Now that another weekend of Fancy Person Things® at Monterey Car Week is in the books, it’s time to return to reality: an auto industry disrupted by batteries, software and labor disputes over things like batteries and software. Good Monday morning, Autopians! Time to rise and grind.
We kick off this late summer week with news about how General Motors is fixing its slow electric vehicle rollout; how Hyundai and Kia are hatching similar plans in America; the way Tesla plans to “lock” its true battery capacity with software; and the fight over wages in all of these new battery plants.
I’d almost apologize for going so “tech” heavy today, but as you know, I don’t make the news. I just tell you about it. Gimme a beat and let’s get nasty.
GM On Slow EV Rollout: We’re Working On It
Have you seen the Barbie movie yet? I thought it was delightful. (And maybe the best thing Ryan Gosling’s ever done.) But in addition to launching a Mattel Cinematic Universe that nobody asked for, it’s also so rife with GM EV product placement that a few scenes feel like a TV commercial; the Chevy Blazer EV SS crossover, in particular, figures pretty heavily into the film.
There’s just one problem: you can’t even buy it yet. That particular model is said to go on sale in the spring 2024, and it’s already been delayed. Same with the new Silverado EV. The Cadillac Lyriq doesn’t seem to exist outside of Detroit-area press fleets, and the GMC Hummer—an inherently limited-volume car due to its price and size—has been rife with problems. Earlier this year GM was touting the fact that “all” of its EVs would qualify for the new tax credit, but the vast majority of those cars aren’t even in production yet.
GM’s made a lot of big electric promises but so far it’s been slow to deliver. But it makes sense why: besides setting up a whole new supply chain, it’s building an entirely new architecture called Ultium that uses new batteries and new software. This is very new territory, even for The General.
So now, CEO Mary Barra’s message is taking shape: help is on the way. Here’s Automotive News:
GM will get some help reaching that goal when its second Ultium Cells battery plant with joint- venture partner LG Energy Solution opens in Tennessee this year, joining the one already operating in Ohio. With more battery capacity and more EV nameplates on the way, GM is working to resolve issues that have constrained its ability to scale production.
More than 2,000 Lyriqs and Hummer EVs reserved by customers were in transit to dealers at the end of June, Barra said on GM’s second-quarter earnings call. And more than 1,000 Lyriqs were delivered to customers in July, CFO Paul Jacobson said during a J.P. Morgan conference this month. It took GM nearly a year to deliver the first 1,000 Lyriqs.
“There’s been some criticism that we should have been faster with our EVs. We’re going as fast as we can, but we wanted to make sure we were leveraging a platform that’s going to give us efficiency with Ultium and that consumers weren’t going to have to compromise,” Barra said. “I’m very confident with the product portfolio we have coming, the pricing and the demand.”
Honestly, though: I find it tough to knock GM on this one. You can knock the massive multi-brand marketing hype, for sure, because at some point you have to deliver on your huge promises (or you find some that you can kick down the road forever because your company’s market cap is tied to them.) But if GM sees the move to the Ultium EVs as the long-term, long-game future of the company—which is nicely profitable at the moment—then it makes sense to take time to get things right. It’s one thing to have glitches with an expensive toy like the Hummer EV; that won’t fly with the more mainstream cars.
Anyway, GM is working on the electric thing.
Battery Plants Are A Point Of Contention In The UAW Fight
Spurred in part by big federal investments thanks to the Inflation Reduction Act, pretty much all of the automakers that build cars in the U.S. are spinning up new battery plants like that GM-LG plant in Tennessee. You can’t have EVs without batteries, right? But that’s exactly part of the labor fight going on in Detroit right now. As Bloomberg explains, those workers are making crucial GM parts but they aren’t a unionized shop:
One of the more divisive topics putting General Motors Co., Ford Motor Co. and Stellantis NV at risk for potential strikes in the coming months concerns the thousands of battery workers they’ll need the next few years.
The United Auto Workers wants to represent these hires, and for them to get the same pay and benefits as union members at other facilities.
The companies want to cordon off this conversation from negotiations of new four-year labor contracts they’re negotiating with the UAW. For one, most of their battery factories are still under construction. Plus, these facilities aren’t the carmakers’ outright — each of them have set up joint ventures with Asian battery manufacturers.
And as usual, new UAW President Shawn Fain isn’t mincing words about how he feels here:
Fain understands carmakers needed to form joint ventures to access battery technology, but they could have hired the workers at better pay. He has a solution in mind: have the car companies do the hiring at auto-worker pay rates, then lease these staff to the battery ventures.
“We’d love to see it, or some type of arrangement, but the companies have to be willing to do it,” Fain said in an interview. “Their intent was to create a different class of workers.”
The challenge for the UAW is that generally speaking, EVs need fewer parts and less labor than conventional cars do. So those battery plant workers could someday form a big chunk of “auto industry” jobs in America.
The UAW fears that if they aren’t unionized or getting good wages now, that may never happen. But the automakers are desperate to cut costs in the race to electrify, so they don’t want to pay those higher union wages, and I’m willing to bet companies like LG or SK On don’t want to mess with the UAW—now or ever.
More on that from Fain:
The car companies say their joint ventures weren’t set up to be end runs around union wages. They need the expertise of battery partners to build the packs powering their EVs, and for these facilities to be cost-competitive.
“To me, that’s code for a race to the bottom,” Fain said. “Mary Barra made $200 million over the last nine years. I don’t know how someone looks themselves in the mirror knowing what they are doing at Ultium.”
I think this will be an especially interesting part of the UAW negotiations to watch because it really encapsulates what’s at stake here: does the future of the American car industry include union labor or not?
Hyundai, Genesis And Kia Also Ramp Up U.S. EV Plans
I struggle with a persistent problem in my life: I would really love to own one of Hyundai and Kia’s rad new EVs, like an Ioniq 6 or an EV6. But they are still very expensive and, because they’re built in Soth Korea, left out of the EV tax credits (unless you lease them, and then it’s debatable whether you’re saving money or not because that “deal” could just get baked into a lower residual at the end of your term.) A shame! These cars are great, but pricey.
Help is on the way here too. Automotive News has an update on Hyundai Motor Group’s huge battery and EV factory plans across the South. You know how Tesla has the Gigafactory? Hyundai calls theirs the “Metaplant.” They got the golden arches, mine is the golden arcs, etc.
Kidding aside, the Korean giant has big plans for EVs in the U.S., including the big vehicles we Americans love most: three-row crossovers and pickup trucks. They get us. From the story:
Six models are planned for the plant, which has a capacity to build 300,000 EVs a year and the ability to produce up to 500,000, depending on demand. Three of those models are likely to be Genesis vehicles. Production of the Ioniq 7, Hyundai’s three-row electric kid hauler, could also move to Georgia. In late 2026, both Kia and Hyundai are expected to launch midsize electric pickups geared toward the U.S. market; both could be candidates for Metaplant assembly.
Hyundai also spent $300 million upgrading its plant in Montgomery, Ala., to build the Genesis Electrified GV70, an electric version of the top-selling luxury crossover, as well as the hybrid version of the Hyundai Santa Fe.
In a similar move, the group is spending $200 million to ready the Kia Georgia factory in West Point to assemble the EV9, a boxy, three-row crossover and Kia’s second dedicated electric vehicle. Kia EVs also will benefit from a joint venture between HMG and battery supplier SK On that will likely be its primary source of power packs.
The first wave of Kia EV9s, to go on sale this year, will be imported from South Korea. Kia Mexico also is likely to undergo electrification upgrades. The company already produces the compact Forte and subcompact Rio, which is being discontinued after the 2023 model year, at its factory in Monterrey, Mexico. Forecasters believe two smaller electric crossovers will come from the plant after a full-scale retooling.
Besides the tax credits, being able to build these cars locally and at a greater scale will no doubt lower their prices long-term. I don’t see Hyundai doing crazy Tesla-style fire sale moves, but as it ramps up these cars in America, I fully expect them to become more competitive in price. But that could take several years to happen, unfortunately.
Tesla Will ‘Lock’ Its New Battery Capacity With Software
I will scream this from the rooftops until I am dead: the way automakers plan to make a bunch of money in The Future is by having you pay over time for features that were once baked into the total purchase price of the car. “Recurring revenue” will be a huge part of the way they do business soon and that’s all driven by software.
Now, that’s not exactly what’s happening here, but Tesla has a great example of the software-driven control automakers will have over future cars. Those new Standard Range versions of the Model S and Model X will have the same battery pack as the Long Range versions of those cars (a sizable 100 kWh) but its “true range” will be locked by software. This is from the tech site Not A Tesla App, which follows such developments closely:
Tesla has previously utilized software-locking strategies, allowing the company to streamline its manufacturing process. The new Standard Range Model S and Model X vehicles are no exception to this approach. These cars have the same battery packs as their Long Range counterparts, but 21% of the capacity has been locked.
Tesla’s software-locking strategy for the new Standard Range Model S and Model X continues its innovative manufacturing and market positioning approach. Whether or not Tesla will offer the option to unlock additional battery capacity in the future remains an open question.
There are a few ways to look at this. For one, I think it is a clever approach for Tesla, rather than having to develop all-new battery packs for the relatively slow-selling Model S and Model X—both are older and more expensive and vastly outsold by the Model 3 and Model Y. But I worry about a waste of resources involved with building a big 100 kWh pack, and then “locking” its true capacity. Then again, Tesla sells so few of these cars and may have 100 kWh production so dialed-in it may not matter.
But even beyond Tesla, this is the kind of thing you can expect more of in the future. You want to “unlock” all your car’s features? You’re gonna pay up. Or you find some way to grease it yourself like jailbreaking a smartphone.
Your Turn
Would you ever “hack” your car to unlock its true features? You can tell me, I’m not a cop. If I was a cop, I’d have to tell you I was a cop. That’s how it works.
Either way, I think that like nature, the car tuners find a way, and there could be a whole new generation of enthusiasts figuring out crazy stuff to do—not with parts, but with code.
As you’ve pointed out, locking existing features with software is a losing proposition. I’ll go further and say this is particularly true with used vehicles. It won’t even matter if the vehicle is still under warranty, because good hackers will be able to unlock features and then imperceptably re-enable the lock if warranty work is needed.
The biggest thing the short-range S and X tells me is that there’s WAAAAAY more profit in those cars than the price cut you get for buying the battery-capacity-limited one.
If the same battery goes in every S, and Tesla is willing to sell you one for $10,000 less, wouldn’t you be just a little pissed to pay more for the longer range one? I mean yeah, the range is “locked out”, wink wink, but sure it will stay that way… nothing to see over here at this hacker’s place…
Absolutely, 100% will hack my car, especially if software is preventing me from using the hardware I purchased.
Current auto building employees are buggy whip makers. They make too much, dont have the needed skills and union head thinks the big 3 will agree to hire people with the wrong skills at the top of the payscale because EVs need to be more expensive? This is the escape from union incompetence the big 3 have prayed for
Damn this is a bad take.
Can confirm the Lyriq exists. I was walking the dog about 930PM about 3 weeks ago in my little neighborhood in PHL and one just silently arrived at the stop sign at the corner of my street. I was pretty shocked to even see it. I was also stuck staring at the light up grille/fascia. The two inside were probably wondering what that doofus is staring at
“I was also stuck staring at the light up grille/fascia. The two inside were probably wondering what that doofus is staring at”
Are you kidding? That’s the kind of attention anyone who buys anything with a light up grille/fascia LIVES for!
Went and saw the Barbie movie yesterday. The GM sponsorship was disappointing because it blocked the obvious inclusion of a Barbie Jeep in the movie. Seriously, the Tuscadero Pink Wrangler exists and was waiting for this. Disappointing.
One note about the software locked battery… it has an added bonus of you being able to charge it to 100% with the knowledge that the battery won’t actually be charged to 100% and thus, won’t be hard on the battery longevity.
Theoretically, the software-locked battery should last longer.
“Would you ever “hack” your car to unlock its true features?”
If it’s under warranty, no. If it’s outside of warranty, then maybe… depending on the nature of the hack and the potential risks
I will 100% hack my devices to jailbreak them, if it gets me features or control that I want and doesn’t negatively affect safety and utility. Done it before, will happily continue to do so.
Also, there must be someone out there besides me who is looking five years down the road and will want a PHEV station wagon or small minivan that will seat 6, right? Not a giant SUV, not a blobfish-shaped crossover, just a decent family hauler. I really hope I’m not going to have zero options when the time comes.
==But they are still very expensive and, because they’re built in Soth Korea==
Little typo there; I’m sure you meant to write “Goth Korea.” You’re welcome.
It was supposed to be Sloth Korea. They(TM) are trying to keep it quiet, but a group of sloths isolated in a forgotten rainforest valley have evolved much higher intelligence as the result of changing to a higher caloric diet and have gathered together in an alliance. Nobody knows why they established a secret colony so far away from home, but they have infiltrated the DMZ between the Koreas where it is speculated that they are training on how to contend with colder climates. There is some thought that they may be planning to stage an attack of one Korea on another to instigate a world war, but while leading minds who have the clearance to know about this have been so far unable to work out their intentions, the fact that they are aware of this potential action bodes well for our ability to limit the effects of a false flag operation.
Me thinks Thou hast crossed a fine line.
I heard on Mastodon that the sloths are being supplied with fissionable material by the mutant aardvarks that have become the apex predators of the Chernobyl Exclusion Zone.
Adrian Clarke’s favorite southeastern Asian county
Except they like big black wheels.
Well, I’ll probably never buy another new car, or even one new enough to still have a warranty, so hell yes, I’ll make it do what I want. It’s my sincere hope that for EVs, someone comes up with a generic Linux-like “Car OS” that you can install in any used car, and then configure it however you like.
I have and will hack my cars.
But, I can see this becoming an issue when the lawyers get involved.
With today’s cars being online and able to report to the mothership.
For example. I can see you buying a Tesla. Signing one of the 40 sheets of paper with lots of lawyer weasel wording. One sentence of which is that if you unlock the any feature you have not paid for, they have the right to render the car inoperable remotely. (i.e. no start until paid for, etc.) This is a terrible and slippery slope……
locking up 21% of the battery by software seems ridiculous. keeping that much battery as ballast must have some sort of efficiency implication, and clearly environmental implications. Either, the market needs to get more competitive (which it clearly does if Tesla can make money doing while doing this), or regulations need to make this practice unprofitable.
That suggests Musk cares about the environment
I guess you’ll just never convert me from swapping mechanical parts and getting greasy hands to plugging in a dongle and pushing buttons to ‘hack’ my car. I am all for people modifying and messing with stuff but come on, playing hacker will never be as fun as installing a shifter, intake or set of headers.
You must have never owned a turbo car before….
I have actually owned two, plus tinkered on a few others!
Resource availability in the future for batteries is uncertain. Tesla wasting those resources by putting extra into a car that an owner may never purchase and unlock, is extremely wasteful and stupid. Just another example that no one in the EV market actually gives a shit about saving the planet.
If they did, everything would be repairable with basic tools, all the software would be open source and available, a dealership would never be needed to repair anything on the car, and efficiency of the platform would be one of the most important design considerations to keep the required battery size down.
Even Tesla, one of the least egregious offenders, is locking you out of the full battery without paying a subscription fee. You really don’t own the car anymore…
Unless there is a substantial change in the UAW to become more reasonable (and it appears to be going in the opposite direction), the future of the american car industry will either not include union labor, or there will not be a future for the american car industry. Without savings in labor cost, the big three will not be able to be innovative and competitive in the EV space and Americans, despite all the hype and bravado, will not pay an inferior product just because it is made in America or with union labor. The 2023 Chevy Malibu starts at $25K. The 2023 Toyota Camry starts at $28K. Which one would you rather drive? Which one will retain more resale value in 5 years? Before someone brings up the “Toyota tax”, I drive a 2011 Camry with almost 170K miles and it’s quality is vastly superior to my wife’s 2017 GMC Terrain with less than 60K miles. There is a good reason Toyota’s sell at a premium on the resale market.
I think asking for pay to be adjusted based on inflation / increased cost of living is reasonable, but I really don’t see them getting the 4 day work week for 5 days pay. I’m guessing Fain is trying to set the bar super high so they can negotiate to something still in the ballpark of what they want. The problem is that the other side is looking to gut absolutely everything. Exact opposite motivation. If it falls apart, you can expect the already lousy build quality of any “American” brand to tank even further. Given the nature of the rail industry and aviation, we are heading down a dangerous road. A furious one even.
Even though the UAW isn’t at the Toyota factory, they are influencing the hourly wages. Per Toyota’s website, hourly positions start at $22/hour and top out at $31.61/hour. Skilled positions are even better compensated. From what I can find in a couple of minutes web searching, the UAW maxes out at $32.32 for a comparable position.
If the UAW goes bust, I’m sure those wages will slowly erode down to market conditions local to the various factories.
If the UAW gets most of the pay increases they are demanding, non-union factories will need to step up their pay game or risk the hourly organizing.
I’m sure measuring costs in hours per unit of direct labor, there isn’t much difference between a Camry and a Malibu. It’s indirect labor and retiree pensions/benefits that are probably costing the legacy OEMs vs the non-union manufacturers.
Are there any places that unionized domestic plants and non-union foreign plants are in close enough proximity to encourage job hopping for wages though? The only ones I can think of are Ford and Toyota both having plants in northern Kentucky, though there may be more I’m missing.
I think Toyota pays the wage they do because the job market is tight and production slowdowns are very costly, so reducing turnover is very important. I don’t think prevailing wages at domestic plants that are mostly hundreds of miles away have much to do with it.
by staying within close proximity to UAW wages, they can continue to keep their plants from unionizing.
This is why unions are good. They improve working conditions for everybody.
A rising tide lifts all boats. I’m really hoping they get the 4 day workweek, in some form or another. Some coworkers and I are pushing for that from our employer and are getting the type of corporate pushback one would expect.
I think that is the union argument, but I don’t think it is true. I live in TN, and we are a right to work state. There are a lot of automotive plants in TN. I think the competitive work market in our area is driving up wages, not unions. Fast food and retail is paying $17 – $18 per hour here.
Right to work really means “can fire your ass at any time for any reason”, correct?
Any legal reason, yes. However, you are still subject to labor laws and unemployment claims if the firing is not for cause. Because of that, most companies have progressive discipline processes. You also can quit for any reason. Contracts for any job other than professional services (Drs, lawyers, etc.) are not enforceable. The laws also make non-compete agreements very hard to enforce (at least in TN) because the company must prove actual damages.
I’m not going to argue whether or not the UAW’s labor negotiations will be an albatross to domestic manufacturers or not, but I think it’s a bit of a strawman argument to blame overall vehicle quality on the people who put it together. I could have a master carpenter put together my IKEA bookshelf, but if the materials and engineering are crap, that’s not really going to save it. Yes, labor is a factor, but vehicle quality starts at the top with management’s requirements for the bean counters first, then the poor engineers who have to execute those restrictions.
Yes, but you have to contain cost somewhere. If you labor cost go up, you have to cut R&D, materials, or something else. The favorite whipping boy of labor is executive pay. If you cut executive pay in half, it would it would be a rounding error compared to the cost of workforce labor.
GM will compromise safety to save a dollar on a car but pay their executives substantially more than replacement cost. Just because a cost is small overall does not mean it isn’t worth optimizing.
I don’t know either way, but that is not my point. My point is executive pay is not a significant part of the cost of producing the vehicles. Complaining about executive pay when talking about cutting cost at any of the big three is a straw man.
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> Without savings in labor cost, the big three will not be able to be innovative and competitive in the EV space
Respectfully, that’s bs. The manufacturers are making profit hand over fist, and Japanese manufacturers are licensing the Ultium platform.
The anti union, anti labor rhetoric that really took off in the ’80s is so wild. Normal people are siding with corporations over their friends, family, neighbors, and fellow Americans. Truly the devil’s best trick.
Wouldn’t it be more innovative to figure out a good way to manufacture different batteries on the same line?
What do you mean, like, replaceable and expandable modules that make upgrades, repairs, and manufacture relatively cheap and easy?? GTHO!
The Bimmercode app makes it pretty easy to “hack” BMW features. Hopefully DT has hacked his I3 with for the extra gas tank capacity and the “Hold SOC” mode by now. I haven’t played around with it yet, but I may try changing the interior lighting color options and swapping to the Rolls Royce tones for startup, turn signals, etc. There’s a lot of little tweaks you can make.
Bimmercode or Carly is mandatory for new BMWs, so you can disable the fake exhaust sounds. Though if you don’t want to DIY, just negotiate it as a freebie when buying a new or used modern one at a dealer. Some people negotiate a list of coding options into their purchase contracts.