AD #3563 – NEV Sales Slip in China; Lucid Burns Through Half Its Cash; 1st Fisker Returned to the Factory
May 9th, 2023 at 11:58am
Listen to “AD #3563 – NEV Sales Slip in China; Lucid Burns Through Half Its Cash; 1st Fisker Returned to the Factory” on Spreaker.
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Runtime:9:50
0:00 GM Snags Apple VP
0:44 Lucid Burns Through Half Its Cash
1:50 NEV Sales Slip in China
2:41 EU Told to Raise Chinese Import Tariffs
3:34 Mitsubishi Continues to Shrink
4:24 Was New Toyota Tacoma “Leak” Deliberate?
5:18 Ford Ready to Unveil the New Ranger
5:42 Consumers Wary of Subscription Services
6:41 Iveco Buys Out Nikola JV Shares
7:18 NextEra to Invest Heavily in Green Hydrogen
7:52 First Fisker Returned to the Factory
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GM SNAGS APPLE VP
General Motors just snagged the former vice president of engineering from Apple’s Cloud Services. Mike Abbott will report directly to GM’s CEO and Chairman Mary Barra. He’s going to lead a new organization at GM that will combine all of its software activities for vehicles and digital services and for both retail and commercial customers. GM recently said it would not offer Apple CarPlay or Android Auto in its EVs, and would develop its own system instead. And getting a guy from Apple adds more credibility to its effort.
LUCID BURNS THROUGH HALF ITS CASH
Lucid Motors reported its first quarter earnings and the numbers show that the EV startup is still struggling with production. It only delivered 1,406 cars, which brought in $149 million in revenue. That’s up 159% from a year ago. But it posted a net loss of $779 million which was 858% worse. Lucid also burned through nearly half of its cash and says it only has enough to last about a year. It plans to deliver 10,000 cars this year which would generate about a billion dollars in revenue. But its expenses in the first quarter alone were $921 million. So it’s on track to lose between $2 and $3 billion this year. Even so, many analysts believe that the Saudi Public Investment Fund, which already invested $1.5 billion in Lucid, will step in to make sure the startup has enough money to keep going.
NEV SALES SLIP IN CHINA
Uh-oh, here’s something that we didn’t expect to see. Sales of new energy vehicles in China fell 3.6% compared to March, and lost a percentage point of market share. ICE sales were up slightly, but the Chinese car market seems to be struggling to gain traction after several years of severe Covid lockdowns. Analysts believe part of the problem is that Chinese consumers believe that they should wait to buy a new car because prices will come down. Tesla started slashing prices in January and several other Chinese car companies followed suit. The China Passenger Car Association says Tesla’s recent price increase was meant to be a signal to customers that they better not wait.
EU TOLD TO RAISE CHINESE IMPORT TARIFFS
Chinese brands are just getting going in Europe but other carmakers are starting to get worried about them. The CEO of Peugeot, Linda Jackson, said Chinese-made EVs pose the biggest threat to Europe’s automakers because they’re good vehicles that are priced competitively. And a new study from German auto insurer Allianz says that Chinese built EVs could cost European automakers $7.7 billion a year in lost profits by 2030. The report says policymakers need to boost tariffs on imported Chinese EVs. Carlos Tavares, the CEO of Stellantis, says the EU only charges a 10% import tariff, while China has a 15% to 25% tariff on European imports.
MITSUBISHI CONTINUES TO SHRINK
Mitsubishi used to sell over a million vehicles a year worldwide, but last year that dropped to only 834,000. Its sales in Europe were almost chopped in half. In China they were down 41% and they dropped 15% in North America. And though its operating profit nearly doubled to $1.4 billion in the first quarter of this year, Mitsubishi expects its net profit to fall 41% for the full year.
DID TOYOTA DELIBERATELY “LEAK” THE TACOMA?
A war over mid-size pickup trucks is about to kick off. Toyota is going to reveal the all-new Tacoma on May 19th. We’ve even shown off a few of the teasers when we reported about its first-ever hybrid powertrain. But what looks mostly like a fan forum, called tacoma4g.com, is showing off this image of what it claims is the new version of the pickup truck. It says it used links from the Toyota website for previous images of the Tacoma and changed the parts that indicated model and model year. And that’s how it got the picture. If it is the new Tacoma, it should come as little surprise that it bears a lot of resemblance to its big brother, the Tundra. In a response to Automotive News, all Toyota would say is that it “looks forward to the official reveal on May 19th.”
FORD READY TO UNVEIL NEW RANGER
Toyota is probably not happy about the leak but it got a leg up on Ford. The new Tacoma leaked today and tomorrow Ford officially unveils the all-new Ranger. It used the Raptor version of the mid-size pickup as the highlight in this teaser video, but like the Tacoma, the new Ranger should be available with a hybrid powertrain as well.
CONSUMERS WARY OF SUBSCRIPTION SERVICES
Automakers are banking on subscription services to be a big revenue stream but a study from Cox Automotive found that consumers don’t know much about them, and they don’t like them. Only 21% of respondents were familiar with the services. Nearly 60% said they would be too expensive and 70% said they would shop for another brand if certain features were only available through subscription. And there’s concern over data security and privacy. But some shoppers liked the idea of trying out a new technology without having to fully pay for it. The five features buyers are willing to pay a monthly fee for are remote start, vehicle locator, heated seats, dash cams and a digital key. And Tesla, Jeep, Dodge and Ford buyers were more likely to say they’re willing to pay for subscription services.
IVECO BUYS OUT NIKOLA JV SHARES
Nikola and Iveco had a joint venture to make electric and hydrogen powered heavy trucks. But now Iveco is buying out Nikola’s shares. It’s paying $35 million and will give back 20 million shares to Nikola. Iveco, which is based in Italy, will now focus on the European market, while Nikola will focus on North America. But the two companies aren’t completely severing ties. Iveco will retain 5 million shares of Nikola and they’ll continue to share and develop technology and Iveco will continue to supply parts to Nikola.
NEXTERA INVESTS HEAVILY IN GREEN HYDROGEN
The Inflation Reduction Act or IRA isn’t just bringing new EV investments to the U.S. it also provides generous tax credits for hydrogen projects. NextEra Energy, which has the highest market cap of any power company in the U.S., will invest more than $20 billion in green hydrogen production. While demand for hydrogen fuel is low now, NextEra believes new laws and an increased push to reduce emissions will drive growth in the market.
FIRST FISKER RETURNED TO THE FACTORY
Last week Fisker delivered the first Ocean to a customer in Denmark. But Bloomberg reports that the car had to be returned to the factory because software issues made it inoperable. Sources say the software bugs could take months to fully iron out, and earlier today Fisker cut its production forecast for the year by as much as 10,000 units. It now expects to make between 32,000 to 36,000 Ocean SUVs. The delays have something to do with integrating the software, so it’s sending out vehicles with more basic software that limits functions. But it looks like that’s not even working.
And that brings us to the end of today’s show. Thanks for making Autoline a part of your day.
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Comments (25)
May 9th, 2023 at 12:15 pm
I made this comment on yesterday’s show, but it is more relevant today:
Lucid Motors is doing a tour of the Southeast. Over the weekend, they had 5 Lucid Air vehicles on display in the suburbs just north of Atlanta. I test drove an Air Grand Touring (they did not have a Sapphire), and it was very impressive. It drove great, awesome acceleration, and the regen braking made for interesting driving.
The regen could take a little getting used to, but I think I would like it. There were two different settings for how much regen, normal and high (for one pedal driving), but I didn’t feel too much difference -both settings seemed to stop the vehicle when I let off the gas, like driving a golf cart. It may be a more noticeable difference driving at highway speeds.
The “host” was no-pressure, as he said that GA laws prohibited him from discussing sales or even prices, so he was full of information about the vehicle’s features, but said I would need to go to the Lucid website for any pricing info. If you click on my name above, it takes you to lucidmotors.com and you can see the “starting prices”. They are supposed to be the most luxurious, longest range, and fastest vehicles, but as impressive as they were, they are out of my price range!
May 9th, 2023 at 12:31 pm
Glad to hear that consumers are wary of the subscription services. Let that idea die the horrible death it deserves! The only subscription service I’m willing to pay for is satelight radio and thats only because with service in one vehicle it allows me to also stream it from my phone too, so I can listen in all my vehicles and at home or in the garage. As long as consumers look elsewhere for vehicles that dont require a subscription then manufacturers will be forced to give up on that horrible concept.
May 9th, 2023 at 12:34 pm
Lucid needs something less expensive than the $87.4K entry level model. Well, checking their web site, it looks like the entry level model is not available, and the cheapest one is $92.9K. For now, it looks like they are having trouble producing what they have.
I hope the Saudis will keep feeding them money, and they can survive. They have a good product, but they can’t lose money like that forever.
May 9th, 2023 at 12:37 pm
People say they will pay a monthly fee for a digital key. I’d just refuse to buy a car that charged a monthly fee for something that is standard on $27K Prius.
May 9th, 2023 at 1:06 pm
@2 Around 20% of new U.S. vehicle sales are leases. I would consider a vehicle lease a subscription. You pay on a monthly basis, you don’t own the vehicle and you turn it in.
If a lease is like a subscription, many people are already used to it.
May 9th, 2023 at 1:49 pm
5 IDK I think a lease is much different than subscription service, in that you still get all the options you paid for. That lease payment is based on base price plus options and residual value. Most leases are closed end leases so you also know what the cost is to buy the vehicle at the end of the lease. So regardless if you bought or leased the car the options are figured into that cost.. But to then hold the buyer hostage and only offer to flip a switch to turn the option on with a payment is just icky to me.
So will vehicle manufacturers have any legal grounds like cable companies did when a hacker is able to turn everything on without paying their fee? I mean its my car and the option is there so if I figure out how to access it without their help am I liable for a lawsuit? Certainly they could void the warranty but if I dont care about that then I wonder how that will work?
May 9th, 2023 at 1:54 pm
5,6 Would turning on the heated seats for the duration of the lease be part of the lease payment, or you you make a separate payment to the car company?
May 9th, 2023 at 2:04 pm
Perhaps Lucid started with too many variants and models?
Simplify manufacturing and try to reach profitability. Then add models as needed.
May 9th, 2023 at 2:30 pm
#1, 2, 8.) Personally, while I could never afford one, the base price for the Lucid Air may not be far off. When you look at the premium Model S, the EQS and the i7, it seems to be price competitive with those vehicles. Does it offer the same content at that price? That’s another story. It’s the higher price versions that get to be sticky, versus what the legacy OEMs offer in their EVs. Yet, while the legacy brands may offer better appointments, more reliable delivery and an established automaker behind each vehicle they produce and sell (I’m looking at you Fisker!), neither Tesla or the legacy automakers has yet produced an BEV with the range or power that Lucid has put on the road to date! Is that worth $200K? Some may think so!
May 9th, 2023 at 2:31 pm
7 I would think if they proceeded with this subscription service the lease payment would not include the heated seats and then you would pay a monthly fee on top of the lease payment to have that option. Especially since the lease may be three years and you might only want heated seats for 2 winters. Either way stupid idea and I will avoid any car that requires monthly fees to keep options turned on.
May 9th, 2023 at 2:44 pm
#2, 4, 7.) When EVs can can be 100% refueled in less then, say, 20-to-30 minutes and travel between 300-to-400 miles on a single charge, then I could see paying a temporary subscription for full self driving. It would be something that could be used on long trips, but not used most of the year and, because of that, not something is would want to pay for when I initially purchased/leased said vehicle. Yet, maybe that wouldn’t be a subscription, but more of a rental of the download-able software.
May 9th, 2023 at 3:06 pm
Lucid burning through cash,wow those are some big numbers. Not for the faint of heart.
May 9th, 2023 at 3:13 pm
I wonder where (BMW) car companies got the idea that heated seats would be candidates for a monthly fee. Why not power steering or even better air conditioning and floor heat? I think windshield defogging might be a safety requirement.
Good luck on making it a monthly fee item. Of course, without Apple CarPlay and Android Auto, GM are no longer in consideration for us even with the $3,000 rebate for the Bolt battery inconvenience.
May 9th, 2023 at 3:35 pm
13 Porsche and MINI don’t have Android Auto, but I bought them anyway.
It sounds like Lucid must have some “production hell,” putting out so few cars. If they get the volume up, and can sell what they build, it would help cash flow a lot.
The Lucid Pure with RWD is about the same price as the cheapest Model S, which is 4WD. The RWD Lucid Pure is not listed on the fueleconomy.gov, so may not actually exist. The 4WD Pure, for $5500 extra, has about the same range as the Model S. Did Tesla drop all but one version of the Model S? Only one is listed on fueleconomy.gov.
https://www.fueleconomy.gov/feg/Find.do?action=sbs&id=46307&id=46207
May 9th, 2023 at 3:39 pm
Tesla continues to be the best at adding lightness. A Model S is ~600 pounds lighter than a Lucid Touring, and ~1200 pounds lighter than an EQS.
May 9th, 2023 at 3:54 pm
13) Maybe now that GM is hiring someone from Apple to lead their software group, maybe GM will reverse their decision to exclude Carplay.
May 9th, 2023 at 5:02 pm
16 Tesla has hired people from Apple, but they have neither CarPlay nor Android Auto. I’d think if GM has a lot of people boycotting because of dropping them, they may reconsider. Tesla reconsidered making steering wheels unavailable in Models S and X.
May 9th, 2023 at 5:11 pm
If that is the new Tacoma, I think it looks good. But I would not liken it to the Tundra (which is hideous, IMO).
May 9th, 2023 at 5:40 pm
A few years down the road….
A) want to buy a used car, you ask or read does the car has heated seat ? what answer will I get ?? or if I’m selling that said car, how should I answer. B) About at a dealer, what answer will I get from the pimpled face sales person ?? Being told by X car company that I have to pay X amount of money for heated seats when there is a button on console to turn on/off said seat !!!
Bulls*&^ !!
May 9th, 2023 at 6:14 pm
#11 wmb – Cross country in my 2019 Tesla Model 3 consists of: (1) first drive +3 hrs; (2) subsequent segments 1.5-2.5 hours.
Close to the Supercharger, take a biology break and short drive to the charger. Charging takes 15-30 minutes depending upon how close the next SuperCharger. Meanwhile, snack, stretch, or cat nap.
My rule of thumb, 700 mi in 14 hours. My longest segment, 30 hours over 1,300 miles.
May 9th, 2023 at 6:37 pm
Ladies & Gentleman,
A.)The only subscription that is worth it’s weight in”Solid Gold” is Sirius XM.
B.)Global Auto manufacturers are Money Opportunists, why you say,Subscription service,Leasing a vehicle – Huge profits and warranties just to name a few.
C.)Way to much Technology which drives the selling price of acquisition either to purchase or leasing.CPU failure in a vehicle will kill you.Remember “Murphy’s Law”???
Thank you for paying attention in reading this comment.
May 10th, 2023 at 7:46 am
20 When I’m traveling I like not having to plan my trips around the distance to the next gas station. Or filling up just enough to get to the next station. Sounds horrible. 700 miles would take me about 10 hours so adding an extra 4 hours also sounds horrible. But I’m not retired.
May 10th, 2023 at 8:28 am
21 It’s time for me to “negotiate down” the price of SXM for my Highlander. I’ve been told that you need to say you want to cancel three times to get the best price.
May 10th, 2023 at 11:56 am
23 Last time I was offered a SXM deal (several years ago) the rate was $6/mth.
May 10th, 2023 at 11:57 am
23 Let us know what you get it down to?