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Runtime: 10:19
0:08 More EVs Qualify as SUVs
1:41 What Makes an SUV an SUV?
2:25 Renault & Nissan Agree to New Alliance
4:03 Nio Launches Semi-Solid State Battery This Year
5:11 Nissan On Track for Solid State Battery
5:29 Electrify America Raises Rates
6:20 NXP Says Chip Shortage Not Over
7:46 Ford Cuts Exec Bonuses
8:24 Faraday Finally Gets Money to Launch
8:57 BMW To Make EVs In Mexico
9:18 Mexico Emerges as EV Assembly Center
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MORE EVs QUALIFY AS SUVs
Tesla just raised the price of the Model Y by a thousand bucks, we expect Ford to raise prices on the Mach-E, and Cadillac should be able to sell a lot more Lyriqs. Strangely enough, it’s all because the U.S. Treasury changed its mind on how it classifies an SUV. As you know, as long as an electric SUV costs under $80,000 it’s eligible for a $7,500 tax credit. The cutoff point for passenger cars is $55,000. And the Model Y, the Mach E and Cadillac Lyriq all cost over fifty-five grand and a number of versions were classified as passenger cars, so they didn’t qualify for the tax credit. But then the Treasury changed its mind and now calls them all SUVs. Here’s what changed. When it comes to calculating the Corporate Average Fuel Economy, or CAFE, the EPA uses one definition for SUVs. But on its website, www.fueleconomy.gov, where the public can search for the fuel economy of vehicles, the EPA uses a different definition, which is more in line with how the public perceives what an SUV is. So the Treasury changed to the public definition. Tesla and Ford cut prices on certain versions of the Model Y and Mach-E to qualify them as passenger cars. But when the definition changed, Tesla raised prices and we think Ford will do the same.
WHAT MAKES AN SUV AN SUV?
So what makes an SUV an SUV? There are several things. For CAFE, to be an SUV, a vehicle has to have 4-wheel-drive or a gross vehicle weight over 6,000 pounds. But on the EPA’s public website, they’re called SUVs as long as the luggage area is open to the main cabin and it has a flat floor, not a trunk well. At least one of the rear seats has to fold down for more luggage area. The roof has to extend to the rear of the vehicle, to create more luggage room. And the rear side doors have to open nearly 90 degrees to fit cargo in more easily. I hope you got all that. It can be kind of confusing.
RENAULT & NISSAN AGREE TO NEW ALLIANCE
Renault and Nissan pretty much patched up their differences and came to a final agreement that will hold their Alliance together. While some analysts are skeptical the arrangement will hold up over time, the two companies announced a flurry of projects where they’ll be working together. In Latin America, they’ll produce half-ton and one-ton pickups. Nissan will make Renaults in Mexico. And they’re going to come out with small, A-segment electric cars. In Europe, they’ll come out with a shared B-segment ICE car, a B-segment EV and a C-segment EV with an 800-volt architecture. In India, they’ll collaborate on ICE SUVs, an ICE sedan and possibly an A-segment EV. Under the old agreement, Renault had the upper hand in the Alliance. The new agreement pretty much makes them equal partners. And while Mitsubishi is also part of the Alliance, it’s very much a junior partner with not a lot of say.
NIO LAUNCHES SEMI-SOLID STATE BATTERY THIS YEAR
Chinese automaker NIO has got a giant semi-solid-state battery that’s going into production in the first half of this year. It’s a 150 kWh semi-solid-state battery that will debut in NIO’s ET7 sedan and provides up to 1000 km or 620 miles of range. That’s based on the outdated NEDC test cycle, so the real-world range will be lower. The batteries come from NIO’s Chinese supplier WeLion, which was founded in 2016 and also provides batteries to Geely. Solid-state refers to a solid, rather than liquid electrolyte in the battery cell. The benefits of having a solid electrolyte are better energy density and reliability, faster charging and they’re safer. But they’re hard to mass produce. Semi-solid-state, which typically has solid materials in a liquid electrolyte, is heavier and less energy dense, but it’s easier to make and offers many of the same benefits.
NISSAN ON TRACK FOR SOLID STATE BATTERY
Nissan may be one of the first automakers to have a truly solid-state battery on the market. It says it’s on track to have a pilot line producing solid-state batteries by 2025 and will have its first mass-produced EV with one of its batteries by 2028.
ELECTRIFY AMERICA RAISES RATES
The price of EV charging is going up. Electrify America announced it’s raising its prices at the beginning of March. For regular users, it’s going from $0.43 per kWh to $0.48 and for those who pay a $4 monthly fee it’s now $0.36 per kWh up from $0.31. Some of the 800 charging stations that EA currently operates still charge by the minute and those prices are up too. $0.37 per kWh instead of $0.32 for DC fast charging for regular customers or $0.29 up from $0.24 per kWh for monthly subscribers. Electrify America says it raised its prices because of rising operational and energy costs.
NXP SAYS CHIP SHORTAGE NOT OVER
Unfortunately, we’re not done with the semiconductor chip shortage yet. Chip maker NXP Semiconductor says there’s still multiple kinds of automotive chips that will have tight supplies throughout the year and will hold back production for some automakers. This includes both newer chips for EVs and some of the older chips that are more widely used throughout the industry. And we’ve already seen automakers like Ford and Toyota forecast struggles around chips for 2023. And even though it’s pretty staggering to see AutoForecast Solutions say by the end of this year a total of 18 million vehicles will have been removed from production because of the chip shortage over the years, there is still hope. NXP also says the days of millions of vehicles not being able to be built are behind us.
FORD CUTS EXEC BONUSES
Ford CEO Jim Farley said he’s frustrated with the company’s 2022 earnings and top execs at Ford are going to pay the price for posting a $2 billion net loss. The Detroit News reports that the company is cutting bonuses for upper management, including Farley’s, because of the poor result. Recalls, warranty costs and supply chain issues dragged down its earnings. But while top execs are getting a lower bonus, most other salaried employees will earn their full bonus and hourly workers will receive up to $9,100 in profit sharing.
FARADAY FINALLY GETS MONEY TO LAUNCH
Faraday Future is ready to crank up its assembly line. It finally got the money it needs to start making the FF91. The company’s stock jumped 28% in pre-market trading on the news, which is good because it had plummeted 92% since going public in July 2021. Production of the FF 91 is supposed to kick off in March and deliveries are supposed to begin in April. We say supposed because with this company you never know.
BMW TO MAKE EVs IN MEXICO
BMW is going to start making EVs in Mexico. It’s investing 800 million euros or nearly $870 million to build its Neue Klasse EVs at its plant in San Luis Potosi starting in 2027. More than half of that investment will go towards building a new battery assembly facility.
MEXICO EMERGES AS EV ASSEMBLY CENTER
And BMW isn’t the only automaker planning to build EVs in Mexico. The country’s Foreign Minister tells Reuters that Audi, GM, Stellantis and Tesla have all expressed interest in producing electrics there. He says the government will give automakers “all the facilities we can” and adds the country has advantages over the U.S. like lower export costs. EVs made in Mexico qualify for IRA subsidies and Mexico is also trying to attract more semiconductor and battery companies.
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Seamus and Sean McElroy cover the latest news in the automotive industry for Autoline Daily.