AD #2946 – China EV Market to Take Off; GM to Make Nikola Badger in 2026; Kia Moving to EVs Faster Than Hyundai
October 27th, 2020 at 11:50am
Listen to “AD #2946 – China EV Market to Take Off; GM to Make Nikola Badger in 2026; Kia Moving to EVs Faster Than Hyundai” on Spreaker.
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Runtime: 9:20
0:07 China EV Market Expected to Take Off
1:02 Market Manipulation Case Against Former VW CEO Dropped
1:37 GM to Make Nikola Badger in 2026
2:57 Fuel Cell Passenger Cars Won’t Become Mainstream
4:22 SEAT Testing Parts Made from Rice Husks
5:20 Daimler Cleaning Up Air in Its Buses
6:09 Magna Expanding Its Manufacturing Footprint
7:29 Kia Moving to EVs Faster Than Hyundai
8:13 Hummer EV Won’t Be Sold in All GMC’s Dealerships
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CHINA EV MARKET EXPECTED TO TAKE OFF
And we begin today in China where sales of electrified vehicles are expected to take off in the next five years. According to the China Society of Automotive Engineers, sales of electric, plug-in hybrid and fuel cells, what China calls New Energy Vehicles or NEVs for short, will hit 20% of overall all-new car sales by 2025. That’s up from 5% this year. And by 2035, they’re expected to reach 50%. The study predicts that 95% of NEV sales in 2035 will be battery electric cars, while the rest will be plug-ins. The researchers also say that carbon dioxide emissions from China’s auto industry will peak in 2028 and fall to 20% of peak levels by 2035. China is expected to sell around 1 million NEVs this year.
MARKET MANIPULATION CASE AGAINST FORMER VW CEO DROPPED
Good news for former Volkswagen CEO, Martin Winterkorn. Prosecutors in Stuttgart have dropped a market manipulation case against him. Prosecutors were investigating whether he manipulated markets by not disclosing the company’s diesel emission scandal sooner in 2015. But he’s not in the clear yet. Winterkorn is facing another criminal case in Germany for his role in the diesel cheating. The Stuttgart prosecutors dropped their investigation because Winterkorn will likely receive a harsher penalty in his other case.
GM TO MAKE NIKOLA BADGER IN 2026
Even though GM and Nikola have not signed a final agreement, it sure looks like their partnership is going to go ahead. AutoForecast Solutions reports that GM will start making the Nikola Badger pickup truck, but not until 2026. That truck will be made at GM’s Plant Zero, the new name for its Hamtramck assembly plant in Detroit. That plant will also start making an electric Chevrolet pickup truck in 2022. It will be available in both long and short wheelbase versions.
FUEL CELL PASSENGER CARS WON’T BE MAINSTREAM
There’s a lot of activity in developing fuel cell powered Class 8 semi-trucks. And it looks like we could see them delivering cargo in the near future. But what about fuel cells for passenger vehicles? On Autoline After Hours, industry expert Paul Eichenberg explained why hydrogen powered passenger cars aren’t going to become mainstream.
Paul Eichenberg
“This is something I would tell you, we probably do 150-200 expert interviews with the OEMs over the course of the year around electrification. And whenever we ask the question around hydrogen for passenger cars, I think if you look out in the next ten years, you may see ten, eleven, twelve thousand units. But it just has some challenges that I think, electrification is just going to be a simpler way to deliver. They of course use basically the same type of power electronics and everything, it’s just the sort of the fuel source. But I think from everything we’ve seen, all the work that we’ve done, it’s just there’s not a demand, there’s not an interest at the OEM level from a light vehicle standpoint that’s really pushing this technology.”
SEAT TESTING PARTS MADE FROM RICE HUSKS
Automakers testing and developing renewable materials is nothing new in the auto industry. And now Spanish automaker SEAT, which is part of the VW Group, is launching a pilot program to produce parts using rice husks. Why rice husks? Well there’s plenty of it. Around 140 million tons of rice husks are produced worldwide every year, most of which is just thrown out. SEAT is taking the husks and turning it into Oryzite, a material that can be mixed with other thermoplastic compounds. The new material is being tested on trim components in the SEAT Leon, including parts in the rear hatch, the floor of the trunk and its headliner. SEAT is currently testing the new material to see if it is as durable and safe as the materials it uses now. Not only is the new material more environmentally friendly, it’s also lighter, which can help further reduce the weight of a vehicle.
DAIMLER CLEANING UP AIR IN ITS BUSES
Bus travel has greatly reduced during the pandemic, so Daimler is cleaning up the air inside its buses. It’s now equipping its buses with multi-layer filters with an anti-viral coating to remove fine aerosols from the air. When these filters are used with the air conditioning system where fresh air is exchanged quickly, critical values considered to lead to infection are not reached. Daimler says the filters are available for all its touring buses.
MAGNA WANTS TO EXPAND MANUFACTURING FOOTPRINT
Supplier Magna is looking to expand its manufacturing footprint. As we said in a recent report, Magna has produced over 3.7 million vehicles under contract from other automakers. That all comes from its main plant in Austria, but it recently opened another facility in China and now it’s eyeing the North American market as well. Magna says the North American plant would be able to produce vehicles with any type of powertrain, but it wants to focus on battery electrics. However, for the plant to ever get off the ground, it will require contracts with at least two different companies. Magna is already making vehicles for BAIC, BMW, Jaguar, Mercedes-Benz and just announced a deal with Fisker. So, it’s not crazy to think Magna could get a couple of OEMs to sign on. And the fact that the supplier has its own EV architecture will make it even easier for companies to jump on board because they’ll have less to develop themselves. Magna’s plants in Austria and China have the capacity to build 170,000 and 180,000 vehicles, respectively, and if it opens a new plant in North America with a similar capacity, that means Magna could produce over half a million vehicles a year.
KIA MOVING TO EVs FASTER THAN HYUNDAI
Speaking of EVs, Kia wants to move into electrics faster than parent company Hyundai. The automaker says it wants 20% of its global sales to be BEVs by 2025, so it will offer 11 electric-only models by that time. Kia also wants to get into PBVs or purpose-built vehicles, like those used for deliveries or ride-hailing services. As we know, parent company Hyundai invested in Canoo to develop vehicles on its EV platform, so maybe Kia will take advantage of that partnership too. This is all part of Kia’s ‘Plan S,’ which will require a $25 billion investment to make it happen.
HUMMER EV WON’T BE SOLD IN ALL GMC DEALERSHIPS
Like other specialty models, the Hummer EV will not be sold in all dealerships. While it’s sold under the GMC brand, only about half of GMC’s dealerships have currently signed up to sell the electric vehicle. It sounds like the big roadblocks are the costs associated with upgrading a dealership to sell, service and charge up the trucks. That’s not too surprising, given our current environment and the fact that the majority of the Hummer EV variants won’t be out until 2024.
And don’t forget to join us for Autoline After Hours later this week. Joining John and Gary, is economist Charles Chesbrough, from Cox Automotive, who will share his outlook for the auto industry. So be sure to tune in this Thursday at 3PM eastern time.
But that’s it for today, thanks for watching.
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Comments (26)
October 27th, 2020 at 12:09 pm
It seems many of the regulars here have no clue what carbon credits are, and view them as an ‘unfair’ burden to polluters and also an unfair reward to the SELLERS of these credits to the polluters. SO I ask you, if the economist in AAH knows this particular branch of the SCIENCE, to explain to these unrepentant Tesla HATERS why they are NO HANDOUTS, they are 100% fair and appropriate and as they should be. It is NOT just that they are part of the Tesla Business plan. They are RIGHT. I only hope they were applied NOT only to Cars but to OTHER polluting sources, especially power mowers, of whom there are millions, and which are far more polluting than a car.
October 27th, 2020 at 12:15 pm
“GM TO MAKE NIKOLA BADGER IN 2026″ – if GM relabeled the Hummer EV as the ‘honey badger’, the problem is solved. The Hummer EV needs a smaller cousin.
“FUEL CELL PASSENGER CARS WON’T BE MAINSTREAM” – nor any other because no one is building out a hydrogen fueling network. California has a government subsidized, ~40 station collection to support ~10,000 private, many leased, cars. Only the port of Los Angeles works because Toyota provided both the vehicle and fueling station. This sure sounds like the Tesla model.
“MAGNA WANTS TO EXPAND MANUFACTURING FOOTPRINT” – ah ha! The compliance manufacturer so folks don’t have to buy Tesla credits. The world needs more inefficient, overpriced, and under performing EVs.
October 27th, 2020 at 12:19 pm
1) Or you could view the credits as a tax on the middle class to favor the purchase of cars that only the rich can afford…which is exactly what it is doing.
October 27th, 2020 at 12:22 pm
Sean here is an interesting article about the problems with edible types of materials being used in vehicles. You may have already heard of the problems with mice being attracted to the soy based coatings used in wiring. Not sure how rice husks will fair but could also be a problem..
https://www.thedrive.com/news/20878/rodents-are-feasting-on-newer-cars-soy-based-wiring-insulation
October 27th, 2020 at 12:24 pm
2 Magna are a serious player in building low volume cars. They are now building Supra and Z4 and, I think, M-B G-wagon. EVs are where the growth is, as far as contract car assembly.
October 27th, 2020 at 12:26 pm
Completely off-topic of today’s show, but yesterday I finally saw my first Harvester International Lonestar semi truck on the road. Up close and in-person, that thing is even more of a head-turner than the photos let on. Almost makes me want to be a truck driver just to sit behind the wheel of that thing.
October 27th, 2020 at 12:37 pm
1) Still whining about a segment from last weeks show. (eye roll) People not wanting their tax dollars wasted on expensive EVs isn’t a Tesla hating thing its a complaining of government subsidizing a particular industry.
2)What are you talking about? Magna expanding its manufacturing footprint doesn’t modify ZEV credits or make them a compliance manufacturer. It certainly wont change the purchasing of Tesla credits other than more EVs being produced makes them less valuable. Your a big supporter of EVs so what difference does it make if we have more with some being less efficient than Tesla?
October 27th, 2020 at 12:39 pm
When they build it or whether they build it, at least the Nikola (to my eye) is a good looking design, styling wise. And styling is as Peter D. says a major differentiator.
When you buy/sell carbon credits, the same amount of carbon is created (just diluted per total units); so it is fair, how. It’s just a transfer or monies, and while the incentive remains and as MERKUR describes, Mr. normal guy picks up most of the tab.
And I don’t know how to connect my observation that the California fires have created 25% more CO2 than the Nation’s vehicle emissions so far this year, it is a notable event worthy of inspection.
October 27th, 2020 at 1:25 pm
4 is right. Mice and rats living in parked cars is a real issue I have experienced. Giving them food increases the issue.
October 27th, 2020 at 3:30 pm
Just an observation: Tesla is not the only OEM that receives the ZEV credits, just the most prolific due to their volume of sales. Every OEM that produces a vehicle that qualifies receives the appropriate number of credits. That includes GM for the Bolt, FCA for the Fiat 500 EV, etc.
I think the number of credits being issued should also start to wind down after a certain number of units. The OEM’s that are buying the credits now would need to get serious about selling Zero Emission Vehicles, which would help to reduce emissions overall. Allowing polluters to keep using the “credit crutch” just slows progress on pollution reduction.
October 27th, 2020 at 3:38 pm
Forgive me if I am suspicious of vehicle debut predictions from AutoForecast Solutions. The last one they had on the next Grand Cherokee was off by two years.
October 27th, 2020 at 3:45 pm
11 Ιt may not be the only one but it is probably BY FAR the BIGGEST one. Tesla has already made more than 1 million BEVs. How many have FOrd or FCA, Tesla’s biggest customers for carbon credits, made?
In any case all above is irrelevant, the point is that econ illiterates here believe that carbon credits are somehow a handout BEV makers should not get. Which is 100% wrong, and when you tell these unrepentant illiterates, they accuse you of… whining? THe morons who cannot see that 3*1=3, or, equivalently, that for the price of ONE $113k so-called Hummer BEV, you can get THREE 39,700 CYBERTRUCKS, that also look far more striking. But that’s poor Lambo for you, to count to 20 he has to take off his shoes and socks.
October 27th, 2020 at 4:07 pm
9 I don’t know when fabric wire insulation, like maybe cotton was used, but when I was young, there were a number of cars in service with it. It was tasty to small rodents, and maybe some insects.
October 27th, 2020 at 4:13 pm
Why does the price of the Hummer bother you so much? Because it sold out in ten minutes and will be in customer hands before Tesla even finishes engineering and re-styling the Cybertruck?
Who cares how much it costs? I don’t hear any complaints about Bollinger, a truck that will carry a price higher than the Hummer. I am sure the Silverado EV will fill in the lower end of the price ladder for fullsize EV trucks.
As with any other market segment, there will be a variety of prices, models, ranges and capabilities to choose from. Tesla will have plenty of truck competition. Ditto for the semi truck market where those crooks at Nikola will probably beat Tesla to market too. Seems like Elon needs to concentrate on the less-Boring parts of his business empire.
October 27th, 2020 at 4:41 pm
It’s sounding like there will be a lot of electric pickup trucks on the market in a few years, but do more than a handful of people want them? I don’t hear pickup owners I know clammering for them.
October 27th, 2020 at 4:48 pm
I think it could be a case of the early adopters jumping in first and then assuming they have positive things to say, and the press reviews are positive, that more and more regular truck buyers will move into them.
Before too long, people are going to start worrying about resale values of ICE powered vehicles like they did in the final days of Oldsmobile, Pontiac, Saab, etc. Especially as more stories come out like the one yesterday on the companies deserting turbocharging production.
Once there are more choices and prices are more competitive with ICE vehicles, people will start to adopt EV’s in ever increasing numbers because most people prefer to own future technology vs yesteryear technology. Anyone else remember a story from roughly two years ago about the last VCR being produced in Japan?
October 27th, 2020 at 8:18 pm
Sean,
Have any of your sources said how much the investment will be for GMC dealers to sell the new Hummer?
October 27th, 2020 at 8:36 pm
16 I’ve heard that when Olds, Plymouth, and Pontiac were “orphaned,” the resale value wasn’t affected much, because you could still get parts and service at other GM and Chrysler dealers. I’d heard that Pontiac G8s, equipped the right way, are holding their value pretty well. When Studebaker went under in the 1960s, the value of the cars crashed badly.
With EVs, the bottom line is that, for now, even fast, sporty ones are basically commuter cars to most people. Furthermore, they are commuter cars for people with a house in the suburbs, as many of us wouldn’t have a way to charge one at home.
I’m not the only one who wouldn’t want to add 20% in the time to do a highway trip. Also, during the pandemic, fewer people would want to hang out in restaurants with other people talking about their cars during their extended pit stops.
October 28th, 2020 at 8:26 am
12 Larri, I’m not sure why I’m wasting my time trying to explain the most basic of math to you that my 4 year old grandson understands but I will try one last time. If you look past your hate for the Hummer you will see it has a base price of 80K and a fully loaded price of 113K. The Tesla pyramid truck starts Supposedly at 39.9K and loaded at 69.9K. So when comparing base to base and loaded to loaded the Hummer is never 3 times the price of a Tesla but I know you like to manipulate the numbers to look good for Tesla to fit your agenda. So if you are able to do basic math as you claim you’ll see the base is almost exactly twice the price and the loaded isn’t even double. Hopefully you don’t teach basic math or any other subject for that matter. Facts are facts and your feelings really don’t matter. All that and I did it with my socks and shoes on. If your still confused I will have my Grandson explain it for you. He gets it.
October 28th, 2020 at 8:45 am
15, 18 @Kit, I think that the industry is going after the BEV truck segment simply because packaging and weight are less of a concern. In addition to the fact that many people seem to want the large SUV and pickups but many cannot justify it from a MPG standpoint. So someone like a soccer mom who is driving a small CUV or sedan and isn’t really going far distances. Maybe to run kids to school, practice, the grocery store. The large BEV with even only having 200 miles or range could work well.
For a long time I couldn’t understand the push for BEV trucks either but much like the evolution that happened when manufacturers realized that a small compact BEV wasn’t desirable and they started to make decent sized often luxury brand BEVs they realize the Truck prices of 60K+ can support the cost needed to be competitive with ICEs and trucks and SUVs have a ton of space to place a battery.
Actually from a standpoint of whats been holding back the BEVs the large truck and SUV market makes sense. If people can own a large vehicle and not be worried about 15mpg and feel like they are helping the environment and were willing to pay 100K+ for an escalade then maybe they’ll pay that for a SUV that never needs gas. It may spark sales that have otherwise gone to CUVs simply because of the MPG difference.
October 28th, 2020 at 10:11 am
20 It will be interesting to see how the BEV trucks do. Like with BEV cars, you need a place to charge them, which would rule me out when in Florida. Also, if you drive them on highway trips, you need to add a lot of extra time to your trip. That would be even worse with big, draggy trucks than with cars like a Tesla S. We shall see.
October 28th, 2020 at 10:29 am
21–Kit, my particular concern with BEV trucks is what happens to range when towing. A significant chunk of pickup truck drivers use them for towing. MPG goes down almost by half in our F150 when towing a small RV trailer. Fine, since refueling is a matter of 10 minutes, it’s not a big deal other than $$. With a BEV, we’re a long way from that, if it ever does happen.
October 28th, 2020 at 10:43 am
22 I would expect the range of a BEV to decrease by a similar percentage to your F150, towing the same trailer. Then, unless they “split” the batteries of these trucks so they can be charged using two or more chargers at once, the charge time would be very long. A big BEV pickup truck or SUV would need to have a big battery, near 200 kWh to give 300+ mile range, when not towing.
October 28th, 2020 at 10:48 am
22) It is basically the same in EV world. Your range will be cut in half when towing a trailer.
Add into the fact that recharging while towing is going to be a big pain in the backside. Take the TESLA superchargers for instance. There is no possibility to charge your truck with the trailer still attached due to the way they are arranged. Well, unless you want to block access to every charger with your trailer. So, you will need to disconnect your trailer somewhere else, hopefully somewhere close where you can keep an eye on your trailer so nobody steals your stuff, and then go to the supercharger. Wait an hour for it to recharge, reconnect your trailer and repeat the process every 150 miles. That is not really all that practical and nobody will enjoy disconnecting and reconnecting a trailer just to charge up while traveling.
The BEV truck will be for those who do not do truck things until such time that recharge times and set-ups are more inline with expectations.
October 28th, 2020 at 11:53 am
“Electrification is easier” yes it is, but there is still pollution the ultimate non-polluting vehicle is a fuel cell powered vehicle. It may be a longer term program but it is a better solution.
November 5th, 2020 at 11:21 am
CHINA EV MARKET: Consumers in China do not want EV’s. The same reasons USA consumers are not buying EV’s (their only 1.6% of sales YTD). Their expensive, low range, long time to charge, and little/no charge infrastructure. Communist Chinese Party is mandating them. This is not free market. The narrative being pushed is that this is some sort of free or natural market demand that is a positive trend. It is not. Ever wonder why pollution in China is so high? It is because of cars? China also has huge human rights abuses, steals intellectual property, and forces government ownership in business. Let’s encourage free markets.