AD #2251 – New EV to Replace Acura ILX, ZF Stops Cars from Going Wrong Way, Dealers Hurting Electric Car Sales
December 12th, 2017 at 11:24am
Runtime: 7:32
0:32 Acura to Drop ILX for New EV
0:54 Glider Trucks May Have EPA Mandate Repealed
2:05 Ride Sharing Could Replace Most Miles Driven
2:55 Autopilot Reduces Insurance Rates in Britain
3:33 ZF Develops Wrong-Way Inhibit System
5:14 Suppliers Adapt to Boost Stock Prices
6:06 Dealers Hurting EV Sales
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On today’s show… GM says ride-sharing could take over 75% of all miles driven…. thanks to Autopilot, Tesla owners in England get insurance discounts…. and why car dealers steer customers away from electric cars. All that and more coming right up on Autoline Daily.
This is Autoline Daily the show for enthusiasts of the automotive industry.
ACURA ZAPS ILX FOR AN EV
Looks like Acura is going to trade off one model for another. Autoforecast Solutions reports that the plans for building the Acura ILX in Marysville, Ohio were cancelled. Marysville will stop building the 4-door sedan and it will be replaced with an Acura battery electric that goes into production in April, 2021.
GLIDER RULE MAY VANISH IN THE WIND
Have you heard of “gliders” that are used in the heavy trucking industry? Gliders are re-built trucks with refurbished bodies but don’t have a powertrain. Then, buyers can install re-built older engines. Back in 2015, the EPA mandated that gliders must meet current emission requirements but under the Trump Administration, the agency wants to repeal that rule. Consumers Union warns that gliders don’t have to meet safety regs either. They would be exempt from being equipped with things like electronic stability control, automatic emergency braking and V2V communications. Some trucking firms like gliders because they’re cheaper, but the big truck OEMs also don’t like gliders, since they’re a deliberate end-run around emission standards.
Still to come… ZF wants to make sure that people don’t drive on the wrong side of the road.
RIDE SHARING COULD REPLACE MOST MILES TRAVELED
General Motors believes it can make a lot of money with ride sharing services, but it all has to do with getting the cost down. Right now the cost for offering rides from Uber or Lyft works out to around $2 to $3 a mile. That’s kind of a high cost and limits those companies to only 1/10th of 1% of all vehicle miles travelled. But GM says if you get the cost down to a buck a mile, that opens up the market to 20% of all miles travelled. And if you get it under a buck, then ride sharing can compete with 75% of all miles travelled. GM has a plan to get that cost under a buck a mile around the year 2025. And it predicts that the market will then be worth hundreds of billions of dollars or 300 times greater than what the ride sharing services earn today.
| Ride Sharing Market Potential | |
|---|---|
| Cost/Mile | Market Potential (Miles Driven) |
| $2 – $3 | 0.1% |
| ~$1 | 20% |
| <$1 | 75% |
AUTOPILOT REDUCES BRITISH INSURANCE RATES
Tesla claims that crash rates on its models that use Autopilot have 40% fewer accidents. And now owners in Britain can get insurance discounts. The region’s largest auto insurer, Direct Line, is offering Tesla owners a 5-percent discount for switching on the car’s Autopilot system. Sounds pretty good except that Direct Line says it’s still not sure if improved safety from Autopilot justifies the lower premiums. It hopes the discount will encourage use of the system and aid research. Well maybe. Or this could just be some kind of promotional campaign.
YOU’RE GOING THE WRONG WAY!
Who knew that people driving down the wrong side of the road is such a problem? From 2004 to 2009 the National Traffic Safety Board says about 360 people a year were victims of wrong- way drivers in the U.S. and in Germany, last year alone there were 2,200 radio announcements of wrong way incidents. So ZF came up with a solution. The “Wrong-way Inhibit System” warns drivers with an acoustic signal, seatbelt vibration and an optical signal on the dashboard. Steering wheel resistance will also increase to tell the driver they’re about to go the wrong way. If that doesn’t work, the system will keep the car to the outside edge of a lane, gradually bringing it to a stop, turning on the high beams and hazard lights to warn other drivers. Wrong-way Inhibit will only allow the driver to back up or drive out if there’s room. ZF uses multiple technologies for the system, like detailed maps and cameras that read traffic signs and lane markings.
Why would car dealers steer customers away from electric cars? That’s coming up next.
SUPPLIERS ADAPT TO BOOST STOCK PRICES
We’re seeing major changes in the auto industry as suppliers are trying to boost their stock prices. Many traditional suppliers are looking to dump technologies related to the internal combustion engine, and get into electrification and mobility instead. Bosch, the largest automotive supplier in the world sold off its business for starters and turbochargers to Chinese companies. Delphi is spinning off its autonomous technology into a new company called Aptiv. And now Autoliv, the Swedish supplier of airbags and safety equipment, is spinning off its electronics business into a new company, but hasn’t chosen a new name yet. While Wall Street will applaud the move, there is a sense in some parts of the industry that this is just a bunch of financial engineering aimed at short-term financial gains that will not help these companies in the long run.
DEALERS HURTING EV SALES
Electric cars get outsized media coverage, but so far this year they only account for 0.18% of the American market. But maybe that’s because EVs face an uphill battle at dealerships. A study from the research firm Ipsos RDA shows that dealers steer customers away from EVs and toward mainstream models because that’s what they’re comfortable selling.The study also found some dealers have limited or no EV inventory and the ones that did seldomly offered test drives. There’s even a lack of marketing materials displayed or made available, a lack of designated sales people and the sales process can be inconsistent from one dealer to another. While many consumers have not hit the tipping point for switching to an EV, dealers could still do a better job selling them.
Don’t forget to join us this Thursday for Autoline After Hours. Our guest is Simon Sproule, the Chief Marketing Officer for Aston Martin. So join John and Gary for some of the best insights on what’s happening in the global automotive industry.
And that brings us to the end of today’s show, thanks for watching and please join us again tomorrow.
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Comments (20)
December 12th, 2017 at 12:27 pm
Maybe Dealerships are just trying sell what people want. For all the talk of all these Electric cars that will hit the road . There sure doesn’t seem to a lot of people wanting them yet. Maybe if the charge times equal what a fuel stop does and with the same frequency Oh and at a price that makes sense people will take them seriously ,but right now it looks like 99.82% of the people don’t.
December 12th, 2017 at 12:37 pm
I live in a small town and the Chev dealer here doesn’t sell the Bolt or Volt. Friend of mine who is a salesman there told me GM wants to much investment from the dealer to become an authorized dealer of that range.
December 12th, 2017 at 12:46 pm
Hopefully ZF’s solution to wrong way driving will not shut down a vehicle that is forced over to opposing lanes in a construction zone. Many bridge repairs move East traffic onto the West lanes and are typically narrow with reduced lanes. Add a stalled out car that can only reverse and that could get ugly.
December 12th, 2017 at 12:52 pm
I wonder if the sales commission on an EV is the same. With their upper price range and dealership owners not wanting them to stay on the lot long maybe they have little room to make money and prefer to sell a customer a car they will make a decent commission on. Just a thought.
December 12th, 2017 at 1:01 pm
A big problem with selling Chevy Bolt, is that they are apparently sold in only a handful of places. The Indiana dealer where I bought my Corvette doesn’t have them, nor does the nearby Chevy dealer in Florida. I know people both places who would be potential buyers.
December 12th, 2017 at 1:25 pm
Another reason that dealers aren’t crazy about EVs: they need less service, and Dealers make almost half their profit from the service department.
December 12th, 2017 at 1:33 pm
#6 Poilu Well between the EV cutting into mechanical repairs and AV cutting into bodywork then dealers better prepare for the loss in revenue.
December 12th, 2017 at 3:12 pm
While it will be a long time before EVs are popular, there’s no reason they shouldn’t be a viable option for customers at the dealership. Many dealers have spent big bucks for the equipment and training needed, but are being held captive by their sales people. It’s management’s fault for hiring these folks. Let’s get that 71% to 95%, clean house and get some help at hiring.
December 12th, 2017 at 3:21 pm
I shopped the three all electric cars available today and didn’t find them meeting my needs.
The leaf was too ugly, the bolt was a nice driving experience but the hard plastics and door stop styling put me off from actually desiring one. The tesla model S drove well but was too large and quite frankly I didn’t think it offered the value that I expect especially for 80 grand plus.
I thought the autopilot 2.0 was garbage compared to my previous tesla model S driving experience which was autopilot 1.0.
I drove these vehicles today and walked away unimpressed for one reason or another.
I have a 2016 reservation for the tesla model 3 awd and was surprised by my dismay of the model S autopilot today.
I definitelly will not pay 5 grand for autopilot 2.0 as it drives today. I may still pick up the model 3 base model with awd as a family transport as the vehicle is pretty, spacious, inexpensive and relatively quick. The range is fine and in my opinion for the money it reminds me of an Aston Martin rapids in looks…
Still I have about a year to go before my model 3 will be delivered because I ordered on the second day of the original release. That being said I have a reservation with jaguar or I should say my name is on the jaguar dealers list because they don’t know the price of the vehicle..but it looks very pretty and accelerates quite well according to reports. Again it’s a jaguar so I have my concerns with regards to driveability…
So that leaves VW and GM for its bolt derived Buick cuv…again depending on the styling…if it’s attractive and it’s out before the model 3 next year…so I’ll look at the Buick.
That’s about the whole story. Today’s 3 car lineup that have somewhat decent range…which I consider over 200 at minimum it’s really a two car lineup..
Hybrids with two powertrains are of no interest to me as a consumer. Absolutely none.
It’s too early to tell for sure….but the driving experiences to date lead me to believe the internal combustion engine vehicle is not long for this world. Love my corvette and I’m keeping it …but as far as regular family transports .,.and future sports cars I believe…ICE is over as costs come down for all Americans..who have a garage to charge up overnight.,,
I don’t see any reason to buy a gas powered vehicle competitor unless the cost is much less or the styling is better..which I’m sure it will improve,
I’m not a greenie, I don’t care about global warming…but from a drivers perspective.,,electric vehicles are superior driving experiences..
Just shooting the breeze as I mentioned…I went out and test drove them today as it’s been rumored the tax credit is in jeapordy by January 1 and I was curious if I wanted to purchase before then ..
Even loosing the $7500 tax credit the vehicles are not of interest to me today…so I’ll wait..and see the model 3 in person, the jaguar I pace as well as the upcoming Buick derivative of the bolt.,,
Technically the bolt is excellent..,I just can’t desire to own a vehicle styled in such a utilitarian manner. Believe it or not..even though not as fast as the model S 100d I thought it road better..both interior plastics were crap and that needs to change,
Good show, good questions…hopeful the variety of all electric ev s improves over the next few years..which I’m sure it will
December 12th, 2017 at 3:22 pm
Auto
Ilot 2.5
December 12th, 2017 at 3:49 pm
Today’s show hit the nail on the head as far as electrics. I could have told you that though; for the past 15-20 years I have been periodically enquiring at dealerships about hybrids/electrics (since the first Honda Insight & Toyota Prius in the late 90s). I still haven’t bought any, but it has been like pulling teeth trying to get any car salesman to find any information on them (as opposed to what is familiar to them) or locate one to test drive. Numerous times I have been dissuaded from even gathering info on electrics from dealerships. As a disclaimer, I haven’t tried lately for Prius info; now that they are more common I just ask friends that have them. I also haven’t tried at the local Tesla boutique near me.
December 12th, 2017 at 4:26 pm
If none of you have watched these two documentary movies on EVs they are pretty good.
“Who killed the electric car” 2006
“The revenge of the electric car”. 2010
They were available on Netflix streaming.
Interesting 10 years later.
December 12th, 2017 at 4:28 pm
Toyota dealers have generally had sales people who know about Priuses, and have had cars to test drive and buy, at least since the Gen 2 hit the market in 2004, and the car became “mainstream” with annual sales of 100K+. The new Prius Prime plug-in hybrid is a different story, though. By all accounts, it is a very good car, but Florida and Indiana dealers don’t sell it.
Beyond that, it seems that there is little support and dealer knowledge. I’ve found it hard to find dealer support or interest, even at Ford dealers, and they have some decent hybrids and plug-in cars. The Fusion hybrid is selling well, in spite of the dealers.
December 12th, 2017 at 5:58 pm
I bought a Hyundai Sonata Hybrid for my wife instead of a Volt simply because the sales staff at two separate Chevy Dealerships show no interest in demonstrating their Volt cars to my wife even after I told the Sales staff “She is your customer!” The Hyundai dealership had slick showroom displays and several cars for her test drive. She picked a color and they found the car in 30 minutes…all in the Southern California area.
December 12th, 2017 at 6:25 pm
#14 It looks like dealer experience will cost, and gain sales, involving cars that don’t even really compete with each other.
December 12th, 2017 at 9:33 pm
I’ve checked the Indianapolis area inventory several times since August and there is rarely more than 2 or 3 Bolts listed. Granted it’s cold in Indy this time of year, but you can’t sell what you don’t have, or can’t demo. There seems to be an ample supply of Volts in the area. Disappointing, but not surprising.
btw – The salesman I use at my local Chevy dealer has been there at least 40 years. He has a good client base with lots of repeats… I’ve probably ordered a dozen cars from him.
December 13th, 2017 at 8:04 am
The modern sales force is under educated compared to the previous generation. Add the different information needed for electric cars and sales people are even less competent. It does take an investment in new equipment and training for electric cars which perhaps the manufacturers need to work to reduce the cost to the dealer.
December 13th, 2017 at 8:28 am
In my personal experience most sales folks were exactly that “sales” people. They had a good general knowledge of the vehicles and could walk you through how to pair your phone and set your radio preferences. When it comes to technical aspects and sometimes what available engine offerings they needed help. One salesman even tried to tell me the vehicle was offered with the bigger V6 which was the only engine offered in that vehicle. So when faced with questions about how the EV works its expected battery life and other technical questions that they probably are not real sure about, I would bet that is part of the reason they avoid steering customers toward EVs.
December 13th, 2017 at 8:36 am
SouthEast Toyota apparently hates hybrids and plug-ins. So all three of our Prius including the Prime were bought outside of their region.
We had no trouble buying a new Camry, 1991, and minor problems with the new Echo, 2001. On the Echo, I had to walk to the door before they finally realized how hard they were working to NOT sell the fuel efficient Echo we wanted.
Bob Wilson, Huntsville, AL
December 13th, 2017 at 9:51 am
I kind of hated to do it, but I bought my 2017 Prius in Florida. The dealer was very helpful in getting exactly the car I wanted, and delivered directly from the port, so I was getting a new car, rather than one acquired from another dealer.
Still, SE Toyota Distributors are crooks, and have a $299 SET surcharge on the sticker for “inspection,” or similar. At least it wasn’t as bad as the $699 SET surcharge a few years ago. Also, if I had a place to plug a car in at my condo, I would have wanted a Prime, and would have needed to go elsewhere. SET still doesn’t sell Prius Primes, as far as I know.