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Runtime: 7:55
0:07 Tesla Q1 Worse Than Expected
0:32 Tesla Has a Logistics Problem
1:10 Whole EV Segment Dropping
1:44 U.S. Headed For An EV Disaster
2:44 Ghosn Granted Bail… Again
3:32 Toyota Tests Satellite Images for 3D Maps
4:16 Challenger Sales Pull Away From Camaro
5:31 VW EV Racer Sets Sights on Nurburgring
6:21 One Blinged Out Ford Escort
7:12 Just a Cool Historic Picture
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This is Autoline Daily reporting on the global automotive industry.
TESLA LOSSES WORSE THAN EXPECTED
It’s a bad day in Tesla Land. The company reported big losses for the first quarter, far worse than analysts expected. Revenue was down 37%, a drop of nearly $2.7 billion. It posted an operating loss of $521 million and a net loss of $667 million. The company’s cash pile dropped 40%.
| Tesla Earnings | |||
|---|---|---|---|
| Q1 2019 | Q4 2018 | Change | |
| Revenue | $4.5 Billion | $7.2 Billion | -37% |
| Operating Loss | -$521 Million | $413 Million | -$935 Million |
| Net Loss | -$667 Million | $210 Million | -$877 Million |
| Cash | $2.1 Billion | $3.6 Billion | -40% |
TESLA HAS LOGISTICS PROBLEM
The biggest problem Tesla faces right now is that it can’t deliver Model 3’s to customers fast enough. Unlike the Model S and X, Tesla does not build-to-order for Model 3’s. Instead it builds them in batches and puts them in inventory, parking them in lots and yards around the country and around the world. It cannot book those cars as sold until a customer takes delivery. If Tesla can solve its logistics problems, things should brighten up considerably. Even so, Elon Musk warned analysts that the company will lose money next quarter but should be profitable in the third quarter.
WHOLE EV SEGMENT DROPPING
Before other automakers snicker at Tesla’s big losses, they better be worried about the public’s acceptance of battery-powered cars. Tesla is not losing sales because other EVs are stealing sales. The whole segment is dropping. In fact, sales of EVs are falling nearly 3 times faster than the rest of the market. Tesla is actually doing better than the rest of the segment. Take Tesla out of the equation and EV sales fell 24% in Q1 this year versus Q4 last year.
| U.S. EV Sales | ||
|---|---|---|
| Q4 2019 | Q1 2019 | Change |
| 83,911 | 79,226 | -5.6% |
| w/o Tesla | ||
| 13,689 | 10,384 | -24% |
U.S. HEADED FOR AN EV DISASTER
And that’s why we believe the auto industry is headed for an EV disaster. Right now there are 13 BEVs for sale in the U.S. market and they account for less than 2% of all sales. But in only three years time, if you believe what the car companies say they’re going to do, there will be anywhere from 80 to 120 EVs hitting the showrooms. We just don’t see the market demand for these cars, because remember, the traditional automakers are not building these cars because customers are clamoring for them. They’re making them because governments around the world are forcing them to.
And we’ll be back with more right after this.
GHOSN GRANTED BAIL… AGAIN
Good news for Carlos Ghosn, he could be getting out of jail soon. A Japanese court just granted him a $4.5 million bail. Prosecutors have appealed that decision, but if it’s upheld, Ghosn will be free to leave his detention center, only after meeting certain conditions. He can’t meet or speak with his wife without permission, plus his movements and communications will be closely monitored. We think this is pretty outrageous. Japanese authorities confiscated his passport. And he’s the most recognized man in Japan right now. So it’s not like he’s a flight risk who can sneak out of the country. Besides, he already paid $9 million in bail over a month ago, prior to being re-arrested earlier this month.
EASIER WAY TO CREATE 3D MAPS?
Before autonomous vehicles can become a reality, they need to follow 3D maps so they know precisely where they are. GM’s Super Cruise relies on high-resolution 3D maps created from LIDAR by driving on those roads. But Toyota is preparing to test a new approach that could save both time and money. It teamed up with Maxar Technologies and NTT Data to create high-definition maps for self-driving cars using hi-res satellite images. Toyota says HD maps have been created for less than 1% of roads around the world. But if it can do it by satellite, all kinds of roads could be mapped quickly and cheaply.
CHALLENGER SALES PULL AWAY FROM CAMARO
Chevrolet and Ram are in a big argument over who’s pickup outsells the other. But there’s another argument brewing. The Dodge Challenger now outsells the Chevrolet Camaro. The tipping point came last year and not only is the Challenger pulling away, it’s getting awfully close to the Mustang. Remember the Challenger sits on one of the oldest platforms in the business. It’s a reworked version of the Mercedes E-class left over from the days of DaimlerChrysler. FCA was going to put it on an Alfa Romeo platform, but that didn’t work out. So they’re revamping the existing platform and it should be in showrooms within the year.
We’ve got a great Autoline After Hours lined up for you this afternoon, when our special guest will be Robert Bollinger, the CEO and founder of Bollinger Motors. We’ll be talking all about his all-aluminum, all-wheel-drive, all-electric, off-road truck. Join us today at 3PM eastern time on our website, Autoline.tv.
VW EV RACER SETS SIGHTS ON NURBURGRING
Volkswagen’s all-electric ID. R race car smashed the record in the Pikes Peak Hill Climb last year and now has its sights set on the Nurburgring. Testing starts today for the car, which has been in continuous development since that record-setting run and is specially tuned for the 12.9-mile section of the track. For example, the ID. R needed to be set up for maximum downforce on Pikes Peak, but that’s not the case for the Nurburgring. So, it was fitted with a drag reduction system, similar to F1, that reduces the air resistance of the vehicle by about 20 percent at the touch of a button. The ID. R will eventually try to beat the current EV lap record of just under 6-minutes and 46-seconds.
BLINGED OUT FORD ESCORT
One jeweler’s love for the Ford Escort has led to a pretty amazing creation. Russell Lord has spent thousands of hours over the last 25 years creating a 1:25 scale version of the works rally car driven by Ari Vatenen in the late 1970s. Even if it weren’t made from silver, gold and diamonds, the level of detail still sets it apart from other scale models. The pulleys spin on the front of the engine, the diamond-encrusted platinum gear stick even moves and the windows are collected pieces from smashed vases. What’s crazy is Lord says he knows the car so well there were no plans and he just started building it from the ground up. His labor of love will now be auctioned off for charity on May 2nd.
JUST A COOL HISTORIC PICTURE
And speaking of things that are just plain cool, check out this picture of a modified Mercedes 300 SL Gullwing help a racing cyclist in 1962 become the first person to go 200 km/h on a bicycle. And look at how massive the front sprocket is on that bike. Amazing.
But that’s all for today’s show. Thanks for watching and we’ll be back again tomorrow.
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John McElroy is an influential thought leader in the automotive industry. He is a journalist, lecturer, commentator and entrepreneur. He created “Autoline Daily,” the first industry webcast of industry news and analysis.
