“Why can’t you be more like Tesla?” That’s what Wall Street investors have spent years demanding of the traditional automakers. So then Ford takes their advice, tries a Tesla tactic… and it immediately backfires.
That unfortunate situation leads off today’s morning roundup, along with several rounds of important Nissan updates and a dispatch on how Great Britain’s car industry may not be dead quite yet.
Lightning Doesn’t Strike On Wall Street
This week, Ford pulled a Tesla move and cut the price of the F-150 Lightning by nearly $10,000, putting it close to price parity with gasoline trucks—a long-sought goal for just about every automaker trying to make electric vehicles financially viable. You’d think the move would project confidence among Ford’s investors in its manufacturing methods, its ability to scale batteries and its commitment to an electric future, which is part of why Tesla’s valued so highly. (Another big part of it is Elon Musk’s continued claims that the company has basically “solved” self-driving cars, which is untrue and has been untrue for almost a decade now.)
You’d be wrong! Bloomberg reports that in the wake of this price cut, Ford’s stock price took an immediate bath:
“Everyone loved it when Tesla did it,” said David Whiston, an auto analyst at Morningstar. “As long as they’re truly making improvements in production costs and input costs, then giving some of that back to the consumer makes sense.”
Investors didn’t see it that way, sending Ford shares down 5.9%, their biggest drop in five months.
Oof. And since you’re probably asking why:
“Investors fear this fits recent noted theme of higher US EV inventories,” Chris McNally, an Evercore ISI analyst with the equivalent of a hold rating on Ford shares, said in a report Tuesday. “Time will tell if the Ford price cut was demand or supply,” he wrote, adding that it’s likely a bit of both.
Then again, fears around demand are part of why Tesla started slashing prices at the beginning of this year. Those price cuts have paid off massively both in the U.S. and China, helping (along with favorable tax breaks) to maintain Tesla’s sizable lead in the EV market despite increased competition. Tesla, in case you’re curious, remains the automaker with the biggest market cap by an extremely wide margin.
But investors must see the question of EV demand differently for companies like Ford, apparently because it raises tough questions about its core product:
Ford is counting on demand for combustion F-Series trucks — the top-selling vehicle line in the US since the Reagan administration — carrying over to the electric versions. In addition to targeting a 150,000 annual run rate of F-150 Lightning output after its Michigan factory reopens next month following a few weeks of downtime, a second-generation electric pickup will go into production starting in 2025. The new factory for that model, sprouting up in Tennessee, will have the capacity to make half a million vehicles a year.
That’s what may have been most unsettling of all about Ford’s announcement for investors — that the company would drop prices this much and this early in its transition to electric trucks.
One quarter of weird EV sales and everything goes to hell. I dunno, it’s almost like all of this stuff is made up.
Either way, a price-cut Lightning Pro is probably a great deal right now, despite what a bunch of guys in fleece vests think.
Tata Delivers Giant Win For Britain’s Car Industry, Announces $5 Billion Battery Factory For JLR
The British car landscape has been a pretty bleak one since… well, it’s felt almost frozen in that state since Combat Rock came out. Over the decades it’s been nationalized, downsized and seen its storied brands sold off to foreign ownership. Brexit accelerated that downward spiral as the remaining companies manufacturing in the UK faced trade tariff uncertainty that made production there feel increasingly untenable. Nissan, Honda, Toyota, BMW and Jaguar Land Rover have all started quietly ghosting the country since the middle of the last decade.
Now, Tata—JLR’s Indian parent company—announced an electric lifeline that will be welcome news to Great Britain’s flagging auto industry. It’s getting a $5.2 billion battery factory for future JLR cars that’s due to bring some 4,000 new jobs, reports Bloomberg:
JLR and Tata Motors Ltd. will be anchor customers for the plant capable of providing 40 gigawatt hours worth of batteries with supplies starting from 2026, according to a statement. The factory could supply roughly half a million vehicles per year depending on the size of the batteries.
The decision marks a significant victory for the UK government, which fended off competition from Spain for the factory. Britain’s auto industry has been struggling to compete with generous incentive packages for green technology in the US and European Union.
The UK’s car manufacturing sector, once a core part of the economy, has been struggling to cope with Brexit and the shift to electric vehicles. The company at the center of a proposed battery factory in the northeast of England, Britishvolt Ltd., fell into administration earlier this year.
European carmakers have been raising the alarm over upcoming tariffs on electric vehicles shipped between the UK and EU, unless much of their parts come from within the region. UK officials have not yet persuaded Brussels to delay the deadline.
JLR also has a big $18.7 billion electric push in the works that includes Jaguar trimming models and going way upmarket, as well as a fully electric Range Rover. It’s going to need to prove it can compete in a more connected, automated and alt-powertrain future, and so far all we’ve seen of that is the aging I-Pace. Which is still on sale! Wanna spend $80,000 on one of those?
Nissan Goes Tesla, Too
It hardly feels like news at this point, but yet another automaker has announced a switch to Tesla’s North American Charging Standard plugs, and it’s a “big” one. Nissan will go the way of Ford, General Motors, Rivian and Volvo and on a similar timeline. Here’s what the company said in a news release:
From 2024, Nissan will make available a NACS charging adapter for Ariya models which are currently equipped with the Combined Charging System 1 (CCS1) for DC fast charging. This will enable customers to connect their vehicle’s charging port to NACS plugs at compatible chargers.
Starting in 2025, Nissan will begin offering EVs for the U.S. and Canadian markets with a NACS port. This will make charging on the Tesla Supercharger network seamless and convenient for drivers, significantly increasing the number of public fast-charging locations at which Nissan EVs can be charged1.
“Adopting the NACS standard underlines Nissan’s commitment to making electric mobility even more accessible as we follow our Ambition 2030 long-term vision of greater electrification,” said Jérémie Papin, chairperson, Nissan Americas. “We are happy to provide access to thousands more fast chargers for Nissan EV drivers, adding confidence and convenience when planning long-distance journeys.”
I say “big” in quotes because Nissan’s a major automaker that sells a ton of cars in the U.S., but it dropped its early lead in the EV race after the second-generation Leaf came out. It’s pinning a lot of hopes on the Ariya, but that too has had some production problems. Making electric cars is hard.
But Nissan And Renault May Finally Have A Deal
Part of the above problem is that a lot has seemed on hold at Nissan while it figures out its weird, sometimes uncomfortable live-in-separate-bedrooms marriage to French giant Renault. Like a wealthy couple who have messed around on each other a few times, there doesn’t seem to be a tremendous amount of trust between the two, especially after the scandalous ouster of Carlos Ghosn and Nissan’s own attempts to seize more power in the relationship. Besides investments in one another, a lot is at stake here, like intellectual property, chip and battery joint ventures and other complicated matters related to future tech.
But! They may soon be able to get back on the road together, reports Reuters:
Nissan and Renault will make an announcement in the coming days on their restructured alliance and have finalized the deal, three people familiar with the matter said, capping 10 months of sometimes tense negotiations.
The automakers announced a framework agreement in February and had aimed to finalize negotiations as early as March. Under the framework, the Japanese automaker would take as much as 15% of Renault’s new electric vehicle unit, Ampere, while Renault would reduce its 43% stake in Nissan.
[…] Renault wants to attract more investors to Ampere, given the massive investment required for connected cars. Nissan and Renault’s junior partner, Mitsubishi Motors, has also indicated it may invest in the company. U.S. chip giant Qualcomm has already said it will invest.
Discussions have focused on how to deal with future IP – including technology that may not yet exist, one of the people said. A Mitsubishi spokesperson said it was still considering investing in Ampere but that nothing had been decided.
As for Ghosn, he’s still a fugitive in Lebanon (which has no extradition treaty with Japan), waging a $1 billion lawsuit against Nissan and talking shit for days, according to Automotive News. And he doesn’t seem optimistic about this new deal between the two:
He pointed to the long-delayed completion of a Nissan agreement to invest in Renault’s planned electric vehicle spinoff as a sign of festering distrust and withered ambition.
“After my arrest, the alliance was shattered,” Ghosn said.
“The only thing you can do is to restart something less ambitious, much more restricted,” Ghosn said via video link from his home office in Beirut. “And now what they’re trying to do with this latest agreement is trying to go for a mini alliance with a very reduced scope of cooperation.”
Ghosn’s hardly a neutral observer here, but he certainly knows what he’s talking about.
Your Turn
A lot of this TMD today has been about the struggles of legacy car companies to prove themselves in an era when so much is changing with EVs, connected cars and autonomy—but those same companies are subjected to the whims of thirsty shareholders every quarter. This, despite the massive investments needed to survive in the future, whether it’s fully battery-powered or something else.
So who’s best positioned to go into the next era of cars? Who’s doing it right these days and who do you worry about?
My stock market pick is Toyota. Be more like Tesla doesnt mean do what Tesla does a year later. But yeah i took a business class in college and during a few minutes i was awake they stated for the most part the 1st company to do something usually fails, but the 2nd aor 3rd learns from it and succeeds. Now Musk is a unmeasurable. I bet Toyota pulls a head with perfect reliable hybrids so doubters buy in because the early accepters cant keep buying and 20x the amount of current buyers have to buy in.
So, it sounds like the people thinking a $60,000 electric truck would sell like hot cakes…
Found Out Reality Disagrees
Globally, VAG seems to be sitting pretty. Controlling market share for everything west of Rhine in Europe. Just a nice fat block of states regulating EV adoption and a population that can pay for it. Also the largest market share in Chile, with a significant infrastructure in place, for easy access for that sweet, sweet lithium. Europe also seems like challenging for Tesla expansion, so probably the furthest from having to compete directly in the money maker. Plus cash to set on fire. Friends at Porsche to actually make it work. And a large G8 nation who is directly intertwined with the cooperation to pump cash in coffers whenever it dips blow swan dive-able. They are probably screwed in the US market, but that’s looking like a cash burning knife fight, so might end up being blessing.
Actually, VAG is in real financial trouble https://www.wardsauto.com/industry-news/volkswagen-ceo-schaefer-managers-roof-fire
The problem with EV’s is the government mandate. You can’t make somebody like something or change for that matter. People have to like it/want it first. Ford thinks it can transition all F150 drivers to an electric lightning. That’s like trying to make a Chevy guy buy a Ford…good luck. Tesla will maintain it’s niche market no matter what it does. (No model changes, sketchy build quality, empty promises but an ok electric sedan that’s a great secondary car for people with money or if they took the red pill)
Government should back off, lay off the subsidies and let the market become what it will be.
The point of the tax credit is to offset the price difference between current ICE vehicles and EV’s. 99% of people don’t “like” or “dislike” EV’s (or ICE cars for that matter), they will buy whatever they think will be the most convenient and economical for them, because it’s an appliance to them at the end of the day.
Really all that subsidy money should be funneled into the charging network, that’s the real bottleneck for mass adoption.
I don’t think the subsidies are at all necessary. All they do is allow the manufacturer to raise the price to match the subsidy. The manufacturers simply need to build inexpensive EVs designed to wring as much range as possible from smaller battery packs. But there’s not nearly as much profit margin in that…
I remember in the 1990s when the gold standard for getting a 200 mile range was a 25-30 kWh battery pack, and there were a number of prototype sedans that did just that, offering up the “promise” of a $20,000 sale price if they could be mass produced. The major automakers simply weren’t interested in that. The laws of physics haven’t changed since then, but the batteries have gotten a crap ton better, and cheaper, since.
Except that Tesla and several others actually reduced their car prices to meet the subsidy cap.
This is why the subsidies have a price cap ($55k for cars, $80k for trucks/SUVs), and why as technology improves, both the cap and the subsidy, should be reduced.
We could definitely debate the current cap level, which I will agree is too high!
Unlike the other manufacturers, Tesla has a lot of fat they can trim. They’ve been mass producing EVs for more than a decade now, and have recouped the non-recurring engineering costs and tooling costs. EVs actually could be cheaper than ICE cars to manufacture in mass production and over the long term, including their expensive battery packs.
If the incentive couldn’t be eliminated outright, I’d cap the MSRP of the car at $20k, with the stipulation that the car must get at least 200 miles range on the EPA highway cycle AND at a steady 70 mph on flat ground with a specified temperature/humidity/air pressure. This would provide real incentive to get an affordable EV onto the market that the common person can afford, and it would be next to impossible for a manufacturer to take advantage of the tax credit by raising the vehicle’s price, simply because of the manufacturing cost of the car dictating narrow margins at that price point.
In turn, Joe Sixpack could walk out the door with a long-range EV for $12,500, cheaper than a stripper Mitsubishi Mirage, with a monthly payment that may very well be smaller than the amount of money he’d save not buying gasoline when displacing the miles travelled in an ICE car.
Stop making sense!
I am not sure they can say the production levels were massive. in fact even now the quantity put out is pretty small compared to many car mfrs
Having no government (i.e. “we the people”) role in the market (incentives/penalties), for anythying in the market, is the same as saying, “I think Billionaires should have more money, and that the Earth should be LESS livable for common people.”
I’ll second the point too that most people don’t like or dislike EVs. If the technology is pushed to where it has comparable or better functionality, no one will care what is in the drivetrain.
Tesla the niche market that has the Model Y as the best-selling car in the world.
The government forces us to buy all kinds of stuff like who we can get internet access from. Who we can buy cars from in most states along with a whole host of other items.
As for a BEV being a secondary car, that was a decade ago. I drove my car to the middle of nowhere Idaho. 600 miles each way. No problems.
The BS about sketchy build quality for Tesla is so outdated its embarrassing when someone mentions it still like Kia and Fords aren’t catching fire in garages.
Covid taught a lot of people they don’t need to drive much more than about a thousand miles a year.
I’d rather the subsidies (my taxes) went into public transport. I’ll drive when it’s fun to drive.
I don’t really worry about any of the legacy automakers, too big to fail, right? It might take time, but they’ll make the transition and survive.
For domestic manufacturers, I think Ford has the best shot in the EV transition. The Ford family still has the majority of the voting power at Ford. If they stand behind Farley, he can piss off all the other investors as much as he needs to. He can also lean into the truck/SUV profits to offset the current EV losses. Tesla needed to sell emissions credits to offset their losses until they figured out how to take enough cost out.
GM should have had the lead after the EV1. They could have been the EV leader if they kept the EV R&D going. But they squandered their position and are playing catch-up.
Globally, Kia/Hyundai are closest to Tesla in terms of EV architecture. If anyone makes a ‘Tesla Killer’, it will be them.
Tesla’s party tricks are EV efficiency, profit margin and the Supercharger network. Literally every other auto manufacturer is better at car building fundamentals than Tesla (I currently own a Model 3). Once the other OEMs catch up on EV architecture and margin, Tesla will become an EV charging company with a side business building cars.
You forgot software. It’s what’s behind the three things you mentioned.
It’s easy to forget about something that just works!
Tesla has barely scratched the surface of EV efficiency, and just doing so makes them a generation or two ahead of the competition by default.
Aptera, on the other hand, gives us a real glimpse of what is possible. Sub-100 Wh/mile consumption at 70-80 mph is a reality, and is also possible in 4-wheeled sedan form.
I’m sure Tesla is aware of this and when they need a new party trick, would be willing to do something drastic that the legacy automakers never would, for fear of giving up planned obsolescence.
For Detroit: GM is in a wait and see period. They’ve got products in the pipeline that will help them gain scale with their platform. They’re expecting those to help reach profitability with $40k EV’s. Stellantis is betting on PHEV’s to bridge them for the next five years. Ford is a basket case. The Mach E is a worse Model Y and the Lightning seems to have lost its first mover advantage. Although if sales pick up and they can scale to break even, that would be a great outcome for them. Rivian just got a big win for their second generation plant so they’ll be okay IMO.
Globally the Koreans are killing it. They have the right products. Now if they can localize production to get some of that tasty government cheddar, they’ll be in an even better spot.
Vinfast is stumbling with a rushed product. But it’s nothing that can’t be sorted with money and further refinement. I hear Italy has several good tracks. So does California. Rent one for a week and benchmark some competition. Invite Joe/Jane Q. Public to test their vehicles alongside other CUV’s. Even better hire a consultant to run the event to avoid VinShenanigans. Take the report to heart and address the shortcomings. Nobody likes criticism, even if it is constructive. But to sell vehicles here they can’t be making people carsick!
I think the automakers that will do well are the ones that are able to innovate, and are not saddled by legacy thinking. A few months ago, I caught a brief bit of a Sandy Munro talk, where one thing he talked about was that many legacy automakers are still following internal design standards from the 1950’s, and any new idea that doesn’t fit the standard is not used. The new startups such as Tesla and Rivian do not have this problem, and are not design constrained by old thinking. Any legacy automaker has the opportunity to move towards clean sheet design, instead of trying to shoehorn new technology into old design methodology, but I’m not sure many are doing this. The Koreans are newer to the game, so seem to be doing better in this aspect, same with the Chinese (maybe this will help Volvo?). Considering the extreme lack of innovation I have seen in my own experience with the Japanese, I wouldn’t be surprised if they become largely irrelevant in the future. The US and European manufacturers still seem up in the air, where they certainly have the talent and capability to innovate, but appear to be held back by management.
Tesla’s huge profit margin (due to their streamlined manufacturing process) allows them to cut prices and still eat everyone’s lunch. I dont know what Ford’s profit margin is on the Lightning, but while Tesla grosses $16k on each car, Ford only pulls in $3k across their lineup, I’m pretty sure Ford is taking a loss on Lightnings.. Thats why stockholders aren’t happy. Ford isn’t Tesla.
Perhaps Mr. Farley doesn’t posses the same command of bullshit that Mr. Musk does.
Have you looked at Tesla’s financials? No bullshit needed, they’re raking it in 3-5x more per car than any other automaker.
but they produce what 5-6 times fewer vehicles so is it really that big of a deal. Once scaled to Ford size Tesla will not be seeing that.
Their profit margin has only gone up with their increased production. Their goal is to own the entire supply chain of parts. They went from $3400/car in ’20 to $16k in 2022. Their net profit went from losing money in ’19 to $.7B in ’20, $5.6B in ’21, $12B in ’22. If you watched their last shareholder meeting video they explained how they plan on owning the supply chain with R/D, cost, parts, all going down while efficiency going way up for each build. It has to plateau at some point, but I dont see it going down any time soon.
The ironic thing is that Tesla is basically using Henry Ford’s original business model of vertical integration to beat the crap out of… Ford. Huh.
No kidding.. Using Ford’s vertical integration plus turning the entire manufacturing process on it’s head to make things as efficient as possible. Their assembly process is unlike any other manufacturer, shrinking the hours it takes to produce each car, allowing them to crank out even more for less cost.
The industry needed this.
This is the big takeaway here. Tesla’s market cap has been far beyond reason for a long time. Carvana being up 35% today is nonsensical. The stock market is bullshit and completely detached from reality.
The quarterly return bullshit has completely screwed our economy, we will never have another Bell Labs or Xerox in the USA.
I hope the coffee is stale and cold in hell for Jack Welch
Look at GE today. History has spoken on Welch’s legacy.
Think it may be the foreign auto makes best suited to survive, as some(most?) seem to have their respective government’s backing/incentives. Ford in particular is having a time with it all. I used to like Farley as a CEO but the last year or so he seems to be more smoke less substance. GM seems to be a little more pragmatic so may not do as bad.
Hyundai/Kia and Volvo seem to be in great positions when it comes to the transition to EVs. Both companies rolled the dice on the technology early and it’s paid off significantly. They have viable EVs, PHEVs, and plenty of hybrids…not to mention forward thinking styling and tech features to match. The Volvo EX30 is about to be a total game changer and I don’t think the current slump that the Korean EVs are in will last forever. I think prices will come down a bit, they’ll figure out ways to get some of those sweet sweet tax breaks, and that their second gen BEVs will be on the cutting edge.
I don’t trust Ford. They have too many QC issues, they’re pulling all sorts of nonsense when it comes to manipulating the supply of their own products, their CEO lies through his teeth constantly, they can’t fulfill the orders they take, the list is long. Ford had a real opportunity to get ahead of the curve and they absolutely shat the bed. They have no one to blame but themselves.
GM has a chance to catch up in a big way, but they appear to be chugging laxatives in preparation for their own catastrophic bed shitting. Canceling the Bolt was unbelievably stupid, even for GM, and we all know damn well that they’re going to try the OH NO WE DID A LITTLE WHOOPSIE OUR NEW EVS ARE GOING TO COST $80,000 TE HEE HEE just like every greed drunk corporation does these days.
That being said it seems as though they’ve somehow managed to create a pair of cheap cars that don’t suck ass with the Envision and new Trax…and there’s a gaping, bleeding hole in the market right now when it comes to affordable cars that don’t suck ass. There’s a non zero chance that they move enough volume of those to make a decent profit. Basically this is a roundabout way of saying GM is probably going to pass Ford if they can avoid shooting themselves in the dick repeatedly. But when have they like….ever done that?
Tesla is setting up its full revenue stream by having OEM switch to their plug. Tesla will just make even more charging stations.
Ford is struggling with its products, GM is only putting out halo vehicles. I think Hyundai and Kia are setting themselves up right. Mazda might die here in the US
Ford might have something if they’d do a PHEV version of the F150. If they ran a P2 (motor replaces torque converter) or maybe P3 (motor connects to the tailshaft of the transmission) hybrid setup with the Mach E 280-ish HP motor combined with the 2.7 ecoboost and a ~10-15 kWh battery, they could have a 40-50 mile electric-only range truck that would drive just fine around the city, but when you want to tow or cruise long distance it’d run just like a regular F150, except better.
The powerboost hybrid they have now doesn’t make sense to me – the 3.5 ecoboost is already burly, it didn’t need more performance help. And of course as usual they have it priced too high…
The hybrid was a bit cheaper before the Lightning came out right?
Yeah, all of the PowerBoost mechanicals, but with the base V6* and a larger battery with a plug would be a really nice package. I have to imagine there’s somewhere for the battery to go, but, even if there isn’t, it’s a pickup truck – just put the battery in the front of the bed, build one of those truck bed storage boxes around it, and voila – it’s out of the way, it’s extra lockable storage, and, from a design/manufacturing standpoint, it should be easy to make it work with the various cab & bed combos.
*I’m going with the base NA engine here, to minimize cost, complexity, and weight of the fossil-fuel side.
So, India rides to the rescue of the UK? The Charge of the Light(ning) Brigade, perhaps? (I predict a much better outcome for this venture, though.) It’s great to see India making good and providing a comforting arm for Britain to lean on, even with all the bad blood between them in the past.
That is pretty funny, I will be watching this with great interest.
Don’t forget that when Tesla cuts prices, they’re still making money (although less). When Ford cuts EV prices, they losing even more money trying to buy market share. It’s not necessarily a terrible plan, but losing more money isn’t the sort of thing that thrills investors.
Yeah I think that’s a big factor here that isn’t really considered or touched on – dismissing it just to “magic.” Ford, a company that makes money in their traditional business, has been burning through stuff on EVs thus far without much momentum to show for it. Like you point out, Tesla still makes money on those cars and has shown huge numbers recently with that tactic.
Tesla “making less” with their cuts is still 3x more than Ford’s entire ICE lineup. The Lightning is losing money, no doubt.
Eventually the market will notice that Tesla’s been coasting for years. All their big, brilliant innovations are in the past, and I suspect the minds who produced them have left the company. They were smart, though, to delay the Cybertruck. If they had rushed it into production it would probably have been a huge flop and could have ruined the company. Now, even if it’s a disappointment, nobody cares anymore.
However … nobody avoids disaster forever. Someday they’ll have their Edsel and the vibes will evaporate.
This is absolutely what is going on inside Tesla.
When Steve Jobs died, people assumed Apple would slowly fade into irrelevance again. While I would say they haven’t innovated anything significant (Apple Pencil, Apple Google Glass but uglier) since he shuffled off his mortal coil, they are worth more today than ever. I keep waiting for the bottom to fall out, but they just keep chugging along.
Similarly, I assumed once the legacy automakers begin to produce electric cars, their decades of experience and QC would produce a better product and Tesla would fade away. Clearly this has not been the case.
Legacy auto has a long-established profit model with ICE vehicles. They don’t want to sell anything but ICE vehicles for that reason. Every EV they sell is one less more-profitable ICE car sold. They all wish EVs would just go away. Tesla doesn’t have that problem. As long as legacy auto is competing with itself in this way, Tesla will have a big advantage. They’re not coasting, and won’t be for a good while.
As I’ve said here many times, Toyota’s cautious approach is the one I would bet on.
All-in on EVs right now when both the cars and the infrastructure have serious limitations seems crazy.
The ones who are all-in (Volvo, VW, etc) I don’t really “worry” about, because I wouldn’t shed a tear if either went bankrupt tomorrow, but I do think they will need to strike lightning in a bottle with a battery breakthrough, publicly backtrack from their combustion-free stances, or face increasing irrelevance.
Agreed, my money is on Toyota and Hyundai/Kia. The big US 3 will be fine, as long as they keep chugging out those massive gas guzzling trucks to pay for all of their other follies.
VW sure, but Volvo? They’re a Euro/US coachbuilder on top of a Chinese manufacturer – I’m not sure they need to do anything around the batteries since the Chinese parent is going to keep building them no matter what.
They are very public with their “no more ICE” stance.
I just don’t think that’s going to fly in the short to medium term, at least in the US.
Who knows what’s really going on with the Chinese economy, but it sure seems like nothing good.
You’re right that bankruptcy is probably off the table, but I could see them reduced to even further irrelevance.
Yeah but Volvo isn’t going to be selling very many cars in the US anyways and given Tesla, we know there’s a decent market for EV only brands.
Toyota’s approach is cautious but it looks like a mistake (for now). Sales of “electrified” cars are going up pretty rapidly all over the world which could be good for Toyota except that PHEV sales are just collapsing, which makes sense if you think about it.
A lot gets made of how impractical BEVs are for apartment dwellers but PHEVs are even less practical – there’s not enough range to justify hauling around a heavy battery, so these buyers will gravitate to legacy hybrids (which I think are mostly vanishing), ICE or BEV. Depending on where they live, a BEV isn’t always less practical than an ICE.
For people who have a garage in the US, in all probability they also have a 2nd car and that car is probably an ICE. PHEV would make sense if it’s the only car they have but since they’re looking at a 2nd car, there’s very little benefit to getting the PHEV over the BEV.
So we’re left with Toyota being heavily invested in a transitional product whose time has passed (for good reasons). Which explains some of the panicky stuff they’ve been doing of late.
I think there is a cap on the number of early adopting people who are able and willing to make an EV work with current technology, and that it is smaller than many people believe or want to believe. Hence flattening sales, lots of inventory, slashed prices, etc.
Despite all the hype, despite all the marketing, the breathless reviews, the fawning, the tax credits, and everything, 94-95% of US buyers took home a vehicle with a combustion engine in 2022.
Whether or not someone *could* make an EV work as a second car, or even as a primary car, is not the same as whether they are willing to spend real money on one.
We’re at what, a quarter of all new car sales in CA as a whole? Geography specific obviously, but I think we’re past the early adopter phase.
Trying to gain the favor of Wall Street has always been a fool’s errand. They’re like that popular kid in high school, with as much sense of entitlement and lack of perspective. Fickle and capricious, appreciating only those whose vision and behavior is as antisocial and myopic as their own. I’ll leave it up to you to guess who I’m referencing.
The worst thing we ever did was create an economy that lives and dies on the whims of people who don’t contribute anything to a company’s output.
100% this.
Wall Street, where your company’s net worth is made up and points don’t matter.
I award you 2000 points for this answer!
2000 options for points, vesting after one year and only executable on the third Thursday after a full moon.
So you’re saying Wall Street is like an improv comedy show?
Yeah, that checks out.
Who am I worried about? Mazda.
I’ve owned several and loved them all. And I’ve seen some really cool things coming from them.
But in a world steadily moving toward electrification, they are getting left behind and steadily marching toward irrelevance.
Don’t worry just yet. Legislation and reality are still multiple decades apart.
That is a great way or putting it
“Legislation and reality are still multiple decades apart.”
In many markets like the EU, ICE vehicles will become unsellable starting in 2035:
https://www.energyintel.com/00000187-28b5-df45-a9df-7cf51aac0000#:~:text=The%20EU%20will%20officially%20ban,Council%20adopted%20the%20proposal%20Tuesday.
Same deal for CARB states.
Same deal in Canada
So no… they don’t have ‘decades’. At this point, they have 11.5 years to come out with some good BEVs and figure out how to build them cost effectively in high volumes.
“Ghosn’s hardly a neutral observer here, but he certainly knows what he’s talking about”
I’m going a hard NO on this.
Ghosn’s bad choices are what triggered the problems between these companies! Not to mention Japan’s revenge
Well, I meant more that he knows the inner workings of these companies more than just about anybody. But he’s got axes to grind for the rest of his life.
From what I have read, he wasn’t exactly pure as the driven snow…he was buying houses and paying for family weddings on the company dime as well as flying all over the world on the company planes. Both Renault and Nissan are better off with him gone.
Like certain defeated politicians, he is struggling with his new irrelevance, so has to try to stay in the headlines.
I will say this is where Ford needs to also take the Tesla model of disregarding wall street. I actually aplaud Ford for taking back the price hikes they have added in the past year. It kind of feel like the big box store that raises prices just before a labor day “sale”, but if the actual public can get a Pro with a 300 plus mile battery for around 50K out the door then I am even sort of interested, and I am never interested in EV that often. Plug in Hybrids like the 4XE and E-Ray corvette, yep, that seems to make sense with current infrastructures, but lugging around 3k lbs of batteries and still having to wait at least an hour to continue to make it to the lake seems like a bad deal.
Ford is just Lightning money on fire.
shocking take…
Someone came charged to make EV puns today.
I award you thunderous applause
When the Lightning was announced the public was electrified, but lately sales have fizzled. Perhaps the price cuts will be the jolt ford needs to energize their sales.
I feel like you’re Mach-Eing them
Indeed, they kicked themselves in the family joules
That’s *good*
This struck me as funny.