EV startup Lucid Motors is going to report its quarterly earnings this evening and the suspicion is the company will continue to lose money. A lot of money. Is there something wrong with the cars? Nope. The cars are great. So what’s the deal? Let’s get into that because there’s a limiting factor that impacts Lucid and anyone else trying to sell EVs in the United States.
It’s going to be an all-electric edition of The Morning Dump and I’m on the mother-of-all electric vehicles: a Siemens ACS-64. It’s a train! I’m headed up to Boston this morning to support one of my oldest friends, whose son is about to undergo a seven-hour brain surgery to remove a tumor lodged in there. This is a scary prospect, but the surgery should help improve the little guy’s quality of life a bunch. Inasmuch as it’s a thing you do, please keep the family in your thoughts and prayers today.
What will I be doing today on a practical level? I don’t know, but I can certainly talk for seven hours if that’s helpful. As a warmup, let’s talk some more about electric cars.
Unlike Lucid, GM is on track to make profitable electric cars by the end of the year, and a key reason is the start of cell production at one of its battery plants in Tennessee. While GM is moving in the right direction, the transition to an EV future in the United States isn’t going to be an easy one, and Vice President Kamala Harris is going to be in Detroit today to announce $100 million to help car companies and suppliers make that transition. This makes a lot of sense practically, and even more sense politically.
Finally, politics will be fully on display in France as the leaders of China and France meet this week. One of the topics of conversation? EVs!
The EV Startup Conundrum
I thought the Lucid Air was a great electric car when I drove it, in spite of some small software issues that seem to plague pretty much all super-modern cars. The biggest issue, though, was the price. At the time a Lucid Air Grand Touring started at around $139,000. The cost has since been dropped to $109,000 for the GT, but it still offers 514 miles of Tesla-beating range on the EPA test cycle.
If you’re going to get an electric luxury sedan it’s hard to argue for any other car currently on the market. The base Lucid Air Pure still looks like a dream and, at $69,900 (before taxes and delivery) its 400+ miles of range make it a better deal than the Model S. [Ed Note: There is the Tesla’s Supercharger advantage, of course. -DT].
The good news for Lucid is that sales in the first quarter were up by 40% year-over-year to almost 2,000 vehicles, which shows that the price drop is working. While it’s working to move some Airs, the company is still wildly unprofitable, and a price reduction when you’re losing money isn’t a long-term strategy.
In 2022, the company lost $1.3 billion. Last calendar year, the company lost $2.8 billion. If you’re not great at math, those numbers are going in the wrong direction. Lucid is, of course, an American company making EVs in America. The not-so-big secret is that the company is being heavily backstopped by Saudi Arabia, presumably as a hedge against a future drop in demand for oil. But even the Saudis can’t pump money into Lucid forever, right?
Many of these companies are following in the footsteps of Tesla and making, arguably, better vehicles than Tesla currently is. I haven’t driven a Gravity yet, but the company’s first SUV looks a lot better than the Model X.
So why can’t they succeed where Tesla has?
There’s a great line in this Automotive News piece on Lucid’s financials that sums up the problem:
Parkev Tatevosian, an investment writer at The Motley Fool, said Lucid and other EV startups face a difficult task because they need to scale up production and grow sales but there aren’t enough buyers to do so.
“These companies are in a position where they need to increase supply in order to become profitable but at the same time the [EV] industry is already oversupplied compared to where customer demand is,” Tatevosian said in a video. Unlike its legacy rivals, Lucid can’t shift sales to gasoline or hybrid models as EVs wane.
That is exactly correct. Both Lucid and Fisker launched into already oversaturated markets. There’s definitely a large portion of the market that wants electric cars, but most of them already have electric cars. Even worse, most of those cars are Teslas, and because of its status as an early adopter the brand loyalty for Tesla is the highest in the industry.
Tesla benefitted from government loans, carbon offset tax credits that funneled money from traditional automakers into Tesla’s pockets, and a huge first-mover advantage. It didn’t hurt that the products were better than anything else modern carmakers had even imagined.
While the Model S was expensive when it launched, the only real competition was the Nissan Leaf, which lacked the performance and, more importantly, the style. Tesla was able to therefore grow rapidly and funnel that money into more models and more production.
This worked for Tesla but it hasn’t quite worked for any other EV startup in the United States and Europe. Of the automakers not affiliated with a larger car company (like Polestar), the most successful new entrant is probably Rivian, which still loses billions of dollars, but at least was smart enough to build a truck/SUV combo to find some grey space in the market. Almost everyone else, including the major automakers, rushed to two-row crossovers, thus overstuffing that market far beyond demand.
To reach the next tranche of buyers, companies will have to not just offer more model types, they’ll have to offer significantly cheaper cars. But, yet again, this means automakers will need to dramatically increase the efficiency of production, which requires more sales, which requires cheaper cars, which requires more investment, which requires more sales, which requires cheaper cars… ad infinitum.
Again, from the Automotive News piece linked above:
“This is not sustainable,” Tatevosian said. “I understand Lucid has enthusiastic investors that are willing to give the company money and invest in the company. But that is not unlimited. They can’t continue giving money to Lucid to burn.”
I don’t know. Maybe they can? Stranger things have happened.
How GM Is Going To Get Profitable
Do you know what big car companies can do that EV startups cannot? Make gas-powered cars. Almost every major automaker in the world is profitable to some degree and, likely, were extremely profitable during the pandemic. This makes the investments in electric car production a lot easier.
There’s an argument to be made that, because of carbon offsets, Tesla itself was funded in large part by the sale of gasoline-powered cars. This continues today, with Tesla earning about $1.79 billion from offsets in 2023.
General Motors has focused on building efficient and profitable electric cars and the big key to this is production of its Ultium battery packs. Thus far the packs, made by an affiliated company co-owned with LG, were only built in Ohio. The opening of a plant in Spring Hill, Tennessee should get GM a lot closer to net profitably.
Ultium in Warren, Ohio, has been making battery cells for GM since August 2022, supplying them to various GM EV plants in North America. The Ohio plant is the road map to help subsequent Ultium factories ramp up production faster, GM CFO Paul Jacobson said during the automaker’s first-quarter earnings call with Wall Street.
GM leaders and analysts say bringing the new Ultium Spring Hill factory online is critical if GM is to meet its promises: to produce 200,000 to 300,000 EVs this year and make money on them by the second half.
“We ramped our first battery joint venture plant last year, and as they increased production and made other efficiencies, the cost of cells came down significantly,” Jacobson said. “And cell plant No. 2, in Tennessee, is ramping even faster based on the learnings from plant one and is expected to reach full installed capacity by the end of the year.”
According to GM, the Cadillac Lyriq (also made in Spring Hill) now costs $12,000 less to make than it did a year ago. A third plant set to open later this year should help even more.
$100 Million For Suppliers To Transition To Supporting Electric Cars
If you’re a tire supplier for automakers there are new things to be learned in the transition to electric cars but, presumably, these vehicles will need tires made approximately the same way tires were always made. Even better, EVs currently need more tires than their gas-powered counterparts on a lifetime basis.
But what if you make oil filters? Or alternators? Or any of the greasy bits that make an internal combustion engine run? The transition to making electric cars might be a little harder.
In order to help, Vice President Kamala Harris is going to be in Detroit today to announce $100 million in federal money to help this transition. From her office:
More than $100 million in funding for small- and medium-sized auto parts manufacturers to expand or retool manufacturing facilities:
The Department of Energy will set aside $50 million of its Automotive Conversion Grants Program for partnerships with states to help small- and medium-sized suppliers convert from manufacturing internal combustion engine parts to manufacturing parts for the EV supply chain. This funding will maintain the Domestic Conversion Grant’s same focus on supporting retooling to keep good, good-paying and union jobs in the same communities as automakers and auto suppliers transition to electric vehicle manufacturing here in America. The Department of Energy recently requested public input on the design of these state-federal partnerships in order to best support small- and medium-sized manufacturers in the auto supply chain.
The Department of Energy is setting aside up to $50 million of its Industrial Assessments Center Implementation Grants Program to help auto suppliers kickstart manufacturing diversification and conversion projects. Specifically, this program, which was funded by President Biden’s Bipartisan Infrastructure Law and is covered under the President’s Justice40 Initiative, provides grants of up to $300,000 to entities that have received an Industrial Assessment Center assessment to improve their facilities’ energy and material efficiency, cybersecurity, or productivity, or reduce the greenhouse gas emissions.
Here is the non-cynical spin on this: Global climate change is real. Automakers are not quite being forced to build EVs, and no one is being made to buy them yet, but there’s a lot of heavy cajoling going on and it’s silly to pretend there isn’t.
I visited the bucolic home of Theodore Roosevelt on Long Island this weekend. It’s a national historic site and they therefore have a Junior Ranger program that involves kids answering a series of questions about the place and getting a sweet badge afterward.
Teddy famously loved to quote the West African proverb “Speak softly and carry a big stick.” When asked to put this in her own words “by the Junior Ranger booklet,” my daughter even more succinctly explained that this meant: “If they say no, whack ’em!”
There’s a little bit of that in our industrial policy towards EVs, so helping these suppliers make the transition seems wise. This was pointed out in a post this morning from The Detroit News:
Jonathan Smith, a senior deputy at Michigan’s Department of Labor and Economic Opportunity, applauded the Biden administration’s work to prepare the state’s workforce for the mounting EV transition.
“We’ve always sort of been in this position where we’re just scrambling to respond,” he told The Detroit News, referencing previous challenges for the auto industry, namely the 2008 financial crisis.
“This really feels like one of the first opportunities we’ve had to really get out ahead of a problem in a while.”
Foresight! From Government! What’ll they think of next?
That’s the non-cynical take. The cynical take is that Michigan is probably the most important state in this year’s upcoming election, which is why President Biden, VP Harris, and all manner of other administration figures keep ending up there. It’s why both Biden and former President Trump have both been sucking up to auto workers.
If the automotive industry were based in a less competitive state like New York or Texas would taxpayers be spending so much to save these jobs? Maybe!
What Kind Of Bargains Can France Make On EVs?
All politics is local, except when it’s global. All politics is local and global. And regional. And sometimes national. All politics is all geographies simultaneously.
And that’s good! Politics might get rough, but the idea is that we can establish a set of rules, laws, and mores that help us decide things without doing what we used to do, which was just kill everyone who disagreed with us and take their stuff. Humanity has mostly moved on from this stage.
France is one of the more open-minded places when it comes to environmentalism, largely because even the more mainstream conservative parties there believe in climate change. But France is also highly protective of its car industry.
At first, France welcomed Chinese-built electric cars and even helped subsidize them, which meant a flood of Dacia Springs, Tesla Model 3s, and MG MG4s built in the Asian nation. In addition to concerns over Chinese subsidies and unethical labor practices (aka alleged slavery), France didn’t want anything bad to happen to its own car industry so it changed the rules for its EV subsidies to include production/shipping, which led to a dramatic drop in the appeal of those cars.
All of this is going to come up this week when Chinese President Xi Jinping meets with France’s President Emmanuel Macron. Xi needs Europe to be favorable to Chinese cars in order to help the country deal with its overcapacity problem, whereas Macron wants China’s help in ending the war in Ukraine (to Macron’s credit, he’s been a huge supporter of Ukraine). Macron also wants to talk about Cognac.
Paris is the first stop on Xi’s European trip, seeking to rebuild relations at a time of global tensions. After France on Monday and Tuesday, he will head to Serbia and Hungary.
France hopes the discussions will help convince China to use its leverage with Moscow to ‘’contribute to a resolution of the conflict” in Ukraine, according to a French presidential official. Russian President Vladimir Putin recently announced plans to visit China this month.
Macron will press Xi over supplies from Chinese companies supporting the Russian war effort despite EU sanctions, he said. China claims neutrality in the Ukraine conflict. France also wants China to maintain a dialogue with Kyiv, added the official, who was not authorized to be identified according to presidential policy.
Last year, Macron appealed to Xi to “bring Russia to its senses,” but the call was not followed by any apparent action by Beijing.
I’ll keep an eye on it this week and see what kind of movement we get from either side.
What I’m Listening To While On This Train To Boston
Hell yeah, Dropkick Murphys! Nick mentioned this song in the Discord and it was the perfect accompaniment to the trip. I know the song well, but I’d never actually seen the video, which includes two key rarities: menacing accordion play and a Grand Marquis cop car… What in the name of Raylan Givens is that all about?
The Big Question
Is there room for another EV startup or is this the end?
Lucid would sell 1/3 more cars if they just offered them in brighter more interesting colors!
There is a Lucid dealer near my house, and as much as I like the design and respect the engineering, the endless sea of muted colors makes it one of the dullest car lots imaginable. These are cars being marketed to upscale first mover buyers, many of them extroverts, yet they are in colors that wouldn’t stand out in an airport parking lot. When its hard to tell the red from the nine kinds of grey you need a new a new palette.
Historically, new manufacturers to the US market brought inexpensive and, more often than not, smaller vehicles to market first. Honda, Datsun, Toyota, VW, and Hyundai all started with a cheap little car.
So my headscratcher is, why isn’t anyone following this formula? I understand the need to be profitable quickly but I continue to feel that the first manufacturer to bring a small platformed group of cars in that $25-30k price range, will win via volume.
Margin. Which is why the dealers are rolling with it too. To make X in profit, you can sell Y cars, or Yn cars. It’s more work, and requires more people, to sell Yn cars.
Granted, there’s only so many people to buy more expensive cars. Dealers are now realizing this, and that the market at $50K and up ASPs and up has become saturated. I’m well aware from folks I know in the Midwest that $80K+ pickup trucks and crossovers are just sitting on lots. Those things were getting financed by people taking on debt up to their eyeballs, and when a 5-year note has the APR it does now, those buyers dried up.
With cars lasting 20 years or more, used cars have eaten the low end of the car market. Its difficult to sell a low price lower content car when a fully loaded and well supported used car can be purchased for the same money and may in fact be more reliable.
That said, the EV revolution may upend that, at least for a while.
Development cost for a new car on a new platform to meet US safety standards is currently in the hundreds of millions of dollars, no matter where it’s being developed.
Those cheap little cars that started the import waves in the 1950s didn’t materialize from thin air; they were mainstream, full-sized, normal cars in their respective foreign markets. Getting them federalized for the US market was the only cost incurred, involved platform engineering only for later entries, and this cost was usually included in an overall development and refresh cycle already occurring.
Developing a car for the bottom of the US market is simply not a viable way to start a car company in today’s market. Several have tried, even attempting to go through the loophole that motorcycles don’t have to meet the same safety regulations, and so far, all have failed.
People are forgetting that Tesla was unprofitable until 2020. It relied on government grants and startup investment to stay afloat. Its worst loss in a year was $1.9 billion. That’s 12 years with no profit.
https://www.macrotrends.net/stocks/charts/TSLA/tesla/net-income
Tesla started in 2003. It was I think in 2012 when it was 1st available for public trading. Your link shows Tesla.finally started turning a profit (YoY) in 2020…
So simple math, Tesla was YoY unprofitable for the 1st 17 Years it before it turned a profit on a quarterly basis.
Rivian started in 2009, again simple math, if they can continue to remain in business and successfully roll out their next lower cost vehicle (R2) to match Tesla they would have to start YoY turn a profit in 2 years time (2026). Hopefully they don’t “run out of runway” aka funding before they start to make a profit.
As nice as the Air and the Gravity are reported to be, the numbers of units sold is still so low, (selling in the singular thousands per year) it is difficult to see Lucid getting to profitability.
I think there’s room for an EV start-up, but only if they can compete in the sub $30,000 market, preferably sub $25,000. Selling high volume with the attendant lower profit margin is only possible if everyone can afford your product. I don’t think there is broad appeal for any additional luxury offerings. I will be surprised if Lucid, Rivian, et al survive. Tesla appears to have succeeded but I don’t think they could do it again in today’s market.
Rivian will survive, if not as an independent, they’ll get snapped up and sold as a subsidiary of some larger make. Their commercial truck is too good, and the consumer vehicles are a bit pricey, but solid offers.
Big OEMs have the whole supply chain and years of experience. Switching from ICE to EV is “easy” for them. One business support the other.
Startups have to start from scratch, competing with the big dogs. Unless they have support from a “sugar daddy” that throws them money as they need (Polestar and Geely for example), there is no way they will survive on their own unless they brand themselves as unique and different, people like that. That’s why Rivian has been ok from a brand perspective, delivering to amazon those cute vans and their designs are focused to “Patagonia” customers.
We don’t need more brands, we need to expand portfolio of our current brands to compete and create better vehicles to satisfy the market. People is loyal to their brand, Chevy guys will not even look at a Ford.
Automakers are not quite being forced to build EVs, and no one is being made to buy them yet
Counterpoint: For an automaker to come out with a new Miata or 90’s sized compact pickup truck, it has to get 50mpg. You cannot get that from a regular internal combustion engine and pretty damn hard for a hybrid. ( Especially when the old pickup trucks were body on frame and weighed 4,000 pounds) So to get those types of vehicles brand new, you have to go electric. Prove me wrong.
My 2023 Kia Rio gets 55 mpg at a constant 55 mph. It is definitely possible to build a car with a new engine that gets 50 mpg, but it might be hard getting people to actually buy it.
Body on frame, 4,000 pounds, with an internal combustion engine?
Curb weight just under 2,800 pounds, so 400 pounds heavier than a new Miata.
I’ll give you that, but it’s 1,200 pounds lighter than a 2011 Ford Ranger that doesn’t have the added weight of thicker pillars, side impact door beams, as well as all the other safety regulated features that are mandatory today.
Plus there’s the other add-ons like radiator shutters and extra cam lobes.
The Rio is 750 pounds lighter than the Ford Maverick (lightest version which I assume is 2.0T) at 3550 pounds. Downsize the engine to 1.6L (to be the same as the Rio) and cut a little weight using aluminum, then the weights would be even closer.
The other thing to remember is that the Rio shares its platform with other vehicles. The Miata only shares its with the Fiat version which I don’t think even is for sale anymore. That one car has to cover the entire tooling costs on top of everything else.
“the Rio shares its platform with other vehicles”
The Hyunda Venue is tuned to have 1 hp more with the same engine, and gets basically the same fuel economy as the Chevy Trax. All GM has to do is take the smallest engine they already have, detune it a little bit, and put it in a lower to the ground car with smaller wheels. Problem solved.
The Trax is unibody. I mandated body on frame construction that was standard for compact trucks in the 90’s
It would need be a hybrid with the same acceleration as a 1995 Geo Tracker
That could be fun.
Yeah but then you have to drive a Kia Rio, AND do it at 55MPH. Sounds terrible.
The existence of the Miata and Maverick seem to do a pretty good job of that. No, the Maverick is not as small as the 90s pickups, but that doesn’t mean it isn’t the modern equivalent, accounting for new safety regulations and general inflation in the size of all vehicles in the past 30 years. Neither of them get 50 mpg either.
Both the Miata and Maverick were designed and built before the 50mpg regulations took place for 2024. In fact, Mazda considered not making the latest iteration of the Miata due to the footprint regulations. It took the partnership with Fiat to go forward with the Miata.
The Maverick is based on the Escape and Transit Connect platform that was also designed earlier.
That’s how the Maverick and Miata get by today.
Not only is the Maverick based on other vehicles, the hybrid version uses an Atkinson cycle variant of the Mazda L engine they’ve been using *forever*
Thank you.
Tesla had first mover advantage in a nearly untapped market. This made everyone else who wanted to build an EV think there was no ceiling and those fat stock prices probably helped them drink their own kool aid deluding themselves into thinking they could grab a piece of the Tesla pie. There may be other opportunities in the EV space down the line but I doubt it’s going to be in the luxury car space. Sadly hard to see Lucid surviving even though they seem to have some really top notch engineering and tech.
Well, most of the 7 billion of us minus ~40% of the US.
And, no, there is absolutely NO more room for another electric car maker. NONE. I’m tired of this, can we move on from the Fisker’s/Rivian/Lordstowns already???
Putting Rivian in that group is a huuuuuuge stretch man.
It is, they are one of the few good ones. I just want this money suck to stop. The money has to come from somewhere, and not ALL of it is coming from the middle east.
Regarding the Big Question:
No, I think it will be almost impossible for an EV startup now unless they find a niche in the market that nobody else is doing.
And I would argue that the legacy OEMs that are just getting into BEVs (like Toyota) are the new ‘EV startups’.
And going forward, I actually expect there to be a shakeout of BEV makers… particularly in China.
I’m the one you were arguing with there, but what’s illegitimate about Tesla getting credits for the low-emission cars they made, and other automakers paying them because they’re not up to snuff?
Because there is literally nothing we can do about it. You can’t choose with your wallet, because there is no choice. You can’t choose by voting, because there really is no choice. The best we can do is try to not go crazy thinking about it, I feel. That, and drink.
What are you talking about? You can buy a huge fuel-sucking brodozer in any town in America. “Help, help, I’m being oppressed!”
The credits are really not that hard to understand unless you’re determined not to understand them.
How would you prefer the government to make the nation’s car fleet more energy-efficient? Would you prefer gas to be $10/gallon? That would probably work better and it sure would be tangible!
Or do you just object to the government trying to make the transportation fleet more efficient?
Yes, kind of. I’d prefer the gov’t not have much to do at all with it.
Well, also the environment for Tesla to grow in was ideal. They lived on tax credits until very recently and there were frankly no other competitors.
Can Tesla exist without a subsidy???? I feel like that was Elon’s only shtick, finding free money.
Wyrm!!!!!!!!! HEEEEEEEEEEEEEEEEEEEYYYYYYY!!!!!!!!!!!!!!!!!!
This is the shortest answer I have seen…. you are back! 🙂
It’s a shame that the corporate board can’t see this truth clearly and move on already. Although I think we can all agree that he is good at getting people to work insane, self-destructive hours, too, which is critical during the startup phase of almost every company.
Elon’s useful time at Tesla is over, it’s only a question of whether the board jettisons him quickly enough to save the company or not.
Elon owns 20% of Tesla stock, making ousting him a rather difficult proposition
https://markets.businessinsider.com/news/stocks/elon-musk-tesla-tsla-stock-shares-net-worth-ownership-stake-2024-2?op=1
I know this is going to sound counterintuitive, but the model an EV should follow up is American Motors, where outside of their core technology they outsourced a lot of their components from existing vendors and under license from other manufacturers. Start with an existing platform, alter it to accept your EV drivetrain, and have it produced by a company like Magna Steyr. Trying to create every single nut and bolt is by far taking the path of most resistance. Been saying this since Tesla started, and IMO it is still the right move if you want to reduce costs and by extension reduce prices.
The Build a Bearcat model! All for it, have a few winners at making commodity, easily replaceable battery packs(I think the only way to be truly green, and sustainable), and motors, controllers, and the auto manufacturers distinguish themselves with design.
Which companies making “platforms” do you think are open to this model in the market today? Why sell your chassis to someone to build an EV when you are already trying to build an EV yourself?
That is all open to negotiation, just like Lotus provided the starting point for the original Tesla Roadster. Perhaps there is a platform or platforms not currently sold in the U.S. that could be crash certified (remember, emissions testing isn’t required) and produced. My point is that it significantly cheaper and faster to start with existing hard points than to reinvent the wheel as not-wheel-people.
Why sell your chassis to someone else? Companies do it more often than you realize, and it can extend the life of a mature platform and/or line, or further spread out the development costs of a new platform and/or line. Perhaps in the arrangement you gain access to some of the EV technology, or just farm out your EV development to that company. In other words, any and all reasons why platform engineering happens in the ICE world.
Do you have any examples of mainstream companies sharing those chassis with small players? The Tesla/Lotus example doesn’t quite fit the modern day. Lotus had no interest in building an EV at the time, and needed further revenue. They would not have seen Tesla as a competitor. Same idea exists in Toyota selling powertrains to Lotus. Nothing Lotus does is really a competitor for Toyota’s markets.
What is an example of your idea that you believe seems viable in the current market? There was discussion in the Morning Dump about Lucid not having enough traction as an EV only company so what if they introduced ICE. Both I and another person mentioned Mazda powertrains. Mazda could likely use the extra revenue, and its unlikely a gas powered Lucid would take any business from Mazda. No real overlap in markets, so potential to benefit both small companies.
Since I’m am not privy to the entirety of the world automotive market and all of its ins and outs, I do not have specific current examples. I do know that manufacturers licensing older platforms to be repurposed in other markets is not an uncommon thing. If can be done for that purpose, there is no reason why it couldn’t be done for other purposes, other than that many of these start ups in general like to reinvent the wheel.
Further, the lack of a current example doesn’t prove or disprove the efficacy of my suggestion.
Startups? I’d be worried about regular manufacturers at this point given the potential future state of the charging infrastructure in the US. Musk just got done gutting the Supercharger team and says that expansion will be slowed. Among those laid off were maintenance workers, so not sure how that contributes to his goal of 100% uptime.
Meanwhile, Tritium (one of the largest non-Tesla DCFC manufacturers) is about to go bankrupt. Electrify America demonstrates all the enthusiasm you’d expect from court-ordered labor.
I’ve said it before, and I’ll say it again: until fast charging your electric vehicle is as convenient *and as fast* as filling up a gas tank, you’ll never get the country on board. I’m talking 10% to 80% in 5-7 minutes at most and working nearly 100% of the time. The “experience” should be walk up, insert credit card, remove charger. We already have enough range for most people, but this is the sticking point. How to allow this without wearing the battery out and safely centralizing enough power in a gas station-like location are some of the open questions here.
I agree with the analysis in the article – there isn’t enough of a market in the US currently and there won’t be until the above is achieved.
Build smaller, more-efficient EVs with power-dense battery packs that can accept high charge currents, say < 35 kWh delivering a 200+ mile range and able to charge at 250kW, and not only do you get much cheaper EVs, but with the charging infrastructure that currently exists, you can get sub-10 minute charge times.
The charging infrastructure isn’t the issue. The selection of EVs available being almost exclusively massive, bloated, inefficient vehicles is the issue, and that is also why they cost more than ICE cars. None of them on the market come close to matching the efficiency of a GM EV1 or a Solectria Sunrise, even though those cars are nearly 3 decades old. The Lucid Air is a heavy pig and it is more efficient than “city cars” that weigh less than half as much, thanks to its aero efficiency. Apply that same aero efficiency to a smaller/lighter vehicle, and you’ll get results like the GM EV1 or Solectria Sunrise. Look at the Mercedes Vision EQXX as a modern example.
I believe Stellantis will sell you something pretty close to what you’re describing. The 500 BEV has a 42kW*hr battery and goes 200 miles on the WLTP cycle. Probably more like 140 real world, but since it’s meant for almost exclusively city driving, maybe it will overperform.
To be best of my knowledge, they are not exactly flying off the shelves at $30,000+.
Its aerodynamics are crap, and thus its highway range will be much closer to that 140 miles. That isn’t enough range to be desirable, especially at its price point. It’s a city car.
The range needs to increase and the cost needs to decrease.
Exactly, but the only thing left to remove from that car for cost-cutting is battery capacity. The only way to increase the range is to add battery capacity. Rock, hard place.
I’m not sure what the drag coefficient is (some internet randos suggest the old combustion 500 was around 0.35, so safe to say it’s less than that), but how much are you going to claw back via that route on a car that already has so little frontal area? These are production vehicles for consumers, not competition hypermilers.
You have to build the car with aero that hypermilers would demand. There’s no real way around it if you want the efficiency required to meet range requirements on a smaller battery. It’s a matter of physics. Potential exists to cut drag in half, or even more. No one has ever offered such a car to the public, and then they say with certainty that no ne will; buy it.
Consider that the GM EV1, weighing around 3,000 lbs, could hold 70 mph on abut 0.160 kWh/mile. It has about 2/3 the CdA value of the Fiat 500. The Aptera 2E has abut 1/3 the CdA value of the 500, and does the same on about 0.100 kWh/mile, although it is also about 800 lbs lighter than the EV1.
Assuming it’s at ~0.30 today, I think you’d struggle to reach 0.20. Tesla put a lot of work into getting the 3 down to ~0.23, as I recall, and it’s just a bigger vehicle than a 500e to begin with, making aero drag a bigger, juicier target. Yes, the Aptera is below 0.20. No, it is not on the same planet.
I’m now speculating, but I think we would find that cutting drag doesn’t gain as much back as you hope, because the cycles that measure range are mostly low-speed and stop-start. It’s the round-trip efficiency from the battery to the road and back to the battery that’s dissipating most of the energy. Maybe you could cut mass a bit to help that, but your options are to cut advancements in crash safety since the EV1’s era (good luck being allowed to sell cars) or cutting passenger comforts and conveniences (good luck succeeding selling cars).
Cutting drag gains real-world highway range, more than it gains EPA cycle range. In long-distance highway driving, arguably where range matters the most, cruising speeds generally remain steady without much stop and go.
I’ve posted long lists of cars with Cd values below 0.20 before. Sedans can approach 0.15 or thereabouts. Consider the GAC Eno 146, Ford Probe IV, and GM Precept. That sort of reduction would have a massive impact on efficiency, allowing consumption figures close to that of the Aptera, without looking like they came from another planet.
That sort of aero efficiency in an inexpensive, basic, no-nonsense sedan would allow for an inexpensive, long-range EV. I could see BYD actually doing this in the near-future, as it’s obvious low-hanging fruit.
Sadly it looks like the 2024 Fiat 500 E cd is 0.324 🙁
http://www.fiat500usa.com/2023/12/2024-fiat-500e-us-full-specifications.html?m=1
Well, it IS lower than 0.35…
But yeah, something this small doesn’t leave much flexibility for aero. The car’s entire shape is about making 4 people fit inside.
Yeah I know you’re invested in this vision, but we’re talking about how to get normies into EVs here. They’re not going to go for an Aptera nor are they they going to buy something that only has two seats or looks like the EV1 or the Sunrise. Normal people want their car to do everything they need and more. I agree it’d be interesting for enthusiasts to have vehicles like that on sale though. Hell, I might even buy one.
If small tweaks that didn’t take over the styling and didn’t compromise safety but gave huge range increases were possible, automakers would have done it. They’d love to advertise huge ranges on “normal” cars. The whole point of my post is that the average person in the US *will not* change their lifestyle in any way for an electric car, so it has to do all the same things they do with their gas car. I know you don’t care about styling, but I assure you the average car buyer does. They care about it almost above all else. Maybe with the exception of safety.
The charging infrastructure is not only an issue, it is *the* issue. I figured someone would reply that sub 10 minute charging is technically already possible. This, of course, is already far longer than it takes to fill up my tank. The queuing theory implications of this and the effect on the number of chargers necessary to prevent long lines is left as an exercise for the reader.
I’m sure in lab conditions with certain vehicles that have 800v architectures it’s possible. Is it possible to have, say, 8-10 of those that work basically all the time in one place? What about one of those places in every town? Are they as fast below freezing? How about when it’s above 100F? Does the battery degrade faster when you charge it with that much power? If so, how badly does it degrade? The things that remain are the messy, real-world engineering problems, which are the harder ones to solve.
The biggest complaint about the EVs available in the U.S. is cost. This is closely followed by range.
Addressing that is how you get normies into EVs. The battery pack is the single largest cost item of the entire car, and it’s a periodic maintenance item/consumable that has costs associated with its upkeep/replacement.
Placing aero efficiency ahead of style is the least expensive way to add range. Modern vehicles are so aerodynamically inefficient that there is a lot of room for gains to b made, so much so that the battery cost can go down thousands of dollars while range simultaneously goes up 50+ miles.
We’ve NEVER had for sale a car of extreme efficiency capable of seating a family before by the mainstream automakers. Everyone saying they won’t sell is going by the results of past vehicles like the Chysler Airflow that weren’t actually aerodynamic, and only looked like what people thought was aerodynamic. Aerodynamic styling, rather than actual significant drag reduction. Contemporary cars of the Airflow’s time period like the Lincoln Zephyr were even more slippery and sold better. Another consideration is that the Gen II Prius was a success when it came out and it was simultaneously the most slippery car available on the new car market at the time, and the same could be said for the Tesla Model S and Model 3 when they debuted. People bought them up, even though they were the most slippery things available. Thy could have ben made even more slippery without compromising functionality for what they were.
A midsized sedan with lots of leg room, storage space, and excellent aero would still be a midsized sedan with lots of legroom and storage space. There would be no lifestyle change entailed from say, a Ford Fusion, other than the fact that the car is now electric. The car would simply look a bit different. That is really it. In return, it would save the user money and accelerate faster at higher speeds for a given power availability, and charger at a faster rate in terms of miles of travel.
The automakers never seem to want to stray from their current brand identity. That is why massive wheels and grilles and fake vents and plastic cladding are all the norm right now, everywhere. None of this is necessary, and getting rid of it entails zero lifestyle change on part of the vehicle operator, other than perhaps less expenses over the vehicle’s life. Which is probably why the auto industry doesn’t want to give up that zeitgeist. Cast aluminum rims designed to be delicate and crack over potholes, narrow rubberband tires that easily flatten, trim pieces that delaminate and fall off, screens everywhere, all that crap costs the buyer money, makes the vehicle more difficult to repair, and generally makes the vehicle worse to live with. But it makes the industry money by extracting it from consumers, and that’s why we have it.
As for answers to your questions regarding battery degredation/lifespan while charging, that depends upon the battery selected. There are batteries out there available off-the-shelf that can handle repeated fast charge cycles without degradation. Charging in the cold is a thermal management issue. Whether you can charge 8-10 cars at a time rapidly is an issue local to the charging station being used. Tesla has mostly worked out the real-world engineering problems more than a decade ago, and so has GM and Ovonics 3 decades ago. All that remains are minor gripes, or at least they would be if we weren’t trying to charge up 3+ ton road hippos with 100+ kWh battery packs.
Hey Toecutter Driver61 had a recent video about formula E and the new gen 3 cars that are to come out soon.
I think the video mentioned the gen 3 cars have a 38? KWH hv pack and are designed to last for 1 hrs. of competitive track time
And have a recharge rate of 15C!
No mention of the expected pack lifetime
https://youtu.be/YA0tDh7djRc?si=55XEWR9DQUHhbOBQ
Want to see what REAL recklessly fast battery charging looks like? Check out hobbyist drone pilots.
No way does 38.5 kWh last an hour of racing conditions on most tracks unless the cars are making no more than roughly 80 kW, assuming half the time is spent accelerating at full throttle. However, it is claimed the Gen3 is making 350 kW. The video claimed a charge lasted 45 minutes of racing. I suspect that the track this time was quoted for must be specifically designed to minimize the use of the accelerator and favor steady speed kept through corners.
The Gen2 cars had 54 kWh, for comparison. The Gen 3 lost 60 kg by losing some batteries, and appears to have increased rang on the track. Looks like the cars may have gotten more aerodynamically slippery to enable this. Not max downforce designs, for sure.
This small 38.5 kWh battery can also charge at 600 kW. If mass produced and re-designed for ironclad reliability, even if at the expense of 10-20% of its charge speed, this would be the perfect battery size for a road-legal family sedan or small wagon, with a platform focused on aero slipperiness, and an eye toward reducing production costs. 38.5 kWh in an Aptera would exceed 350 miles range on the highway, so slightly more than half that range should be possible with a decently slippery more-mainstream car.
I think you’re right, that video incorrectly states the hv battery pack as 38.5 KWH capacity.
Acct. To this article (below) the gen 3 cars hv battery pack capacity is 51 KWH (and yes this article confirms that’s down from 54 KWH in the gen 2 car), which seems much more realistic.
Also nice to see overall weight of the vehicle is down and power is up, plus increased top speed now of 200 mph.
https://www.powerelectronictips.com/formula-e-gen3-smaller-batteries-regen-and-fast-charging-faq/
I’m not sure about startups here, maybe south of the border and if they can pass regulations we might get them here, or of course China.
I do hope whatever remnants there are of the ones that fail, especially if they were onshore here, legacy automakers snatch them up. Like Rivian could be a new Dakota with a different front, or Lucid could be Chryslers, I’m just saying Stellantis could use some help on the EV front.
I don’t believe lucid or rivian will die, for the reason you mention. Both of those are good enough now that if they go under, I firmly believe a legacy automaker will buy them out for pennies and then leverage the tech and maybe the nameplate to their own benefit.
Another reason for Tesla — Elon Musk had lots of money from his PayPal stake and he spent nearly all of it.
He benefitted from a silly stock market too.
Which is why he got in such a panic and started building in tents when “production difficulties” nearly meant it all went down the drain…
Elon had roughly 330 million when he joined Tesla in 2003 and he was splitting his money between Tesla and Space X And yes the most famous “almost broke and both companies almost went under” moment did happen (I think around Christmas of 2008)…
So while $165M certainly plenty for any 1 person and he could have easily have retired… that is chicken feed, “we need to be super careful bc we have very little money” for an automotive company
I recently acquired a Renault K-ZE in China, the first in a long line of rebadging jobs resulting in various Nissans and Dongfengs, and its latest form is of course the Dacia Spring.
Renault stopped selling cars in China four years ago (manufacturing never stopped though), but thanks to the Spring’s massive success in Europe there’s a massive glut of spares and accessories on Taobao, and I don’t worry much about parts availability or repairs.
Guess that’s a tiny benefit for me thanks to the huge and messy Chinese EV export conundrum -_-
With GM’s Ultium platform, Kiundai’s GMP, Ford, and Tesla, plus a number of other assorted players, any EV startup is going to need to find a good niche if they want to have any chance. Aptera, if it ever goes to production, may have some success in the high efficiency niche. Good spots for a new player would be EVs with classic car reproduction exteriors (though that could run afoul of intellectual property protections) or anything else that could woo buyers at relatively high prices. If a new player can start with something truly affordable, they could also find success, but starting from scratch makes that difficult.
The other way we get new EV “startups” would be to spin off divisions of existing brands, but I don’t think that really counts as a new startup.
The truth is that Tesla had a number of advantages that cannot be replicated at this point. Selling carbon credits, name recognition, and limited competition built Tesla in a way no one can do now. The people who have the money for a luxury EV can buy an actual luxury EV at this point, and the people who want status can buy a brand that will impress. When the Model S launched, it was the nicest EV around, but a newcomer would have to do better at this point.
Even the companies that are around now are in danger. Rivian is no longer the only pickup available and probably doesn’t offer enough to justify the premium price for most buyers. I’m hoping that the R2/R3 is enough to keep them kicking, and that the R1 sales have been enough to get the R2/R3 to market. Canoo probably isn’t going to make it to market without significant outside intervention. Lucid is going to need to do something differently to sell enough to stay afloat. And all of them are going to be in competition with expanding lineups from better-known brands, so it’s not going to get better for them.
I think that the concept is alright, but the fact that they’ve taken so long to come to market has put them well behind the competition. If they’re still targeting 200 mile range (which the website still lists, but I don’t know how often they’ve updated any of that info), they’re going to compete with bigger cargo haulers that can go farther, and the only thing they’re offering is a quirky appearance.
A few government contracts for something like 10 total vans certainly isn’t enough to fund any real redesigns or improvements, so I don’t see them making the changes they’d need to make it competitive.
It took Tesla over 10 years to turn a profit, and then it took a few *more* years to turn a profit solely from the cars themselves.
Elon is a billionaire and was already so before Tesla, so he could put as much as he wanted to into Tesla.
I really want Rivian to succeed because they have cool colors and even a green interior too 😀
Also, at least RJ Scaringe is an adult.
I’m still convinced that there’s a large unmet demand for EVs downmarket of the bulk of existing offerings. Nissan still sells every Leaf they bring in, old and short-ranged it may be, and GM’s already probably sold off its’ entire stockpile of new 2023 Bolts.
Lucid’s problem is that even in decontented Pure form the Air is a $70k luxury sedan. Rivian’s is if they can get the R3 into production before someone else finally moves into that space.
I suspect the R3 will still be in the 50s/60s
They’re currently saying MSRP will start in the low $40Ks. So … yeah. At least $55K by the time this thing launches.
Of course there’s an unmet demand for cheaper EVs. There’s an unmet demand for cheaper housing and free beer, too.
We’ve seen the Dropkicks a couple of times, they always put on a great show and for some reason a fight always breaks out in the pit.
Will the presumably blue-collar workers and management in these small to medium auto supply companies be swayed with sharing $50MM? At first it seems tiny, but the reality is petroleum powered cars and trucks are going nowhere and suppliers will be heavily needed. This may give those looking to convert operations a nice reason to consider doing so sooner.
I see parallels here to other technological advances over the course of late industrial revolution. Doesn’t that usually mean less decent jobs? Junior may need to consider a career change if he’s young enough. Or maybe a more recent example would be coal mining and its supporting industries.
And best of luck to your friend’s son. Good on you for supporting.
Will there be new EV startups? Absolutely! In China.
Over here? Probably not barring some dramatic jump in energy storage technology. I honestly hope Lucid and Rivian make it because I like their products but have much less optimism for the other EV manufacturers.
You share my thoughts. Unless some startup comes in with some fancy new battery technology, I don’t think we will see anything new in the US except perhaps in the commercial space (and then it’ll probably be a joint venture of existing automakers). I also hope Lucid and Rivian make it, as I like their products. If I had the need (and money) to buy an EV today, the R1S would be my first choice.
The startup window is basically closed at this point. People who don’t know much about cars will either go to the legacy automakers or buy a Tesla. Those who do keep informed will tend to shy away from new manufacturers lest they wind up like the Fisker Ocean owner who had her vehicle totaled due to a dented door and broken hinge because replacement parts are unavailable. Buying a new car, especially in the luxury space that most electric startups play in, is one of the biggest financial decisions that most people make and the possibility of winding up with a $100000 brick will doom further growth in the EV marketplace.
Can’t Lucids use Superchargers now?
The Grand Touring is the EV I would buy if forced to buy an EV. For as long as I have freedom to buy something else though, I’ll just keep advocating for them to improve it.
I will say that Lucids are really gorgeous cars, to the point where the drivetrain is almost secondary to appeal, the Air would be just as (maybe even more? In some ways) desirable with a gasoline straight six under the hood. Also, the battery range is seriously impressive
The thing that would really keep me from one, were I able to afford one, is that lingering doubt about the company’s long term future. Sure, they’ve got a deep-pocketed investor bankrolling them right now, but they’re going to have to be able to stand or sink on their own at some point
A PHEV or gas-engined Lucid would be awesome.
It would be very interesting to see a development where an EV startup pivots to making ICE of some kind. But it could be a necessary development turn, one that might be relatively easy if they bought complete powertrains from an existing manufacturer, say Mazda for example.
I don’t think “backtracking” was the intent from anyone in this conversation. Adding another revenue stream is the intent. They have to grow their market. Its an avenue in which that could potentially occur. NOT exploring it, at least theoretically, would be terrible business management. Will it happen? Unlikely. But strange things happen when one is exposed to the likelihood of extinction.
Probably the biggest reason this would never happen is the design ethos for Lucid. They’ve said from the start that they designed the car from the ground up to be as efficient as possible for an electric powertrain. I’ve got to believe that most of the other EV startups have done the same with their entries.
If you want to talk future production, then sure, maybe. However with the current headwinds against ICE power, I doubt there’s a whole lot of investment left for solely ICE vehicles. We’ll likely see continued refinement of ICE powerplants to fit within an electrified lineup, at least until fully electric cars are all you can get.
If the Lucid Air were given say a Skyactive inline-6, it would probably exceed 40 mpg highway thanks to its low drag.
Will the Supercharger network remain an advantage or become the next Electrify America after Elon fired the team?
But Raylan drove a Lincoln Town Car.
Yeah at this rate having supercharger access isn’t looking very promising and may soon be the network with the worst up time now that the technicians that maintain and repair them have been shown the door.
The people who maintain the supercharger network and build the equipment are still there, although only 80-90% of the head count they had one month ago. It was only the people coordinating new locations and installations that got canned.
I fear the future state of the supercharger network will look a lot like the current state, except with upgraded equipment and longer cables. There are still gaps in coverage on highly traveled routes. Someone else has an opportunity to plug those gaps.