AD #3488 – EV Startups at Critical Juncture; Proterra Quits Manufacturing in California; NIO Loses Lawsuit to Audi

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.