British Petroleum, aka BP, aka aka the folks who brought us both the Deepwater Horizon disaster and the Texas City Refinery Explosion, is not necessarily a company you might associate with vehicle electrification here in the United States. The news, then, that BP us ordering $100 million worth of EV chargers from Tesla might be a surprise. It shouldn’t be.
It’s Friday, folks, so I’m gonna take a little tour through the 20-F annual filing of British Petroleum as a warm-up, and then we’ll talk about vehicle affordability (or lack thereof). More strike updates? Let’s have more strike updates.
Honestly, by the time I’ve finished writing the first section of The Morning Dump we’ll probably have more strike news and I’ll have to start over. Perhaps I should start writing faster.
How BP And Tesla Make Sense
If you’re in the United Kingdom, the idea of BP as an EV-charging firm is probably not so outlandish to you. The company’s EV consumer-facing business, called BP Pulse (formerly Chargemaster), has more than 5,000 public charging points stretching from the English Channel all the way up to Scotland. It’s basically the UK’s Electrify America.
In the United States, BP Pulse stations are few and far between outside of eastern Washington State. I was looking at the BP Pulse stations nearby and it looks like all the ones in the northeast are basically perfectly designed to get an executive from their home in suburban New Jersey to their summer house in a tony neighborhood on the north shore of Long Island.
Seriously, look at this:
A coincidence, I’m sure!
I mention those two disasters in the lede of this morning’s Dump not merely to throw shade on the company, but because they’re important to understanding why BP is doing this. The Deepwater Horizon spill was one of the worst natural disasters in American history and resulted in the largest fines/settlements levied by the government against a company. Overall, the disaster has cost BP more than $65 billion.
The Texas City Refinery was sold, in part, to pay for Deepwater-related expenses and to (at least temporarily) wind down some refining operations, as noted in tthis article from The Guardian from 2012:
BP has been keen to scale down its refining operations, where profit margins are thin. The company is confident of reaching its $38bn target by the end of next year, although it has not hoisted the “for sale” sign over any other assets.
BP took a $38bn charge related to the Gulf of Mexico disaster. So far it has spent $14bn cleaning up the oil spill; paid out more than $8bn in claims; and agreed a settlement with the Plaintiffs Steering Committee – which represents affected individuals and small businesses – which is expected to cost the company another $8bn.
In the last two years, the company has pivoted to a broader strategy called “performing while transforming,” which is to say it’s going to keep the petroleum thing going and use that money to try some other green stuff.
Looking at the company’s 2022 annual report, it’s clear BP is doing both. While it’s easy to be super cynical and call this greenwashing, BP’s plan appears to be to freeze its upstream production of traditional hydrocarbons at about 2.3 mmboe/d (millions of barrels of oil equivalents per day) for the next few years and wind down to about 2.0 mmboe/d by 2030. Given where oil demand is going, this seems sensible (especially in light of the company’s divestment from Russian petroleum company Rosfnet).
At the same time, the company’s consumer division is expected to grow. The most serious sign that BP means what they say is the purchase earlier this year of TravelCenters of America for $1.3 billion. EV charging is a real estate and utilities game, more than anything. Placement along major traffic nodes with access to power is key and, while Tesla got an early lead on Electrify America, TravelCenters of America has about 280 sites primarily located on key highways.
With most major automakers in North America switching over to the NACS/Tesla charging standard, the $100 million worth of Tesla’s chargers makes a lot of sense. From the company’s press release:
The roll-out is planned to begin in 2024 and locations will include key sites across the bp family of brands, including TravelCenters of America, Thorntons, ampm; and Amoco, as well as at bp pulse’s large-scale Gigahub™ charging sites in major metropolitan areas and at third-party locations, such as Hertz locations, as part of previously announced collaborations. The first installation sites have been identified in Houston, Phoenix, Los Angeles, Chicago; and Washington D.C.
If BP is actually serious about offering a competitive charging experience as part of its diversification in the United States, it’s impossible to do that without NACS-style chargers, and who better to buy from than Tesla itself? Add that to the TravelCenters and it gives BP a huge potential leg up in the interstate/long-distance charging game.
This is the first time that a company that wasn’t Tesla has purchased Tesla’s superchargers for an independent network, but I doubt it’ll be the last.
There Is No ‘Magic Wand’ For Vehicle Affordability
Automotive News hosted a conference for dealers this week in Chicago called the “Automotive News Retail Forum: Chicago” and what it may lack in pizzaz, it more than makes up for in panels covering topics I am interested in.
Specifically, a panel made up of consultants and dealers talked about vehicle affordability (or the lack thereof). It’s pretty grim.
Yup, affordable models are on the way out, to be replaced by… nothing? It gets worse:
It’s gonna be a long wait.
Also, should I have gone to this? Sounds like my kind of party. Maybe next year.
Tesla Raises A Price In China
It turns out I can’t embed Weibo posts (Weibo is China’s equivalent of Twitter/x, but probably less accommodating to propagandists). After numerous price cuts, it looks like the price of the Model Y High Performance is being raised bout $2k, at least according to Tesla’s official Weibo account. It’s been a while since we’ve seen a Tesla increase, so this is newsworthy.
Ford Misses Q3 Earnings, Estimates Loss Of $1.3 Billion From Strike
Ford’s got a tentative deal with the UAW and Q3 revenues rose 11% to $44 billion. Good news, right?
Not quite. According to the company’s Q3 filing, the company is withdrawing its profit guidance for 2023 and the company’s adjusted earnings per share of $0.39 was lower than the $0.45 per share expected by analysts. The reasons? Ford points to the strike, EVs, and lingering quality issues.
On the strike, Ford’s CFO John Lawler said in an earnings call:
In the third quarter, the strike had an EBIT impact of roughly $100 million, and so far, the strike has trimmed about 80,000 units from our plant. This would reduce 2023 EBIT by roughly 1.3 billion.
Morgan Stanley analyst Adam Jonas also asked about hybrid vehicles and the margins they offer and I thought this was interesting:
There’s added costs as you’d expect for the battery and the motors, etc. But if you look at — let’s just take F-Series, for example. If you take the hybrid on average, they have a higher margin than our highest-volume gas versions because of the mix and what we have in the vehicle and the pricing we can get for the hybrid technology and the fuel efficiency that comes along with that. And one of the things we learned about hybrid, because we’re executing very differently than our first-gen hybrids, is we have Pro power on board.
We have a lot of other attributes that people are willing to pay for, you know, like F-150 powering a jobsite or your house as back up energy. That’s another advantage of having those batteries that maybe some of our competitors haven’t had the same pricing power. The F-150 now, a hybrid, is up 40% year over year, and we think the new F-150 new hybrid will be 20% mix, and it may be the best-selling hybrid in the United States. So, our hybrid strategy is a little different than our competitors because the work cycle for our products are different, but hybrid has a really big place.
We’re trying to challenge ourselves, Adam, to execute hybrids, so they do more than just propel the vehicle for pricing power.
I will say this until I’m blue in the face but: Hybrids have huge potential in the market and it’s where Toyota, Honda, and Ford can be extremely competitive.
The Big Question
How long is your memory for disaster/scandal? Did you stop going to BP stations? Did you stop buying Firestone tires? Did you drive past VW dealerships? Do you vote with your pocketbook?
I avoided BP stations for a bit, but that since worn off.
I’ve never bought Firestone tires, but not because of the Explorer issue.
I bought a post-dieselgate CPO VW TDI Sportwagen because the warranty was great and I was about to engage in a much longer commute. This was Nov 2019 and I started the job in Feb 2020. 5 weeks later I was on permanent work from home. I sold the car that summer for more than I bought it for, losing only a small amount in total cost, despite buying from a dealer and selling private party.
> Weibo is China’s equivalent of Twitter/x, but probably less accommodating to propagandists
Shots fired.
It makes sense BP owns Amoco…
https://en.wikipedia.org/wiki/Amoco_Cadiz
I didn’t need Dieselgate to convince me to drive past VW dealerships. My disdain for them goes back much longer, and involves my time in used car sales at a Ford lot with a Germanophile used car manager who kept buying Jettas and Golfs from the auctions, and them inevitably having major electrical gremlins and being unsellable.
Firestone was just that one OE tire on Explorers, but they’re also expensive for what you get, so I haven’t bought a set since… 1998? My daily currently wears Nokians, and my fun car came with Goodyears that are still in good condition so I can’t justify the expense of replacement at the moment.
BP owns Arco in the PNW, so it’s unavoidable if you don’t like paying the “Big Name Surcharge” for Chevron or Shell.
I stopped using BP for two reasons. First, the mpg I get with it was always less than any other gas brand, and they’re the only brand that said I pumped more gas into the tank than it could physically hold. And that happened twice at, at different stations.
Come on Ford, just do it! Put a PHEV system into your vans, bigger ones included. I really want a PHEV in a Sprinter-scale van. Ford has the Transit, so just do it! I’d drive that around locally for our 10 mile wide town and hybrid it for our 700+ mile trips to family. And be able to have that hybrid power for boondocking.
While I don’t consider these Natural disasters I think they are man made causing disasters in nature. But unless it is a conscious decision to cause the problem I leave the company off the hook. I think most of the expenses come from protests who have no solution but due to their grade school education and sycophant political morons money that could help keep disasters at bay is being wasted dealing with 3rd graders supported by 4th grade level journalists.
Flush:
Wellllllll…I’m tweeting way, way less, that’s for sure.
Is it still tweeting or is it xing?
It’s still a tweet. Bro needs to stop trying to make X happen. It’s never going to happen.
I am just riled of x previously known as twitter.
Can we talk about how those panelists were named Lindsberg Pettway and Augustin Wegscheider?
I tend to prefer using BPs (and Ampols) here in Aus because I often get coffee etc from petrol stations and theirs is pretty good imo. Put it this way we doing the environment a dirty ourselves whenever we are burning fuel in our cars and bikes whatever the brand on the pump
I stayed away from Firestone for a decade. Now I stay away because there are better products, though the last set of Firestones didn’t fail, they didn’t last much beyond 20K miles.
I stayed away from S&W and Ruger for about a decade. Will probably not buy Goodyear for a little while until they wake from being woke. I cut down on Coke because I’m too white for them and I’m sure they’d rather not have my so called white privilege earned money. Not going to buy another LG washer because of their painfully obvious designed obsolescence and my reluctance to replace the spider arm and bearings every 10 years. Never another Gateway computer, but they took themselves out the market. Never another GM car because I owned two already and that’s enough.
wait…what does your word salad mean? Goodyears are good to avoid because they suck, but wat woke wat?
And wat Coke wat? I assume you live in the south or are south adjacent and can say more?
Because those two nuggets look dumb.
I just bought a set of Goodyear Eagle Exhilarate and honestly they are pretty great tires. The reason I initially started looking into getting Goodyear was this. Our former president told his fellow Americans to NOT buy Goodyear ( I learned they are really the only wholly American made and owned tire brand along with Cooper) because he was having a hissy fit that employees there were not allowed to wear his shitty hats on the job. Imagine telling your countrymen not to buy from an American made/owned company which is supporting those very same countrymen. You can not get more un-American/un-patriotic than that. So much for being on the side of Americans and supporting American business!
Goodyear does make good tires, but my choice to take a pass on them is due to there being other good tires out there from companies that support social causes that I better align with.
I will take your word for any Goodyears being OK. I know their off-road tires have been considered junk for some time, so I haven’t even attempted to get them. I did have some Assurance tires that were fine for being OEs, but were not great in the different weathers that I deal with.
It’s obvious that you don’t keep up with each of those company’s ‘social’ department decisions and mask that ignorance by posting a semi-comprehendible comment about where you think I live and something about chicken “wat” nugget salads.
Boils down to Goodyear supporting causes that I don’t align myself with and therefore will not indirectly support by buying Goodyear tires when there are good alternatives out there.
Look up Coca-Cola’s internal corporate culture guidance on “being less white” and how rather than lifting up non-white culture, put down one culture. I believe that we all rise better together when it comes to race relations.
What an embarrassing post for you.
Of course I don’t keep up with that crap, as none of those things are as in my face as Musk’s train wreck of a life. And don’t forget that Teslas are a pile of shit anyway, and always have been.
Sadly, feel free to wave your little T-Rex arms around bemoaning what anyone does: Goodyear tires have been shit for ages, but feel free to jump ship NOW because of some perceived social slights. And I don’t drink soft drinks at all anyway so I could care less about what Coke does.
Your last sentence is the only good sentence, but I had to wade through your stupidity to get here, so good for you.
Troll. Incoherent and illogical troll. Have a nice life.
see, it hurts when you’re wrong doesn’t it
stop posting your garbage
Wasn’t it Firestone and Ford mix? Neither was bad on its own but combined the issue was somewhat dangerous depending on driver and maintenance?
Yeah I don’t remember.
Firestone tires installed on explorers at the factory had delaminating sidewalls, and the explorer itself had a rollover issue at the time.
If I recall correctly the air pressure as specified by Ford was much too low for that tire, and this is why TPMS became a thing.
Whut
As far as The Big Question goes, I just circumvent the issue by buying used whenever possible. Seriously, why do we obsess over new things? What’s so great about new? New isn’t better, that’s all marketing, and marketing lies to your face half the time.
Was my ’66 Ford built by a moral company? Heck no! But given that I’m like the fifth owner, who cares? It’s a good car, it’s pretty and reliable. And I can appreciate the engineers and designers who made it at least. Some rando in the 60s supported an immoral company so I don’t have to. Now if I try to take good care of it, I can feel like I did my part by not being wasteful.
Same with my Miata except I’m not aware of anything particularly messed up that Mazda’s ever done. Whatever it was, it’s in the past and since I bought it used, I don’t care.
A lot of other Big Question things can be mitigated by growing some of your own food or building things yourself instead of buying pre-made items. Y’know, things that used to be common, that everyone did. And people were proud of building things and growing things, it gives you a sense of accomplishment. People are weirdly resistant to that nowadays, probably because they weren’t exposed to it and never gave it a try.
If I had my way, we’d go back to things being made by craftsmen instead of corporations, and building things to last for generations rather than until a new version comes out… but my way isn’t profitable and we conflate money with happiness because it’s easier to measure.
You make a great long winded point. If we are going to attack and dig in to everything a person and company and dead people who worked for a company did we will never solve anything. It is why the Israeli and palliistineans keep fighting. I mean it can’t stop because both sides have been attacked. So they must keep attacking. It is like the frigging beginning of Monty Python and the Holy Grail and everyone getting sacked. We need to shutdown the poorly educated college snowflake. Slap some real history and common sense into them and destroy the radical professors who delight in controlling students instead of educating them.
Whut
To be curt no one is perfect. If we refuse to follow any direction because one of the people involved once said something stupid, or acted in a way everyone did during their time on earth but is now inexcusable we are not going to ever improve anything. Palestine attacked Israel and Israel attacked Palestine. So can’t stop them they must keep attacking each other until all are dead on one side.
Anyone here old enough to remember the opening credits of MPATG and able to copy and paste the complete sacking credit scenario?
You were making perfect sense, and +1 for the Python reference, until this bizarre salvo
> We need to shutdown the poorly educated college snowflake. Slap some real history and common sense into them and destroy the radical professors who delight in controlling students instead of educating them
Yup, I was nodding along until this bit, then cue the sound of screeching brakes.
Okay I ask do you or anyone on staff have a business, economics, or accounting degree? It really seems many columns don’t get the business reality ponts of the world. And as much as I love and support the site it is only fair some of these columns take into consideration real world facts and consideration. Maybe if he has time Beau could train the staff in real world business and economics.
pleeze say moar
No, really. Econ sucks as a topic, but I’d like even a small taste of what you mean. I have my ideas…but I didn’t post first.
Oh it definitely makes the article suck because boring. But just like a poorly written TV show if the plot is just impossible the show sucks then too. I don’t want articles about finance, business etc just have the basic facts covered in articles about manufacturing and sales and production etc.
Nah econ sucks because it is a social science that likes to give off the pretensions of a hard science when deep down they know that their models are far from predictive or rigorous and instead serve to uphold the status quo.
Well I am no expert and it is an inexact science but it is correct in wasteful government spending results in a recession. Now a bit of flexibility is inevitable but just putting the government mint people on the money press and running non stop is a lesson in total stupidity. And yes both parties, despite Republicans claiming they are the party of fiscal responsibility, are ultimately destroying the economic clout of the USA.
I don’t bother retaining much memory around the poor things these big companies do because well, I’m sure the ones we hear of are just a drop in the bucket and I’m sure they are all equally bad.
I will however never buy another Chevrolet or Samsung product, I have never owned one of either that hasn’t inexplicably failed me.
there are a lot of these. It blows my mind that even the local Chevy/Buick/Meh dealer will tell me that the 3.6 motors in Traverses and Acadias etc. are garbage and will self-destruct, and the entire world knows this…but it neer, ever comes up in reviews. Ditto the Equinox motors, for that matter. I would post the grenaded Acadia motor I had if I could post pics here as a “ask me how I know”
I used to stay away from Waffle House because of how my lovely wife and I were treated at one on our honeymoon. We went in and were promptly ignored by the staff. When we left, they chased us in the parking lot, asking us what was wrong. Didn’t go back for DECADES.
Then, one spring break, I was taking my three kids to Six Flags Over Texas. It seemed like a day for making poor decisions, so we kicked off at a Waffle House! I ordered the hash browns all the way. It had EVERYTHING on it. Literally EVERYTHING. Gravy. Ham. Cheese. Chili. CHILI!?! Can you believe that? It was incredible.
Then we rode rollercoasters all freakin’ day. Didn’t hurl once.
So Waffle House is back in rotation.
And instant diabetes from the sound of it. ????
Lemme tell you, it. Was. GLORIOUS.
Chain restaurants are only as good or as bad as the management and workers on duty. Really corporate staff has no idea what goes on at any store. But before you complain look up Karen’s at restaurants videos pay Real attention to after 2am, I was there many years not WH, but others, dealing with drunks on top of everything else kinda saps your soul.
As a matter of fact if you ever went out drinking with a group and closed down the bar and went anywhere to eat and had a bad or great time you deserve to be botched slapped because you are not as funny or witty as you think you are.
How long is my memory? I still haven’t forgiven Consumer Reports for their assassination of the Suzuki Samurai.
As for inexpensive, entry level cars; I could go the usual route but this time I will say that maybe if companies paid their employees what they honestly earn, we would be able to afford todays cars. In fact, can any of you afford a new car with what you are paid at the Autopian?
yeah, but that was super dirty, so the hell with them. They’re really useful if you know what you’re looking for in reviews, but generally elitist idiots, so
I sure can’t afford one but I don’t think paying more is the sole reason. I mean say McDonald’s starts paying their workers double. Well government takes 30% or more. But They then have to charge 50% more. The employees will have more money to spend and could afford more stuff at the old prices but everything is costing more. Hey even the guys landlord has to raise the banks have to raise the interest rate to cover their higher costs. I believe it is the government printing and spending trillions on nothing but payoffs. If you pay $1:million dollars for a house worth half a million dollars that houseis still only worth half a million dollars.
My argument is that the price of things goes up without the pay of workers going up. Raising the wages of workers will help offset the rising prices a little bit and people like to spend for feel good things.
Yes my arguments are not a failure proof solution to solve the problems, they don’t aren’t the answer. But an argument to educate it isn’t as simple as raising the minimum wage. Frankly if you gave everyone a million dollars after all was said and down everyone except for a few businesses would actually be worse off.
Look at Covid aftermath the government threw trillions at the problem without consulting knowledgeable experts outside government. And there are no experts in the government industry except how to pass laws to get reelected. It helped for like 2 years. Now students are screwed and government says well just have tax payers pay it off by forgiveness of billions. Interest rates have doubled. Banks are in trouble. Government response forgive the debt and let tax payers cover the loss. Progressives are once again protesting. Now we invested billions in nuclear power that they said was cheap and clean and safe. Not 100% so they say shut it down and let tax payers cover the losses. Coal is dirty use natural gas. Natural gas prices go through the roof. Poor people can’t afford to heat and cook. That’s okay government says let tax payers cover the losses.
Now anytime government spends any money beyond basic operations it is using the economy profits to instead pay for programs. Now those programs may have a good intentions they might even be a great investment. But when they just stop considering the cost/benefit it hurts everyone. And yet the morons in government are who we allow to make these decisions carte blanc.
Yes there are dozens of different people I would trust over the untrustworthy political trades.
Who do you think is best suited to decide?
First, sorry for the late reply.
Who do I think is best suited to decide? If it’s between corporations or government, I choose government.
Corporations have one mission: Maximize profit. What’s the best way to maximize profit? Reduce overhead. What is the largest overhead? Employees. People. Wages, Insurance, Retirement programs, ect… are the biggest drains from profit. Reduce the amount of people in a company while sustaining or growing sales, territory, product inflates the profit margin. Get rid of all the employees while sustaining the chosen market gives a 90%+ profit margin. Only the owner gets paid. But if every company achieves this, then they all collapse because there is no one there to buy anything.
Government has its own mission. Do what’s best for the area. (Notice I said area and not people. Totally different things.) Governments want their area to grow in wealth, health, and volume if possible. To do this they create job opportunities, places to shop, eat, live, play, and even die. The crushing flaw with government is that it is provincial in its vision and action. Both in the area and the people running it. Too little business and it’s a poor area. Too much business and it’s an environmental disaster. (Pollutes water, soil, air) Too many people and a high housing prices. Too few people and its harder to find work and get a good quality of life.
That’s the real goal here. Good quality of life for everyone. That doesn’t mean that everyone is a zillionare. No. It means that everyone gets to live comfortably while in their means. For example: A person who decides to make cashiering at WalMart their s work gets to afford a nice, small house in a crime free neighborhood with good schools, and clean water. Someone who went to college gets to afford a house with crown molding and walk in closets. So on and so forth.
The problem right now is that the cashiers in our country can’t afford that small home and there are teachers out there with such crushing student loan debt that they turn to porn to make extra money. (Then get fired from their teaching job for trying to make the money to catch up so they can continue teaching.) That’s why I am happy for the Unions winning. They are giving their workers the opportunity to get that house; to pay off debt without having to resort to a second job (porn or not).
If the corporations won’t share their profits to help those that created these profits through their hard work, and if the employees don’t have unions to help them out, then there is no choice but to turn to government to haphazardly try to equalize things.