AD #3488 – EV Startups at Critical Juncture; Proterra Quits Manufacturing in California; NIO Loses Lawsuit to Audi
January 20th, 2023 at 11:49am
Listen to “AD #3488 – EV Startups at Critical Juncture; Proterra Quits Manufacturing in California; NIO Loses Lawsuit to Audi” on Spreaker.
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Runtime: 9:28
0:08 EV Startups at Critical Juncture
0:55 Lucid, Rivian Costs Are Sky High
1:34 Proterra Quits Manufacturing in California
2:32 Alpine Eyes U.S. Market
3:50 Hertz Launches EV Fleet
4:29 Mercedes Pays €7,300 Profit Sharing
4:54 NIO Loses Trademarks to Audi
6:22 Design A Twingo with AI
7:15 Honda Going to The Moon!
7:49 Bridgestone Develops 1st All Terrain Tire for Exotics
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This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
EV STARTUPS AT CRITICAL JUNCTURE
If you want to play in the automotive industry, you better get ready to play hardball. It’s a hyper competitive, cut-throat business that can chew you up and spit you out before you even know what’s happening. And that has been a rude awakening for a lot of EV startups. While everyone is focusing on how Tesla’s stock price fell 67% from its peak last year, Rivian and Lucid are down even more. Bloomberg reports they’re down nearly 90% from their IPO price, which has triggered a massive drop in their market cap. At one point Rivian was worth $153 billion. Now that’s down to only $14.5 billion. Lucid was worth $91 billion. Now it’s $13.7 billion.
LUCID, RIVIAN COSTS ARE SKY HIGH
And it doesn’t look like this is going to turn around anytime soon. Reuters reports that the money Rivian and Lucid get for selling their vehicles is less than the money they’re spending on materials and labor to make those vehicles. And it’s a big gap. Rivian’s cost of goods sold, or COGS, is 2.7 times higher than its revenue. Lucid’s COGS is 2.5 times higher. So, they either need to figure out how to cut costs, or they have to raise prices, or they have to do both. But with Tesla kicking off a price war, now they’re really caught between a rock and a hard place.
PROTERRA QUITS MANUFACTURING IN CALIFORNIA
Meanwhile, Proterra, the electric bus company, is going the cost cutting route. It’s closing its assembly plant in California and moving everything to its plant in South Carolina. That will eliminate about 300 jobs and cut the company’s logistics and manufacturing costs. So, welcome to the auto industry folks, it ain’t an easy business.
ALPINE EYES U.S. MARKET
Alpine, which is part of Renault, is revving up its engine. CEO Luca de Meo wants Alpine’s sales to generate 8 billion euros by 2030, which means they have to sell roughly 150,000 vehicles a year. However, last year Alpine only sold about 3,500. But it only sells one model right now, the A110. So, Alpine it’ going to expand the lineup. That includes a reborn version of the Renault 5 in the second half of 2024, followed by a small SUV in 2025. Those models are expected to boost sales to roughly 35,000 by the time they launch, but to reach that 150,000 number, Alpine says it needs to get into the U.S. market. To appeal to Americans, it will launch two new electric SUVs, which will be roughly the size of a Porsche Macan and Cayenne. Will Alpine tap into a partnership it has with Lotus or dip into the Renault-Nissan-Mitsubishi alliance for these vehicles? That’s still under consideration, but the U.S. models aren’t scheduled to launch until at least 2027 or 2028.
HERTZ LAUNCHES EV FLEET
Rental car company Hertz has deals to buy EVs from Tesla, Polestar and GM and now it’s starting to deploy that all-electric fleet. It’s launching a new initiative in Denver, Colorado, called Hertz Electrifies, that’s all about supporting EV adoption. Hertz will bring up to 5,200 EVs to its locations around Denver for both private and ridesharing customers to rent as well as partner with bp pulse to expand charging in the area. And Denver is just the start. It also plans to launch Hertz Electrifies in other American cities, but didn’t say when.
MERCEDES PAYS €7,300 PROFIT SHARING
Good news for Mercedes factory workers in Germany. The company is giving them a profit-sharing bonus of up to 7,300 euros, thanks to its strong financial performance in 2022. Around 93,000 eligible employees get the highest bonus the company has ever given out since it started the profit-sharing program in 1997.
NIO LOSES TRADEMARKS TO AUDI
Chinese automaker Nio just lost a legal battle with Audi in Europe over the names of its vehicles. Last year, Audi filed a trademark lawsuit in Germany claiming Nio’s ES6 and ES8 names are too similar to its S6 and S8. And the court agreed with Audi. It ordered Nio to stop using and advertising those names. The judge said the names could cause confusion with consumers who might think that the “E” in the names means it’s an electric version of the Audis. Nio denies the infringement and says consumers won’t be confused since the Audi’s are sedans and its vehicles are crossovers. But either way, Nio is going to rename the ES6 and ES8 in Europe to the EL6 and EL8. But in China it’s a different story. It’s going to keep using those names there.
DESIGN A TWINGO WITH AI
Can you believe it? The Renault Twingo is turning 30! And to mark the special occasion, Renault is holding a design contest. But this is not your normal design contest. Instead it’s asking participants to use AI image generators to come up with their own, unique version of the Twingo. If you’ve never used one of these AI generators, like Dall.E, they’re pretty cool. You can type in something like ‘polar bear ice skating on the moon’ and it will generate a series of pictures of polar bears skating on the moon. Renault expects some pretty wild designs. It says “In flight, under water, in space, made of chocolate… The possibilities are endless!” It’s going to choose a winner and turn that design into a real-life show car. Want to try your hand at this? We’ve got a link in today’s transcript.
HONDA GOING TO THE MOON!
Honda is going to the moon! Seriously. It signed an R&D contract with Japan’s aerospace agency to develop a circulative renewable energy system. Specifically, Honda is working to combine a water electrolysis system with a fuel cell, so it can continuously produce oxygen, hydrogen and electricity as long as it has access to sunlight and water. This could be used for the Artemis Program, which will put people on the moon for extended exploration.
BRIDGESTONE DEVELOPS 1ST ALL TERRAIN TIRE FOR EXOTICS
Bridgestone claims it developed the world’s first custom-engineered all-terrain tire with run flat technology. It’s the official tire of the off-road version of the Lamborghini Huracan, called the Sterrato, which features a V10 engine, AWD and a raised suspension. Bridgestone calls the tire the Dueler All-Terrain AT002 and says it uses a new rubber compound with bespoke polymers that’s designed to optimize grip, while also providing the best possible handling and high-speed performance. It also features a specific shoulder pattern that provides additional grip in deep gravel and mud and it can safely travel 50 miles at 50 MPH with a puncture. I’ve got to imagine that’s a strong selling point for any off-roader, so hopefully this technology can be applied to other tires.
But that brings us to the end of today’s show and this week. Thanks for tuning in and I hope you have a great weekend.
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Comments (19)
January 20th, 2023 at 12:15 pm
Reality is just finally settling in for Tesla, Rivian and Lucid. They all had over-valued stock because everyone wanted to be part of the next new thing and thought it would be like Apple or Google. The reality of them still being in the auto industry and GM, Ford, BMW, and MB all are making EVs too is finally setting in and they are not so special. It’s an industry shift, no doubt but it’s still automotive in the end.
January 20th, 2023 at 12:18 pm
I agree with you on that! I suspect some of the OEMs that are lagging a bit in their EV efforts are still hoping to buy out one of the startups for pennies on the dollar!
January 20th, 2023 at 12:53 pm
If Hertz can make money leasing[renting] cars to Uber drivers wouldn’t it make sense for the Uber drivers to own their BEV themselves, $$$$$
January 20th, 2023 at 12:59 pm
Just like Hertz I am announcing that I will only rent EVs when I travel but I’m not saying when that starts.
January 20th, 2023 at 1:47 pm
This govt ordered switch to EVs to be sold is going to drive the whole country into a depression when all these business go belly up
January 20th, 2023 at 2:15 pm
It won’t be long before you see those Bridgestone off-road exotic car tires on sale at CostCo. Buy three, get one free. NOT!
January 20th, 2023 at 2:17 pm
Maybe all these weakened EV brands will merge into one company, come up with a very patriotic red, white and blue logo and call themselves American Motors! Its worked before.
January 20th, 2023 at 2:19 pm
Clem, our government has been putting companies at risk by using supply-side regulations to force customers into different buying behaviors for 50 years! Politicians realize demand side policies put their reelection at risk, so they’d rather put companies at risk. Shameful.
January 20th, 2023 at 2:29 pm
You do wonder how much companies like Alpine are smoking when they come up with their plans. The board doesn’t know what to do so they go along with management’s totally unrealistic plan. At least they get their 15 seconds of fame.
January 20th, 2023 at 2:30 pm
7 Chrysler still owns all the AMC trade marks as far as I know. that is why they have used many of the old model names like Spirit , Concord , soon to be Hornet Used Eagle as a brand right after the take over. Rebel is used on the RAM , All of my AMC hats and shirts are licensed through Chrysler
January 20th, 2023 at 2:32 pm
Alpine (renault) only has to look to their sister brand Fiat to see that it would be a huge mistake. People still remember the crap they sent over here in the 60 and 70s ( Le Car) anyone ?
January 20th, 2023 at 3:00 pm
another great week of all kinds of fun/interesting automotive info.
January 20th, 2023 at 3:26 pm
11 Fiat is Stellantis, not Renault.
As I understand it, Lucid is partly, or largely owned by the Saudi government. How much money, and for how long will they be willing to keep it going, hoping to become profitable?
January 20th, 2023 at 4:11 pm
13 Yep my mistake . Can’t tell one failed French brand from the other. LOL I know they are huge in Europe but none of the French and Italian brands of everyday passenger cars could ever get anywhere here in the states sales wise. The Germans and Brits handed them their lunches . most of the Brit brands here even the top end ones were very needy from a maintainence perspective. My Dad fixed a jag distributor that had a cracked case. If he couldn’t have got it fixed it was a 3-6 month wait for the casting to come from England ( in the early 90s) and the bare casting with nothing in it cost $600.
January 20th, 2023 at 4:50 pm
9,14 No European brands do well in the U.S., except German ones, and a few exotics. Volvo has been mostly downhill since they quit selling RWD station wagons.
January 20th, 2023 at 5:09 pm
A story in AutoCar (AutoCar.co.uk) about Alpine’s plans, suggested that they were leaning toward using Geely/Lotus platform, since Renault/Nissan’s BEV SUV platform(s) were not robust enough for the vehicles that they planned to bring to market (though the car based EV bones would work just fine). Although Alpine worked closely with Lotus on the A110, the SUVs would be a rebadged Eletra and the Macan size CUV that Lotus has already been working on, should Alpine go that route.
IMHO, I don’t think folks should worry of cheap EVs flooding the market from China. For one, as we Chinese OEM’s in their home market, and in Europe as well, they are selling high quality product for similar prices as the competition! If there is any cause for concern (which I don’t believe there to be) is, as Kevin A mentioned, companies buying the the assets of struggling/floundering startups and doing so for Pennie’s on the dollar. I don’t see that as a bad thing, for it will keep these companies afloat and it will give them a foothold in a big market. Yet, to Sean’s point, the automotive business is not for the faint of heart! While legacy auto makers may make it look and seem easy, the industry itself, along with this new tech and that can be a lot of challenges, both known and unknown, for a new company to have to deal with!
January 20th, 2023 at 8:35 pm
16 Renault should just call their F1 team Renault again, and forget Alpine. Alpine are not going to successfully compete with Porsche, if that’s what they have in mind.
January 21st, 2023 at 7:13 am
@17.) I don’t think Alpine, Lotus, Austin Martin or any of these small, boutique brands want to compete with Porsche directly on ANY level, but if they emulate some of the success they have have in motor sport, vehicle sells, engineering efficiencies, or at the very least get two of those three, they may be good with that! Alpine said they wanted sells of the brand, from all their different models, to reach 150K by the later part of the decade. Porches may or could sell that many Cayenne a year if they wanted! I think it would be a good pairing for Alpine to use the Lotus BEV matrix for their SUV and CUV, for Lotus has indicated that it would be will to share some of those resources with other OEMs, to help cover the cost they have invested in their EV program. They have already collaborated on the A110 platform, so this would seem like a natural fit to a degree. On the other hand, Alpine, in my brief understand and limited history of the brand, is associated with reworked and retrofitted vehicles from Renault. While they will be doing a much more “budget friendly” vehicle for the common person, to see them looking to join forces with Lotus on vehicles that will not be nearly as affordable, that has nothing to do with Renault, Nissan or Mitsubishi, is a little…odd, to me at least!
January 21st, 2023 at 9:00 am
18 Porsche sells a lot fewer Cayennes than I though, only about 20,000 a year in the US. Global Cayenne production is higher than I thought, though, 78,850 in 2021. Unlike most SUVs that big, the US doesn’t dominate the sales.
That’s a lot more than they sell of my Porsche, a 718 Cayman. Cayman plus Boxster sell only ~3500-5000 a year in the US.