AD #3589 – Car Repair Prices Probably Going Up; EV Registrations Up; VW to Axe Models, Share More Platforms

  

This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.

U.S. EV REGISTRATIONS UP 72%
Tesla’s sales shot up 52% in the U.S. market in the first four months of the year. That’s based on registration data from Experian that was reported by Automotive News. The Model Y was up 99%, the Model 3 was up 28%, the X was up 15%, while the Model S dropped 67%. One reason for the big jump is that certain Tesla models now qualify for the full $7,500 tax credit. Experian’s data show that registrations of EVs from all automakers in the U.S. grew 72% for a total of 348,258 units, accounting for 7% of all vehicles sold, and up from 4.4% for the same period a year ago.

U.S. INTEREST IN EVS GREW SLIGHTLY
Along those lines, J.D. Power released its latest consumer survey that measures how likely they are to buy an EV. It found that about 26% said they are very likely to get an EV which is slightly higher than a year ago. About 35% said they are somewhat likely to get one. On the other side, 20% said they were very unlikely to get an EV and 19% said they were somewhat unlikely. By the way we’re going to dig a lot deeper into that survey on Autoline After Hours this afternoon. We’ve got Brent Gruber, JD Power’s Executive Director, Global Automotive, coming on the show, as well as Tom Moloughney, who’s an expert on EV charging. Some of the topics for the show include GM and Ford going with Tesla’s charging system, as well as Toyota’s pivot into EVs. That show goes live at 3 pm eastern time.

CONTINENTAL DEVELOPS MORE SUSTAINABLE TIRES
With nearly every OEM making commitments to carbon neutrality, we’re seeing a greater focus on reducing emissions. That includes pretty much all things EV and we’ve heard a lot about cleaning up manufacturing plants. Now they’re going after another big polluter, tires. All the little flecks of rubber that scrub off our car’s shoes everyday leach toxins into the ground and water. So, tire makers like Continental have developed rubber compounds that feature more sustainable materials. In fact, Continental claims it’s the first to launch a tire with a large amount of renewables. Its new UltraContact NXT tire, which has up to 65% sustainable material, goes on sale in Europe next month. Some of that material includes rubber ground up from used tires and polyester fibers made from old plastic bottles that it uses to help reinforce the tire.

GRAPHENE LEADS TO TIRE BREAKTHROUGH
But manufacturers are going to have to do more. All tires are still made with a chemical, called 6PPD, which is used to reduce cracking in tire rubber, but it’s also the most harmful to the environment. Reuters reports the state of California is expected to tell tire makers later this year that they have to show they’re looking into alternative materials. And a U.S. startup, called Carbon Rivers may have the answer. Graphene nanoflakes. Graphene is a carbon material that’s strong, flexible and thermally conductive, but is also inert and won’t react negatively with the environment. Early tests show graphene could replace most or all 6PPD and Carbon Rivers says it can be added to tires at a very low price. Testing with regulators could start as soon as Q1 of next year, and while it’s not doing commercial testing with tire makers yet, the startup says tires with graphene nanoflakes could be on the road as soon as 2025.

USED CAR PRICES FALLING
Used car prices in the U.S. soared to all-time highs when inventory got tight over the last three years, but they’re expected to come down in the coming months. According to data from Manheim and Black Book, used car prices at auctions dropped over the last two months and that trend is expected to continue. Used car prices are a big factor in how inflation is calculated by the Bureau of Labor Statistics. So as used car prices come down, so will the rate of inflation, which dropped to a 4% annual rate last month.

TOYOTA KEEPS AKIO, BUT SUPPORT DECLINING
As we reported earlier this week, pension funds in the U.S. and EU wanted to oust Akio Toyoda as chairman of Toyota because they’re unhappy with the company’s EV strategy. And that snowball we were talking about is definitely a little puddle now. At the vote the other day, shareholders did overwhelmingly vote to keep him but his support is declining. Last year, he received 96% of the vote but this year it dropped to 85%. The automaker revealed a bunch of information about its EV efforts before the vote, seemingly to convince skeptic shareholders it’s serious about embracing EVs. But obviously that didn’t sway everyone’s opinion.

VW TO AXE MODELS, SHARE MORE PLATFORMS
As we reported yesterday, the Volkswagen brand wants to boost its earnings by €10 billion by 2026 in order to achieve a return on sales of 6.5%. It also needs to invest in future technologies. To hit those marks, it will focus on high volume models and get rid of slow selling ones like the Arteon. It will also cut model variants and reduce the number of option packages, which will reduce build complexity. And it’s already started on the efforts. For example, the new ID.7 electric sedan has 99% fewer configuration options than the Golf. The VW Group also wants its different brands to share more assembly plants and boost the number of shared platforms.

       

FORD REVAMPS GAS & DIESEL V8s
Electric vehicles perform really well in a lot of driving situations. But they’re not well suited for hauling heavy loads or towing heavy trailers over long distances. That’s why automakers keep investing in their piston engines for heavy duty pickup trucks and full size SUVs. Yesterday Ford showed off its new 6.8 liter gasoline V8 which replaces a 6.2 liter. The new engine develops 405 horsepower and 445 pound feet of torque. It’s actually a destroked version of the 7.3 liter V8 but gets new pistons, rings, and water manifold. Ford also updated its 6.7 liter diesel with a bigger fuel pump with higher pressure, and increased the fuel rate through the injectors by 6%. It dropped the compression ratio slightly to allow for more turbo boost, and added liquid cooling for the turbo compressor housing. Interestingly, the lower part of the exhaust manifold is cast into the head, while the upper part is cast into the valve cover. There are two versions of the diesel. The base one develops 475 horsepower and 1,050 pound feet of torque, while a high output version cranks out 500 horsepower and 1,200 pound feet. The F-450 Super Duty pickup with the diesel and Ford’s 10R 140 transmission is now rated at 8,000 pounds for payload capacity or can tow a 40,000 pound trailer. (Updated 6.7L Diesel Pictured)

CAR REPAIR PRICES PROBABLY GOING UP
I don’t know how I missed this, and truthfully I’m kicking myself for not catching it sooner, but on Tuesday NHTSA sent a letter to automakers telling them not to comply with a Massachusetts law that allows open remote access to a vehicle’s diagnostic system. NHTSA claims some shady individual could use this access to remotely control a vehicle, crash it or make it drive dangerously or attack a fleet of vehicles at the same time. So, why was the Massachusetts law overwhelmingly approved by voters? Some automakers started adding what are called security gateways to their diagnostic systems. In order to get past security you need approval. Some automakers fought to make it hard to get that approval, so the Massachusetts law was amended in 2020 to include the part about open remote access. This made it so 3rd parties, mainly independent repair shops, could get access to vehicle diagnostics and fix people’s cars. I have a great fear that automakers will use this NHTSA letter as an excuse to block independent repair shops from getting access to vehicle diagnostics. It’s going to give their dealers a lot more service work. That will be great for dealers, but it’s going to piss off customers. Repair times are going to go up and so are prices. However, there is hope. Automakers don’t have to block access to their vehicles. Even with the systems right now that use security gateways, automakers have the ability to pick and choose who gets in and who doesn’t, so you could know that you’re getting the most trustworthy people. This creates more work for the independent shops, but at least it doesn’t mean the end of them altogether. If you feel like I’m a little more passionate about this subject than others, you’re damn right. I was an automotive tech for over 13 years and I still know a number of these folks, who are mostly good people.

But that brings us to the end of today’s show. Thanks for tuning in.