past few decades the American auto industry has become obsessed with huge vehicles. The reasons for the size inflation range from profit margins to distorted government fuel standards, but the proliferation of bigger vehicles created a doom loop of consumer preference: Drivers saw the vehicles around them getting bigger, so they wanted bigger cars to make themselves feel safer. Automakers argued that this was proof that people wanted only big cars, so they cut small models and made existing vehicles bigger, which made people with smaller cars feel less safe — you get the picture. Meanwhile, road deaths and injuries soared, while the larger, less efficient vehicles wiped out environmental benefits from higher emissions standards.
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When automakers pivoted to EVs, they focused on the kinds of cars that were already popular — which meant a flood of big electrified SUVs and trucks. But massive-bodied EVs don't make much sense. Larger EVs require bigger batteries, which require more raw materials to manufacture, which requires producers to beef up their environmentally destructive mining operations. While bigger batteries allow drivers to travel farther between charges, they also make the cars heavier, more dangerous, more expensive, and worse for the planet.
The "range anxiety" that has resulted in massive batteries is another reason EVs don't work as a replacement for gas cars. Niedermeyer said that while an electric car can meet most people's driving needs, it struggles with edge cases like road trips because of the need to recharge. Since Americans have been promised a one-to-one substitute for their gas cars, this seems like a failure; an EV should be able to do everything a gas car can. This idea persists even though in 2023 the average US driver traveled only about 40 miles a day, and in 2022 about 93% of US trips were less than 30 miles. Still, in a survey conducted by Ipsos last fall, 73% of respondents indicated they had concerns about EV range.
The focus on increasing EVs' range is contributing to their relatively high prices. Unlike with gas cars, the more you pay for an EV, the more range you can expect to receive. And since Americans have been conditioned to want a lot of range, cars with big batteries and longer ranges have dominated the market, resulting in stubbornly high prices.
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The researcher Benjamin Sovacool and his colleagues have pointed out that, just like in the US, EV buyers in Norway "tend to be in higher income brackets, often using their EV as a second car."
The Norwegian approach has also had a ton of unintended consequences. Joshi told me that the decline in gas tax revenue due to EV adoption had triggered a contentious political debate about increasing road tolls to make up the difference. (A political party was even formed on the platform of stopping the tolls.) Plus, heavier electric vehicles are harder on roads, produce more air pollution, and pose a greater safety risk for pedestrians.
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If the government and automakers are serious about making transportation more sustainable, they should be incentivizing smaller vehicles, hybrid cars, and public transportation like trains and buses.
EVs can be an important part of the fight against the climate crisis, but America's EV plan needs to lean into what these cars do well: short daily trips that can be taken in small, affordable cars. People who frequently take long trips can take advantage of hybrid cars. And better public transit and faster intercity trains could make a huge difference for people and the planet.
While it may be a sexy and industry-friendly approach to the climate crisis, an EV-first plan isn't the most effective way to tackle the enormous challenge we face. READ MORE
Excerpt from Bloomberg: “It all pivoted really quickly,” says Mickey Anderson, a car dealer who’s seen long waitlists for EVs evaporate while battery-powered models pile up at his dealerships in Oklahoma, Kansas and Colorado.
What changed, industry executives and analysts say, is that the initial rush of buyers consisted of wealthy drivers purchasing an extra car for their household because they wanted the latest technology. Now that the early adopters are sated, mainstream buyers who depend on their car as their daily vehicle find EVs “more expensive and less useful,” Anderson says.
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It’s not just the charging network that’s unreliable. EVs had 80% more problems than cars with traditional internal combustion engines, according to the latest survey by Consumer Reports magazine. EV owners reported the most troubles with their battery and its ability to take a charge.
“This has nothing to do with the chargers in the field. This is specifically about a problem with the vehicle where it would not accept a charge,” says Jake Fisher, senior director of auto testing at Consumer Reports. “It’s like you can’t get gasoline into the car. That’s a problem, a big problem.”
That helps explain why more than half of American car buyers now say they’re not interested in EVs, up from just 42% who ruled out battery-powered models in 2022, according to a survey of a quarter-million US car buyers by automotive research firm Strategic Vision.
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But as he stumps for a return to the White House, former President Donald Trump has called Biden’s plan a “a ridiculous all-electric-car hoax” and warned EVs will kill jobs and put American automakers out of business.
“Blue states say EVs are great and we need to adopt them as soon as possible for climate reasons,” Bill Ford, executive chair of Ford and great-grandson of founder Henry Ford, said in an October interview with the New York Times. “Some of the red states say this is just like the vaccine, and it’s being shoved down our throat by the government, and we don’t want it. I never thought I would see the day when our products were so heavily politicized, but they are.” READ MORE
Excerpt from Reuters: Hertz will instead opt for gas-powered vehicles, it said on Thursday, citing higher expenses related to collision and damage for EVs even though it had aimed to convert 25% of its fleet to electric by 2024 end.
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CEO Stephen Scherr had last year at the JPMorgan Auto Conference flagged headwinds from higher expenses for its EVs, particularly Teslas.
Hertz even limited the torque and speed on the EVs and offered it to experienced users on the platform to make them easier to adapt after certain users had front-end collisions, he said.
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"Expenses related to collision and damage, primarily associated with EVs, remained high in the quarter," Hertz said in a regulatory filing on Thursday.
The company, which had earlier planned to order 100,000 Tesla vehicles by 2022 end and 65,000 units from Polestar over five years, said it would focus on improving profitability for the rest of its EV fleet.
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"While 20,000 cars isn't a large number in the total used vehicle market, it does mean Hertz will be taking a major loss on each of these sales while further contributing to the trend of falling used EV values," iSeeCars.com analyst Karl Brauer said.
Hertz is selling some Tesla Model 3 for as low as about $20,000, nearly half the purchase price for the cheapest variant of the compact sedan, its used car website showed.
It lists more than 700 EVs on sale, including BMW's i3, Chevrolet's Bolt and Tesla's Model 3 and Model Y SUVs. READ MORE
Excerpt from Detroit News: Ford Motor Co.'s decision to reduce all-electric F-150 Lightning pickup production is affecting 1,400 jobs in Dearborn. Meanwhile, it's hiring nearly 900 people in Wayne for assembly of Bronco SUVs and Ranger midsize trucks.
The Dearborn automaker in a Friday news release said it’s seeking to balance production to meet customer demand. It says it expects growth for Lightning sales this year, but it’s less than previously anticipated. The production cut is the latest pullback by the automaker in the EV space. READ MORE
Excerpt from The Verge: Edmunds reports that two months after purchasing a 2024 Chevrolet Blazer EV RS AWD for its long-term test fleet, the SUV has been at the dealership for two weeks. With 23 fault codes on a diagnostic test, they wrote that “What we got back from the dealer was alarming: the single longest list of major faults we at Edmunds have ever seen on a new car.”
Things went even worse for InsideEVs writer Kevin Williams, whose weeklong test ended after 28 hours. The vehicle’s CarPlay- and Android Auto-free infotainment system went blank while he was driving, and then an attempt to charge the battery failed, producing a “Service Vehicle Soon” error message.
InsideEVs followed up its initial report, noting owners of other Ultium-powered electric vehicles from GM complaining of unusual and, so far, hard-to-fix issues with their cars. READ MORE
Excerpt from Transportation Energy Strategies: Will the second-hand market be one of the main tools for the massification of electromobility?
Not so soon, though. As for brand new vehicles, similar obstacles block the way:
Price, first. Maybe as a consequence of scarcity, the average price of second-hand electrified models is still significantly higher than for thermal vehicles, 33 grand for a BEV v. 20 for a gasoline-powered car. Or 22 for a diesel-powered car, still popular in non-urban areas, not concerned by low emission zones present and future diesel bans and with a good image of durability and low operating cost. Good ol’ diesel is not dead yet.
Recharge and range anxieties, next. Whether in France or in the U.S., opinion polls concur: 40% of respondents, including present “electro-motorists”, are not convinced that either recharging infrastructure or autonomy are on par with the existing state-of-the-art of the internal combustion engine vehicles (ICEV) ecosystem. Consequence: These are likely to wait and see before crossing the Rubicon to BEV, or will go halfway, toward HEV first, PHEV possibly, both relying on a thermal engine as a solace to autonomy anxiety.
Regarding range per se, it seems the more carmakers boast about progress, battery-wise mostly, the more incumbent motorists ask for more.
Location and ubiquity of recharge, a proxy for cost and competitiveness vs thermal vehicles, and for non-availability of the car, may also prove a near-future hurdle: cheap home-charging (but for how long? Check what happened last November in Connecticut when reality struck that liquid fuel taxes would somehow evaporate) was the fate for most early adopters, less likely to be the dominant model if urbanites or condo dwellers purchase BEVs.
Repairability and battery end-of-life, finally: Several media have been showing scary footage of huge BEV graveyards in China, battery problems not being minor in the decision to wreck those recent vehicles. ICEVs nowadays are resilient and a three-year old car is nearly as good as new when it comes to life expectancy. Is it the case for electrified vehicles, especially considering battery life, a big unknown with little to show in terms of experience curve? Not mentioning the present attitude of insurance companies, systematically recommending scrapping in case of accidents with possible shocks to the battery.
Can climate consciousness, in areas where electricity can really be low-carbon, temporary lower total cost of operation and the fear of low emission zones bans erase these worries? Time will say. For the time being, we note the nascence of a second-hand market for electrified vehicles, another prop for the massification of electromobility. READ MORE
Excerpt fromTechCrunch: “While electric vehicles may benefit the environment, the manufacturing and servicing of these vehicles still generates many harmful waste streams,” San Francisco district attorney Brooke Jenkins said in a statement.
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The complaint, filed January 30 in San Joaquin County Superior Court, stated that Tesla improperly labeled and disposed of materials like “lead acid batteries and other batteries,” paints, brake fluid, aerosols, antifreeze, acetone, diesel fuel and more at its production and service facilities throughout the state. Tesla also allegedly improperly disposed of the waste, both on-site and at landfills that can’t accept hazardous waste, according to the lawsuits.
While the lawsuit was just filed a day ago, the environmental investigation has been a six-year effort. READ MORE
Excerpt from Wall Street Journal: That energy is rapidly fading. Ford is cutting the plant’s output by half, and workers are relocating to other facilities, mostly those making gas-powered pickups and SUVs.
The sudden change “was a little bit of a shocker,” said Matthew Schulte, who inspects trucks at the factory in suburban Detroit. “Reality has set in.”
As recently as a year ago, automakers were struggling to meet the hot demand for electric vehicles. In a span of months, though, the dynamic flipped, leaving them hitting the brakes on what for many had been an all-out push toward an electric transformation.
A confluence of factors had led many auto executives to see the potential for a dramatic societal shift to electric cars: government regulations, corporate climate goals, the rise of Chinese EV makers, and
’s stock valuation, which, at roughly $600 billion, still towers over the legacy car companies.
But the push overlooked an important constituency: the consumer.
Last summer, dealers began warning of unsold electric vehicles clogging their lots. Ford,
, Volkswagen and others shifted from frenetic spending on EVs to delaying or downsizing some projects. Dealers who had been begging automakers to ship more EVs faster are now turning them down.
Even Tesla Chief Executive Elon Musk warned of “notably lower” growth in vehicle deliveries for the company in 2024.
“This has been a seismic change in the last six months of last year that will rapidly sort out winners and losers in our industry,” said Ford Chief Executive Jim Farley on an earnings call in early February.
EV sales continue to grow, and auto executives say they remain committed to the technology. But many are recalibrating their plans.
Ford has pulled back on EV investment and could delay some vehicle launches, while increasing production of hybrids, which run on both gasoline and electricity. It lost a staggering $4.7 billion last year on its battery-powered car business and projects an even bigger loss this year, in the range of $5 billion to $5.5 billion.
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Many were hesitant to pay a premium for a vehicle that came with compromises.
Farley and other industry CEOs are still confident that EVs will eventually take off, albeit at a slower pace than initially envisioned. But for now, the massive miscalculation has left the industry in a bind, facing a potential glut of EVs and half-empty factories while still having to meet stricter environmental regulations globally. READ MORE
Excerpt from Politico: Republican Georgia Gov. Brian Kemp told POLITICO’s Governors Summit on Thursday the Biden administration’s efforts to accelerate the transition to electric vehicles have been “counterproductive” and created public resistance to the technology.
Georgia has drawn billions of dollars in investments from carmakers Hyundai and Rivian for new EV manufacturing plants in the state. But Kemp said President Joe Biden’s legislation that poured billions of dollars into EVs had exposed gaps in the infrastructure needed to support the industry and spawned a backlash against the technology.
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“Most of that was not needed to drive that industry. It was already coming anyways,” Kemp said. “Along with the Biden mandates, it’s really pushed the market too quickly without charging being out there and other things. You look at the rare earth mineral markets, it’s just collapsed, it’s just a mess.”
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Kemp said a slowdown in Biden targets for EV sales would also be a welcome step.
“Anything they can do to undo some of that would be helpful. I mean, the time frames they are putting out there are simply unrealistic,” he said. READ MORE
Excerpt from Detroit News: With gasoline prices dropping, a new study suggests gas-powered vehicles may be more economic to fuel up versus an equivalent electric vehicle.
Entry-level gas-powered cars like the Honda Civic and Subaru Impreza had an average fueling cost of $9.46 per 100 purposeful miles, which are defined as those going to a destination, not a gas or charging station, according to the East Lansing-based consulting firm Anderson Economic Group, which has done business for automakers like General Motors Co., Ford Motor Co. and Honda Motor Co. Ltd.; auto suppliers; and groups like the Nature Conservancy.
Meanwhile, the cost for 100 miles of operating similarly segmented EVs likes the Nissan Leaf or now-defunct Chevrolet Bolt was estimated at $12.55 when charging mostly at home based on U.S. Energy Information Administration energy cost data, which typically records Michigan electricity prices higher than the national average. The cost jumped to $15.98 with mostly commercial charging.
“With electricity prices steady and gas prices slightly down," Patrick Anderson, CEO and study author, said in a statement, "we continued to see most traditional gas-powered vehicles as more economical to fuel than their EV counterparts in late 2023." READ MORE
Excerpt from electrek: The CEO of Toyota isn’t mincing words, saying that he believes EVs will only make up 30% of the US new-vehicle market in 2030, half of the target the EPA sought last year. As the car industry’s largest hybrid pusher, Toyota says it is better positioned to just buy credits to close the EPA gap rather than “waste” money on BEVs, its CEO said.
In an interview with Automotive News, Toyota CEO Ted Ogawa said that the Japanese automaker plans to go with customer demand – and in his view, that’s varying degrees of “electrification,” usually in the form of hybrids with gas-burning engines.
Currently, the company is building a $13.9 million battery complex in North Carolina to be used in its EVs and hybrids sold in North America. Since 2021, Toyota has invested about $17 billion into its US manufacturing operations to build mostly hybrids.
“I know that EPA is now reconsidering what the regulation level should be. However, again, our starting point is what the customer demand should be. So, for example, 2030 regulations said the new-car market, more than half of it should be BEV, but our current plan is like 30%,” Ogawa said. “We are respecting the regulation, but more important is customer demand.” READ MORE
Excerpt from Wall Street Journal: The Biden administration is reviewing California’s plan to ban the sale of new gasoline-powered cars by 2035. To get federal approval, California claims it “needs” this ban to prevent harm to public health from particulate matter—airborne particles like dust, dirt and soot. But banning gasoline cars would do little to reduce particulate emissions, and it could even increase them.
That’s because new gasoline cars are very clean. According to the Environmental Protection Agency, cars emit only about 1% of all direct fine particulate matter in California, and most of those emissions come from older models. The newer gasoline cars that California wants to ban will often have particulate filters that reduce emissions to below one 1/1,000th of a gram per mile driven.
Where do most particulate emissions attributed to cars come from? California speaks as if their primary source is the tailpipe. That was true in the past. But today most vehicle-related particulate matter comes from tire wear. Cars are heavy, and as their tires rub against the road, they degrade and release tiny, often toxic particles. According to measurements by an emission-analytics firm, in gasoline cars equipped with a particle filter, airborne tire-wear emissions are more than 400 times as great as direct exhaust particulate emissions.
California calls electric cars “zero emissions vehicles” because they don’t have tailpipes. That is deceptive. Generating the electricity that powers those cars creates particulate pollution, and of course electric cars still use tires, which are made from petroleum. Electric cars weigh far more than gasoline-powered ones, so their tires degrade faster, as electric car buyers are learning. The same analytics firm cited earlier compared two cars—a plug-in electric and a hybrid. The electric car weighed about one-third more than the hybrid and emitted roughly one-quarter more particulate matter because of tire wear. Total direct emissions went up, not down, when the electric car was driven.
But when California’s air agency analyzed the effects of its ban, it used a model that assumes both kinds of cars have the same tire wear. When the public pointed out the error, the agency doubled down, claiming it would be “speculative” to assume that electric cars will continue to be heavier than gasoline cars. The agency mused that in the future automakers could probably “offset” the weight of heavy batteries with unspecified “weight reduction in other components or the vehicle body.”
California’s bureaucrats have it backward. What’s “speculative” is assuming that electric cars will soon weigh the same as the gasoline cars they replace. Electric cars are 15% to 30% heavier because batteries store far less energy per pound than liquid fuels. While weight differences between electric and gasoline cars have remained roughly constant over the past decade, the only reasonable prediction of trends is for electric cars to get heavier as manufacturers increase battery size to boost range. READ MORE
Excerpt from Forbes: Wall Street placed a hefty bet on the EV industry as if it was a tech company–software on wheels–without knowing much about car customers.
As a recent report in The Wall Street Journal put it, the EV hype and investment of the past several years, “overlooked an important constituency: the consumer.”
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Consumer Reports in its most recent annual auto reliability report, gave EVs low marks for reliability, especially pickup trucks. The survey found that new plug-in EVs have 79% more problems than conventional gasoline-powered vehicles. Plug-in hybrids were even worse, with 146% more problems.
The one standout category was hybrids–gasoline powered engines that are battery-assisted. The cars recharge themselves as they are driven. The survey found that these standard hybrids had 26 percent fewer problems than conventional cars. READ MORE
Excerpt from Associated Press: With U.S. electric vehicle sales starting to slow, Ford Motor Co. says it will delay rolling out new electric pickup trucks and a new large electric SUV as it adds gas-electric hybrids to its model lineup.
The Dearborn, Michigan, company said Thursday that a much ballyhooed new electric pickup to be built at a new factory in Tennessee will be delayed by a year until 2026.
The big electric SUV, with three rows of seats, will be delayed by two years until 2027 at the company’s factory in Oakville, Ontario near Toronto.
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Hybrid sales, however, grew 45% from January through March, while plug-in hybrids, which can go a short distance on battery power before a gas-electric system kicks in, grew 53% according to Motorintelligence.com.
Ford also said it “expects to offer” hybrid versions of all its gasoline passenger vehicles by the end of the decade in North America.
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Industry analysts say most early technology adopters and people who want to cut emissions have already purchased EVs. Automakers now have to convince skeptical mainstream buyers to go electric, but those customers fear limited range and a lack of charging stations.
Ford expects pretax losses for its electric vehicle unit to widen from $4.7 billion last year to a range of $5 billion to $5.5 billion this year. But it foresees commercial vehicles making $8 billion to $9 billion, up from $7.2 billion last year. Gasoline powered vehicles and hybrids are expected to make $7 billion to $7.5 billion, about even with last year. READ MORE
Excerpt from Financial Times: Port and car industry executives have pointed to a pile-up of Chinese electric cars as one of the leading causes of the problem, with some companies booking shipping delivery slots without ordering onward transportation. In other instances, carmakers in general are struggling to order trucks because of the lack of drivers and equipment to move the vehicles on.
“Car distributors are increasingly using the port’s car parks as a depot. Instead of stocking the cars at the dealers, they are collected at the car terminal,” said the Port of Antwerp-Bruges, whose port at Zeebrugge is Europe’s busiest port for car imports. “All major car ports” were struggling with congestion, the port added, without specifying the origin of the vehicles.
Some car industry executives said Chinese carmakers were not selling their vehicles in Europe as fast as they expected, which was a major contributor to the glut at the region’s ports.
“Chinese EV makers are using ports like car parks,” said one car supply chain manager.
Some Chinese brand EVs had been sitting in European ports for up to 18 months, while some ports had asked importers to provide proof of onward transport, according to industry executives. One car logistics expert said many of the unloaded vehicles were simply staying in the ports until they were sold to distributors or end users.
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BLG Logistics, the company that operates the car-handling terminal at the German port of Bremerhaven, Europe’s second-busiest port for vehicles, said it had experienced longer dwell times at its facilities after Germany’s federal government stopped subsidising purchases of EVs in December last year. READ MORE quoted in Jalopnik
Excerpt from AutoBlog: It’s no secret that charging an electric vehicle is often less expensive than fueling a gas car, but many don’t think about the higher purchase prices. A recent iSeeCars study showed that people tend to drive EVs much less, making their cost per mile much higher than that of internal combustion vehicles.
iSeeCars’ research looked at the costs to operate various fuel types between November 2022 and April 2023, finding that EV owners not only drove far fewer miles than gas owners, but their average costs to operate those vehicles over 1,000 miles were much higher. People drove EVs an average of 10,256 miles during that period, seeing costs of $5,108 per 1,000 miles. In contrast, owners drove gas vehicles 12,813 miles, averaging $3,123 over the same distance. The costs per 1,000 miles for other fuel types in the study include:
- Hybrids: $3,056
- Gas Cars: $3,123
- Plug-In Hybrids: $4,351
- EVs: $5,108
EV owners may worry about range and spotty charging infrastructure, which could contribute to the smaller number of miles driven. The higher purchase price of each vehicle is spread over fewer miles, making them significantly more expensive to drive. iSeeCars’ study found an average EV price of $52,387, compared to the $40,009 gas buyers paid.
Higher-end EVs likely played an outsized role in that average price. The most expensive three-year-old model over 1,000 miles was the Porsche Taycan EV, which cost an average of $138,914 when new. The Porsche Cayenne PHEV was second, with an average purchase price of $111,985, and the Tesla Model S was third most expensive, at $96,394.
iSeeCars executive analyst Karl Brauer pointed out that hybrids have become more popular as automakers electrify popular models. They’re also much cheaper to buy than EVs and offer better fuel economy, especially in the city. Brauer predicted that hybrids would become the dominant drivetrain in the industry over the next few years, outpacing gas models as more companies backtrack on EV-only strategies. READ MORE
Excerpt from 1010WCSI/NAFB News Service: During a recent hearing before the Senate Environment and Public Works Committee, EPA chief Michael Regan got an earful from Wyoming GOP Senator Cynthia Lummis as she expressed her displeasure about overreach at the EPA, specifically on electric vehicles and the Biden administration’s push to force their use by regulation.
“The average EV is over $10,000 more expensive than the average gas-powered car, and they don’t work at altitude. They don’t work when it’s that cold. And they don’t work when you can’t get them charged because there are no charging stations.”
Biden’s EPA has proposed tough new auto pollution rules that could force EVs to make up two-thirds of new vehicles sold in the U.S. by 2032. Lummis says this just won’t work for rural communities like hers in Wyoming.
“People in Wyoming frequently drive long distances. My ranch and my farm are 400 miles apart, and yet they’re still in Wyoming. Their livelihoods depend on affordable, reliable vehicles. And that means a gas- or diesel-powered car, truck, or natural gas.”
Biden officials, including USDA Secretary Tom Vilsack, defend EVs to boost manufacturing jobs and reduce climate pollution. Lummis told EPA’s Regan consumers feel differently.
“Judging by the numbers, Americans don’t want EVs. EV sales are around six or seven percent. And dealerships are saying to pump the brakes on electric vehicles. For the good of the country, pull the plug on this mandate.”
The ethanol industry argues hybrid flex-fuel vehicles make more sense. The Renewable Fuels Association road-tested one last year and says it got 440 miles with a full tank of E85 and a full charge—nearly double that of a comparable electric vehicle. READ MORE
Excerpt from Bloomberg: President Joe Biden made a big splash last week when he announced quadruple tariffs – of more than 100% – on electric vehicles from China. Less noticed was his commerce chief’s declaration the next day: sometime this fall, the US will issue an entirely new rule around Chinese EVs – not on trade levies, but on data and cybersecurity.
This has been in the works for some time. Secretary Gina Raimondo has said she raised concerns about internet-connected cars from China during her August trip to the Asian country. In January, she expressed fears that the vehicles scoop up information about drivers and send it to Beijing. After a sweeping policy review, those worries became an official probe.
We’re now knee-deep in the regulatory process, with nary a disagreeing peep in Washington. The bipartisan consensus is that Chinese connected cars, which currently have a near-zero presence on American roads, could pose an existential threat to US national security.
“Maybe it’s a roving spy lab,” Republican Senator Lindsey Graham theorized at a defense tech forum earlier this month. “It’s like an iPhone on wheels,” Raimondo told MSNBC back in February.
Democratic Senator Sherrod Brown has already called for a wholesale ban on “finished vehicles and technology that is designed, developed, manufactured, or supplied” from China.
Chinese carmakers say they comply with laws and regulations wherever they do business, but that hasn’t reassured US legislators.
Underlying all the rhetoric is a basic economic threat to American automakers, whose cars cost about five times as much as Chinese vehicles. Even with tax credits from Biden’s Inflation Reduction Act, US EVs can’t reach the price points of their heavily subsidized Chinese rivals — just ask Tesla Inc. how sales are going in the cutthroat domestic China market.
One potential path around tariffs for Chinese auto firms interested in the US might be to set up factories in Mexico, but Brown’s proposed ban would preclude that approach. US officials have repeatedly said the issues are separate.
The data protection worry, they say, is that the cars are not unlike TikTok, collecting thousands of pieces of information, spanning everything from voice recordings to daily driving routines. Every smart feature, such as drowsiness detection, comes at a small cost of privacy, like allowing the car to know the contours of your face.
In terms of cybersecurity, Chinese EV makers are perhaps more akin to Huawei Technologies Co., which the US blacklisted in 2019 over worries that it could help Chinese spies access American telecom networks.
“Imagine a world where, with the flip of a switch, all those cars could be disabled,” Raimondo said. “Imagine a world where there’s three million Chinese vehicles on the road in America, and Beijing could turn them all off at the same time.” (That comment, unsurprisingly, didn’t go over very well in China.)
But even putting aside the febrile imaginings of EV doomsdsay, discerning the specific risk is a difficult undertaking. On a call with reporters about the probe, an administration official said there was no specific finding or incident that prompted their action. Rather, it emerged from an ongoing review of Chinese tech threats.
My colleague Jordan Robertson wrote last week about a Norwegian researcher who’s analyzing a $69,000 Chinese EV for clues about spying. One challenge, experts said, is that the usual investigative tools simply don’t work. Prying open an EV’s many overlapping systems requires a whole different set of bespoke programs than those used for a PC.
In the meantime, groups from the German automotive industry to Ford Motor Co. to the Korean government are urging the Biden administration to tread carefully, limiting the scope of potential regulations. Because, well, most global supply chains pass through China in one way or another. The automakers say they’ll need time to adjust their operations, a process that could be quite costly.
A top priority for Biden is to issue regulations before Chinese cars ever really break into American markets. The US learned with Huawei networking gear how expensive it can be to decouple with Chinese tech after the fact.
Raimondo made that determination clear earlier this month: The US could pursue mitigation measures, she said, or “we could take extreme action, which is to say, ‘No Chinese connected vehicles in the United States.’” READ MORE
Excerpt from Columbus Dispatch: Consumers should rightly be at the forefront of this conversion. Yet of all the stakeholders involved in the conversation, auto dealers are the only ones talking to consumers—tens of thousands of consumers every day.
Consumers are telling us (Ohio Automobile Dealers Association) they need more time, more confidence, and more incentive to make the switch to EVs, and that’s unlikely to happen according to the federal government’s artificial timeline.
Consumers are concerned about EV affordability.
On average they can be anywhere from $7,000 to $12,000 more than their internal combustion engine counterparts.
Contributing to this disparity, more than half of the EVs for sale today don’t qualify for the full $7,500 tax credit for buying an EV. Many consumers will opt not to go electric based on price and/or incentive alone.
Consumers are also rightly concerned about sufficient and reliable charging infrastructure and acceptable charging speeds. Sure, on an average day, charging an EV may be routine. But what does that look like when you have an out-of-town trip? Or a family driving vacation across the country?
Despite investments in charging infrastructure, fueling an EV remains more complicated, more uncertain, and more unfamiliar for the average motorist. For many, it’s more than they care to contemplate. They opt instead for the familiarity of operating an internal combustion engine or even a hybrid vehicle. READ MORE
Excerpt from CNBC: - Used EVs are now selling for thousands of dollars less, on average, than comparable gas-powered vehicles.
- The difference between the price of a used Tesla Model 3 and BMW 3 Series shows how a “premium” associated with EVs in the initial boom has been erased, according to an analysis from iSeeCars.
- As more EVs enter the used market at lower prices, there is a wider market of potential first-time EV owners.
Back in February, used electric vehicle prices dipped below used gasoline-powered vehicle prices for the first time ever, and the pricing cliff keeps getting steeper as car buyers reject any “premium” tag formerly associated with EVs.
The decline has been dramatic over the past year. In June 2023, average used EV prices were over 25% higher than used gas car prices, but by May, used EVs were on average 8% lower than the average price for a used gasoline-powered car in U.S. In dollar terms, the gap widened from $265 in February to $2,657 in May, according to an analysis of 2.2 million one to five year-old used cars conducted by iSeeCars. Over the past year, gasoline-powered used vehicle prices have declined between 3-7%, while electric vehicle prices have decreased 30-39%.
“It’s clear used car shoppers will no longer pay a premium for electric vehicles,” iSeeCars executive analyst Karl Brauer stated in an iSeeCars report published last week. Electric power is now a detractor in the consumer’s mind, with EVs “less desirable” and therefore less valuable than traditional cars, he said.
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There are reasons why EV premiums are more likely to decline in the used market regardless of the recent consumer perception shift: battery technology is continually getting better, increasing range on new models, and consumers also worry about batteries degrading over time. READ MORE
Excerpt from Newsday/Associated Press: Electric vehicle maker Fisker filed for Chapter 11 bankruptcy protection, the second electric startup to do so in the last year as even industry leaders struggle to lure more buyers beyond the early adapters of the technology.
Fisker Group Inc. said in a filing with the U.S. Bankruptcy Court in Delaware that its estimated assets are between $500 million and $1 billion. It estimated liabilities are between $100 million and $500 million, with between 200 and 999 creditors.
“Like other companies in the electric vehicle industry, we have faced various market and macroeconomic headwinds that have impacted our ability to operate efficiently,” the company said in a prepared statement late Monday. “After evaluating all options for our business, we determined that proceeding with a sale of our assets under Chapter 11 is the most viable path forward for the company.”
The 7-year-old electric car company was founded by designer Henrik Fisker, who has been its chairman and CEO. He designed the company's 2022 Ocean all electric SUV as well as the luxury plug-in hybrid Karma that was launched in 2011. Fisker is also known for leading the development of the BMW Z8 sports car.
Fisker, based in Manhattan Beach, California, and other startups like Lordstown Motors Corp., sought to take on industry leaders like Tesla, and big automakers in Detroit, which have entered the market aggressively.
However, EV sales have slowed as manufacturers have attempted to push electric vehicles into the mainstream. Those sales have been curbed both by a lack of infrastructure, as well as rising inflation that have made taking on car loans more expensive. READ MORE
Excerpt from Motor Biscuit: When temperatures soar, EV batteries suffer. High heat speeds up the chemical reactions inside the battery, which can degrade components over time. This degradation impacts the battery’s performance and lifespan. Additionally, the battery management system has to work overtime to keep things cool, draining the battery even faster.
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Scientific American reported that when outside temperatures hit 95 degrees Fahrenheit, which can happen during a heat dome, using air conditioning can reduce an EV’s driving range by up to 17%. A recent study of 7,500 EVs by Recurrent concluded that range loss in temps above 95 degrees was more like 20-30%. READ MORE
Excerpt from Wards Auto: Dealers may want to think twice before they acquire used electric vehicles.
A study by iSeeCars shows that prices are again in freefall. While electric vehicle values appeared to stabilize at the end of 2023, average prices of 1- to 5-year-old EVs dropped from $33,275 to $30,904 between January and February 2024. That same month, used gasoline-car prices only fell by about $520 (from $31,689 to $31,169).
“It’s that disparity in price drops over the past year that has pulled used-EV values below used-gasoline values,” Karl Brauer, executive analyst at iSeeCars, tells WardsAuto. “Dealers need to keep the ongoing drop in used EV prices in mind when acquiring them because they don’t seem to have hit bottom yet. Dealers should assume they may have to continue discounting used EVs aggressively to find buyers.”
These prices show a major turnaround from a year ago, when the average used EV cost $40,783 and the average used gas car cost $33,469, reports iSeeCars.
Demand for used gas cars grew during the new-car production shortages brought on by the pandemic. This demand pressure is slowly easing, but with used prices hovering around $31,000, they remain well above pre-pandemic levels.
“There’s no denying the crash in used electric vehicle values over the past year,” says Brauer. “We’ve watched EV prices fall between 30 and 40 percent since June of last year, while the average gas car’s price has dropped by just 3 to 7 percent in that same timeframe.”
The iSeeCars study analyzed over 2.2 million 1- to 5-year-old used cars sold in May 2023 and 2024 and found the average used EV price was down 29.5% year-over-year versus 6.1% for the average used gas car price. In May 2024, the average used electric vehicle was priced at $28,767, or 8.3% below the average gas car at $31,424.
“Over the past year the average used price for traditional internal-combustion-engine vehicles has shifted by no more than 7 percent, with prices most months changing between 3 and 6 percent,” says Brauer. “This is in stark contrast to the 30 to 40 percent drops in used EV pricing.” READ MORE
Excerpt from Reuters: Stellantis (STLAM.MI), opens new tab could halt its UK production unless the government does more to boost demand for electric vehicles (EVs) to help it comply with regulations requiring automakers to sell more EVs, the company's top UK executive said on Tuesday (June 25, 2024).
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Unlike the European Union, where automakers can meet CO2 emissions reduction targets by selling a mixture of hybrids and EVs, Britain is demanding from this year that automakers sell a minimum percentage of fully electric cars or face fines of 15,000 pounds ($19,033) per non-compliant vehicle sold.
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"In the UK there will be consequences (of the mandates) for sure," Grazia Davino said. "Stellantis UK does not stop, but Stellantis production in the UK could stop."
This year, the UK government has ruled that 22% of all new cars sold must be EVs. According to SMMT data, fully electric cars only made up 16.1% of sales through to May.
There are still UK tax incentives in place for corporate fleets to buy EVs, but there are no subsidies for consumers to buy EVs that are more expensive than fossil-fuel equivalents.
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Rather than pay fines, Stellantis - home to brands including Peugeot, Fiat, Vauxhall and Jeep - may import fewer fossil-fuel models into the UK to curtail sales and hit the 22% target, Grazia Davino said.
"The fact is that demand is not there," she said.
Like other automakers, Stellantis wants Britain to provide tax incentives for consumers and to boost charging infrastructure, and for the company's UK EV production to count towards its targets, even though some of it is exported. READ MORE
Excerpt from Yahoo! Finance: J.D. Power’s study tracks responses from nearly 100,000 purchasers and lessees of 2024 vehicles within the first 90 days of ownership, and for the first time in the study’s 38-year history, it incorporates repair visit data. Overall, internal combustion engine (ICE) vehicles averaged 180 PP100 (or 180 problems per 100 vehicles), while battery electric vehicles (BEVs) averaged a whopping 266 PP100, 86 points higher than ICE vehicles.
Automakers have typically said that EVs are generally less problematic and require fewer repairs than ICE vehicles because they have a smaller number of parts and systems. However, J.D. Power's study with newly incorporated repair data shows EVs, as well as plug-in hybrid electric vehicles (PHEVs), require more repairs than gas-powered vehicles in all repair categories.
“Owners of cutting edge, tech-filled BEVs and PHEVs are experiencing problems that are of a severity level high enough for them to take their new vehicle into the dealership at a rate three times higher than that of gas-powered vehicle owners,” wrote Frank Hanley, senior director of auto benchmarking at J.D. Power, in the study.
“It is not surprising that the introduction of new technology has challenged manufacturers to maintain vehicle quality,” Hanley added. READ MORE
Excerpt from The Drive: Mercedes-Benz is the latest domino to fall in a long line of carmakers that have seen their EV plans tumble like small tiles, one after the other. The German automaker is no longer planning to be an all EV brand by 2030, and is now pumping millions into further development of internal combustion engines. Mercedes CEO Ola Källenius tells Wirtschaftswoche that combustion engines are going to last “well into the 2030s,” so Mercedes has no choice but to make massive investments into ICE in order to meet stricter carbon emissions rules, according to Motor1.
The changes come as Mercedes reportedly admits that it was overly ambitious with its electrification goals. This has become a common refrain among automakers that are walking back plans to replace ICE models with EVs. Automakers in the U.S. are encountering electrification setbacks that run the gamut from a lack of EV charging infrastructure, to low demand for EVs among buyers. Some of the blame can be placed on the automakers themselves, as in the case of GM, which bungled the release of its massively popular Bolt EV with a string of high-profile recalls. The Chevy Bolt was plagued by faulty battery packs from LG Electronics that ultimately cost GM and its EV partner $1.9 billion.
As more automakers begin to realize that transitioning to EVs is going to be harder than putting out a press release, Big Auto is collectively shrugging its shoulders and revising the timelines that were proposed at the start of the decade. Just three years ago, executives from M-B parent company, Daimler, told Automobilwoche the automaker was “switching from EV first to EV only.” The brass went on to say that every model in the lineup would have a fully electric version, and that Mercedes would switch to a “business without diesel and gasoline engines” by the end of the decade, as Automotive News reports.
The plans seemed ambitious even then, but, hey, everyone was doing it: Opel said it would go fully-electric by 2028; Jaguar by 2025; Volvo and Bentley by 2030; even Ford said it would only sell EVs in Europe by 2030.
Daimler and M-B gave themselves a timeline of nine years to “largely eliminate internal combustion engines,” per AN. Maybe that seemed viable back then, but, in 2024, Mercedes is largely investing in the development of “high-tech combustion technology,” as Motor1 cites the CEO of the German automaker. Hmm. It sounds redundant to say that high-technology combustion technology is the goal, but CEO Ola Källenius was likely referring to engines that must conform to stricter emissions standards around the world.
Mercedes says that becoming carbon neutral by 2040 is still its objective, but it is now investing €14 billion (or $15 billion at current exchange rates) into its passenger car division to meet it. Some of the money will fund advancements of M-B’s electrification (hybrids) and digitalization strategies, but “more money than previously planned” will fund the development of new combustion engines, like those in the upcoming S-Class. The company is also dialing in current combustion engine and transmission combinations to save every ounce of CO2 it can and avoid paying fines once Euro 7 and China 7 regulations go into effect. Because sometimes you have to spend a lot of money to avoid paying a lot more money. Meanwhile, the yardstick keeps moving, and the EV transition keeps being delayed. READ MORE
Excerpt from Associated Press: The mudslide below (Librek) Loha’s plantings of cacao, nutmeg and pineapple have exposed more orange, rocky soil — adding to miles of bulldozed forest and river that are leaving the farm an island of green amid red-brown. Where trees once grew, there are dusty warehouses, mountains of black coal and water that runs silty brown.
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This region of Weda Bay is now one of the world’s largest nickel production facilities. Fiery smelters and multiple coal-fired power plants burn nonstop to refine nickel ore into material for batteries and steel.
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Indonesia aims to dominate the world’s nickel supply, and it’s succeeding. The country has gone from having two nickel smelters to 27 over the last 10 years, with 22 more planned, according to S&P Global Commodity Insights. Last year, the country was responsible for more than half the supply of nickel ore globally. The metal was once known mainly for making stainless steel; now demand has skyrocketed as automakers like Tesla need it for electric vehicle batteries and companies that make larger batteries need it for clean electricity projects.
But where developers build out these vast nickel-processing plants, surrounding forest disappears twice as fast, according to a new analysis by the Indonesian nonprofit Auriga.
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In addition to the new smelters, coal power plants have sprung up to serve the miles of new industrial parks. Surrounding villages can see the well-lit nickel works while they live through regular power outages.
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The new analysis of rainforest loss, based on government data, shows deforestation rose from an average of 33 square kilometers (about 13 square miles) around each smelter, to 63 square kilometers (about 24.5 square miles). If all 22 new plants are built, deforestation is likely to increase dramatically. READ MORE
Excerpt from The Driven: American automotive giant Ford has reportedly bailed on efforts to go all electric in Europe by 2030, describing the goal as “too ambitious” due in part to the “uncertainty” surrounding EV demand and legislation across the region.
Marin Gjaja, chief operating officer of Ford’s Model E electrification division, told British automobile magazine Autocar that the company is no longer planning to end the sale of internal combustion engine (ICE) vehicles in Europe by 2030.
Ford originally announced in mid-2021 that it was committing to transition its entire passenger vehicle range in Europe to be zero emissions capable whilst driving, all electric or plug-in hybrid, by 2026, and completely all-electric by 2030.
The goal was framed at the time as “a commitment to go all-in on electric passenger vehicles, and to substantially grow and electrify our leading commercial vehicle business.”
However, Gjaja, Ford’s EV boss, told Autocar that these goals had been “too ambitious” and that the company will continue to offer a range of hybrids moving forward.
“I don’t think we can go all in on anything until our customers decide they’re all in, and that’s progressing at different rates around the world,” said Gjaja, citing lacklustre customer adoption of EVs which has been fuelled by high battery costs and declining government incentives. READ MORE
Excerpt from Politico: Pennsylvania drivers enjoy an unofficial subsidy for buying an electric vehicle: When they skip the gas station, they avoid the country’s second-highest gasoline tax.
But that’s about to change, after lawmakers this summer voted overwhelmingly to impose a fee on electric vehicles. The idea is to make electric vehicles “pay their fair share,” said Democratic state Rep. Ed Neilson, chair of the House Transportation Committee.
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Right now, he added, “the rest of us subsidize their use of our roads.”
Pennsylvania’s EV fee — $250 annually, once it’s phased in — will be among the most expensive in the country.
But it’s hardly an outlier.
Most states now levy a dedicated fee on electric vehicle owners. Some also have rolled back other incentives, such as New Jersey’s decision this year to restart sales tax on EVs. Or they have reconfigured registration fees to land more heavily on EVs, as in Maryland.
The justification from both Democratic and Republican policymakers for making EVs more expensive is that states are staring down a budgetary cliff.
The gasoline tax — long the backbone of transportation funding — has lost potency as vehicles become more efficient. According to data compiled by the Pew Charitable Trusts, some states collected less from motor fuel taxes in 2021 than during the administrations of George W. Bush or Bill Clinton. READ MORE
Excerpt from Green Car Reports: EV collision repairs continue to cost more than those of internal-combustion vehicles, according to a new report from Mitchell International, which provides tech for the auto insurance and collision repair industries.
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When EVs aren't totaled, though, they cost nearly 20% more to repair than comparable gasoline vehicles, according to the report. EV repair costs averaged $5,753 in the U.S. in Q2, compared to $4,806 for vehicles with a combustion engine. The average repair-cost rates for hybrids and plug-in hybrids were $4,726 and $5,059, respectively, which Mitchell puts down to plug-in hybrids' use of larger battery packs.
The rate of claims for EVs also increased 45% in the second quarter, the report found, although that's to be expected as more vehicles join the fleet and are inevitably crashed. The newness of many EV models is also reflected in a higher use of OEM parts for repairs, at 89% of parts dollars spent compared to 65% for combustion cars.
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However, mechanics spent more time in Q2 appraising EV repairs than those of combustion vehicles, at 8.18% and 5.21%, respectively.
The new report has similar findings to one published by Mitchell in 2023, which found that average repair costs for EVs in the U.S. were $963 higher than comparable gasoline cars. Hertz also cited high collision repair costs as the main reason for slowing its EV plans, and they continue to be a factor in why EVs cost more to insure than hybrids right now. READ MORE
Excerpt from Yahoo! Finance:
In its latest Mobility Consumer Index (MCI), consulting firm EY found that only 34% of US consumers plan to purchase an electrified vehicle (meaning fully electric, plug-in hybrid, or hybrid) as their next car. That's down from 48% in EY’s 2023 survey.
Looking specifically at fully electric vehicles, the number drops to a paltry 11% from 22% a year ago.
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While maintenance costs are lower for EVs, those vehicles have a "much higher magnitude" of costs, said a general manager of a Southern California dealership. That's especially true when it comes to body or structural repairs.
EY’s latest study follows J.D. Power’s EV purchasing survey released in May, which found EV buying sentiment dropped for the first time since the research firm began polling consumers in 2021.
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The popularity of hybrids, and the flexibility they offer, may also be putting a dent in pure EV sales in the US. EY found that 26% of US buyers prefer the flexibility that comes with a hybrid engine, compared to only 19% of global survey takers. READ MORE
Excerpt from The Telegraph/Yahoo! Finance: Falling electric vehicle (EV) prices are leaving a growing number of drivers in negative equity, a top dealership chain has warned.
Vertu Motors said on Wednesday that car retailers were coming under pressure as EVs coming off financing agreements were found to be worth less than the loan they are attached to.
In most car finance deals, this is not a problem for drivers as – provided they have kept up with their payments – they can hand back the keys and walk away.
The lender that funded the leasing deal then typically takes the financial hit.
However, the issue creates a headache for dealers that often allow customers to “roll over” positive or negative equity into new financing deals to win repeat business.
The steep drop in electric cars’ value is being partly fuelled by the discounts offered on new vehicles, as manufacturers attempt to boost sales to hit legally-binding government targets.
Rob Forrester, Vertu’s chief executive, said: “We all know that battery electric vehicles have depreciated at a significant rate, and that tends to feed into the creation of negative equity.
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It follows warnings last month that so-called fleet operators, such as car leasing firms and rental companies, were having to swallow large losses when reselling EVs because of “accelerated, exceptional depreciation”. READ MORE
Excerpt from Bloomberg/Mint: Just a single electric car was on display at this year’s Japan Mobility Show: the Nissan Motor Co. Ariya, on sale since 2022 and first unveiled five years ago. Toyota Motor Corp. and Honda Motor Corp. showed two cars powered by hydrogen, and three models were being displayed for their ability to burn biofuel. That choice seems wildly out of touch with reality. At present, the number of battery EVs sold worldwide every three days is roughly equivalent to the total 90,762 hydrogen cars bought since that technology first came to market nine years ago.
It’s a quixotic approach that seems very much in tune with Japan’s broader positioning as the auto industry goes electric. One in eight cars sold worldwide last year was a battery EV, or BEV, but in Japan the share was just 2.2% — a lower penetration than India or Southeast Asia, not to mention the one in four seen in China. In France, the share was 18%, and 8.1% in the US.
Automakers everywhere are facing plenty of bumps and setbacks on the road to electrification, but Japan is unique in arguing that the shift is not just logistically challenging, but fundamentally misconceived. READ MORE
Excerpt from Autos Today Magazine: Battery Life and Replacement Costs
Typically, electric car batteries last between 8 to 15 years, depending on usage and maintenance. As the battery degrades, it holds less charge, reducing the car’s driving range and efficiency. This degradation can be a significant drawback for those planning to keep their vehicle for a long time.
The watchdog reported that many federal officials weighing the purchase of zero-emission cars for their agencies say gasoline-powered vehicles are more "convenient.” A 2021 executive order from the Biden administration calls for all vehicles acquired by federal agencies to be ZEVs by 2035.
“The cost of [ZEVs] is generally higher for federal agencies than the cost of gas vehicles, largely due to higher acquisition and monthly lease payments. However, peer-reviewed studies GAO reviewed found that ZEVs offer environmental benefits and may offer reduced maintenance costs,” the audit said.
Most vehicles in federal fleets are leased through the General Services Administration and regularly replaced. Zero-emission vehicles are largely electric or hybrid models.
According to GAO, 11 surveyed agencies acquired roughly 5,700 light-duty zero-emission vehicles through GSA in 2023, short of a 9,500 target. The agencies examined by GAO range from the U.S. Army Corps of Engineers to the Federal Highway Administration. READ MORE
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