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Runtime: 11:10
0:00 2023 U.S. Sales Best Since Pandemic
0:56 BEVs Sell Well in Certain Areas
1:45 Fisker, VinFast Give Up on Direct Sales
2:37 Chip Shortage Turns Into Chip Glut
3:25 U.S. Battery Production Surging
4:47 Ford Lightning Gets Both Price Hikes & Cuts
5:40 Ram Hikes Pickup Prices
6:18 GM Offers Rebate on EVs That Lost Tax Credit
7:04 Chevy Bolts Going for Under $20K
7:52 VW Says Solid State Battery Test Promising
8:43 Oil Prices Down Despite Global Turmoil
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This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
2023 U.S. AUTO SALES BEST SINCE PANDEMIC
Automakers are reporting car sales for 2023 and General Motors is once again the sales leader in the U.S. The automaker sold 2.6 million vehicles last year, up 14% from 2022. Toyota was number two with 2.25 million vehicles sold, which is a 6.6% gain. As of writing this, not all automakers have reported their sales but overall U.S. sales are expected to be around 15.5 million units compared to 13.9 million in 2022. And that’s the highest number since the pandemic. Electrified vehicles, including hybrids and PHEVs accounted for 17% of sales, with BEVs totaling about 8%.
BEVs SELL WELL IN CERTAIN AREAS
And according to a new report from Urban Science, BEV demand is growing in pockets around the U.S. California still leads the way in BEV sales. Last year, three out of the five top market areas for BEV sales by volume were in California. And four of the top five markets by BEV share are also in California. But sales are growing in other areas as well. The BEV share in Seattle-Tacoma was 20.4%, 13.8% in Las Vegas and 12% in Washington DC. And in two counties in Washington the share is 40% and one county in Texas and another in Georgia are at a 15% share.
FISKER, VINFAST GIVE UP ON DIRECT SALES
We’ve heard that EV startups can cut costs by avoiding franchised dealers and selling cars directly to consumers. Well, that was the theory. But Fisker and VinFast are throwing in the towel with their direct sales model and are turning to dealers, instead. Fisker was going to build its own network of showrooms and delivery centers, but it turns out that was more expensive than signing up with existing dealers. It found it didn’t have the money to buy all the land, pay all the sales salaries and have acres of inventory sitting around waiting for customers. It also found that it wasn’t very good at delivering cars to customers. Last year Fisker made 10,000 EVs, but was only able to get 4,700 of them into customers’ hands.
CHIP SHORTAGE TURNS INTO CHIP GLUT
After three years of the auto industry struggling with a chip shortage, guess what’s happening now? There’s too many chips. Mobileye, which makes cameras and chips for ADAS and autonomous vehicles, warned investors that it’s going to get hammered in the first quarter as automakers cut orders to sell off excess inventory. The Wall Street Journal reports that the stock prices of chip manufacturers NXP, Onsemi, Texas Instruments and Wolfspeed are all down on expectations of a chip glut. And so it goes. From famine to feast. The same thing will probably happen with EV batteries. Battery experts predict there will be a glut of EV batteries in the early 2030s.
U.S. BATTERY PRODUCTION SURGING
But it’s still all systems go for U.S. EV battery production. According to a study from the Environmental Defense Fund, the U.S. has already locked in enough battery capacity to outpace the anticipated demand for EVs in 2030, estimating over 1,000 gigawatt hours per year by 2028. It will be needed for an EV scene that’s revving up, hitting 12% of total U.S. vehicle production in 2023, up 70% from the previous year. 45 battery facilities are in the pipeline, boasting an average capacity of 23 gigawatt hours per year. This push has not only accelerated U.S. investments in EV manufacturing and job growth, tallying over $165 billion in the past eight years, but it could also create 179,000 direct jobs, along with 800,000 more in the broader economic landscape.
FORD LIGHTNING GETS BOTH PRICE HIKES & CUTS
Ford continues to mess with the pricing for the F-150 Lightning. The commercial version, called Pro, now starts at just under $57,000, including destination charges, which is $5,000 more than a 2023 model. XLT, which is the base version that a retail customer can buy, is almost $67,000, an increase of $10-grand. The Lariat trim line is also up by $2,000. But there are price drops for the top two trims of $7,000 and $5,000. Platinum trucks now start at $87,000 and Platinum Blacks start at $95,000. However, with price tags over $80,000 both models do not qualify for the federal tax credit, while the other versions do.
RAM HIKES PICKUP PRICES
And before we get into more news about the federal tax credit, I’d like to point out that it’s not just the price of electric trucks going up. ICE truck prices are on the rise too. Ram announced new MSRPs for the 1500 pickup and every trim is up. The increase is as little as $855 for the base Tradesman model but it steadily goes up from there to the Longhorn edition, which is just over $77,500, including destination charges, or more than $14,000 over last year’s price.
GM OFFERS $7,500 REBATE ON EV THAT LOST TAX CREDIT
Now back to those tax credits. New guidelines for battery sourcing requirements kicked in on Monday, which means a number of EVs lost access to the full U.S. tax credit. GM is one of those companies with its Ultium-based EVs, but it doesn’t want the change to dissuade people from buying its electrics. So, it told dealers that it would cover the $7,500 for eligible EVs. But it might not have to do this for too long. GM believes the sourcing requirements will change again, which will make its EVs eligible again sometime early this year. And while many vehicles have lost access to the full credit for purchases, it’s still available for EVs that are leased.
CHEVY BOLTS GOING FOR UNDER $20,000
The one GM vehicle that didn’t lose access to the credit is the Bolt. And it’s quite the bargain. With a starting price just under $27,500, including destination, someone could buy a Bolt for under $20-grand with the full credit. And GM is offering leases on the Bolt that start at $299 a month. But you better act fast. GM ended production of the Bolt in December, so once the existing models are sold, there’s nothing to replace them. A new Ultium-powered version of the Bolt will come back to the market, but it’s not expected to be out until 2025. The plant that made the Bolt is being retooled to make the electric Silverado and Sierra pickups.
VW SAYS SOLID STATE BATTERY VERY PROMISING
Solid state batteries for EVs could be a game changer in terms of range, charging time and cost. And VW says it’s extremely encouraged by the latest test results. It tested solid state batteries from its partner QuantumScape and found that after 1,000 fast-charging cycles the battery only degraded by 5%. That’s the equivalent of driving over 300,000 miles. The auto industry’s target for solid state batteries has been 700 charging cycles with an expected 20% degradation. Of course, it’s one thing to get results like this in a test lab. It’s another thing to make these batteries in high volume production. Even so, the results are very encouraging.
OIL PRICES DOWN DESPITE GLOBAL TURMOIL
Analysts expected oil prices to increase last year because of conflicts in the Middle East and Russia’s invasion of Ukraine. But that didn’t happen. According to the Wall Street Journal, oil and gasoline prices were down 5% and 24%, respectively last month. And that’s largely due to record fossil fuel production in the U.S. Oil exports reached 4.5 million barrels a day in November, which is more than Iraq, OPEC’s second largest producer. And U.S. LNG exports are also expected to hit a record in December.
OEMs POUR BILLIONS INTO SDV
Software defined vehicles, or SDVs, are one of the hottest topics in the industry today. Alix Partners says that OEMs are spending anywhere from 11% to 75% of their R&D budgets on SDVs. And that’s what we’ll be talking about this afternoon on Autoline After Hours. Mark Wakefield from Alix Partners will be on the show, and so will Sam Abuelsamid from Guidehouse Insights. So join John and Gary to learn why automakers and suppliers are pouring so many resources into developing software defined vehicles.
But that’s all for today. Thanks for tuning in.
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Makes you wonder what’s in the water in California. You have a state that can’t keep the power on normally and they lead the country in BEV sales. . leading to even more demand on a grid that can’t handle the load without failing.
Here is an interesting article on the effects of government subsidies on the EV industry in China.
Seems with all the money being thrown at EV’s China had over 500 manufacturers building EVs at one time and many buying the cars themselves or leasing them to ride sharing companies just to collect the subsidies. Most had a range of less than 100km. So now they sit in EV graveyards. as no one wants them. Some only a few years old and probably doing more damage to the environment than had they just made efficient ICEs.
This also makes me wonder how accurate sales numbers are coming from China when companies are making cars and buying them just to collect government subsidies.
https://www.bloomberg.com/features/2023-china-ev-graveyards/
So….the Ram Longhorn is up $14K. I guess that’s so CDJR can offer a $14K “rebate” come summer?
Most of the EVs in California are charged at off-peak times, so the “grid” is not a problem. If 80% of all passenger cars become electric, this would lead to a total increase of 10-15% in electricity consumption.
https://www.virta.global/blog/myth-buster-electric-vehicles-will-overload-the-power-grid
The generating capacity and distribution will have plenty of time to adjust, by the time there are anywhere near than many EVs.
Interesting article about China. I’m not surprised. I remember my dad saying that it was a little that way with Model Ts in the 1930s, but on a much smaller scale, when they were clearly obsolete. They ended up in people’s yards, rather than in large groups like the obsolete EVs in China. They really need to clean them up in China, and recycle battery materials, but that probably won’t happen any time soon. So far, I suspect it is much cheaper to produce new materials than to get them from recycled batteries. That will change, eventually.
We do not have a power issue in CC despite what Texans say. However we have gas prices above $4.
Kit- Few heavy truck charging stations exist, and the power requirements are huge. The new heavy-duty truck charging station in South El Monte, California, can charge up to 32 trucks in about 90 minutes. But six megawatts of electricity will be needed to simultaneously charge these trucks, more than the power consumed by 200,000 homes or used in a small California city, such as San Bernardino or Huntington Beach. off peak or not.
After one trucking company tried to electrify just 30 trucks at a terminal in Joliet, Illinois, local officials shut those plans down, saying they would draw more electricity than is needed to power the entire city.
A California company tried to electrify 12 forklifts. Not trucks, but forklifts. Local power utilities told them that’s not possible. So I dont believe the grid can handle it. Not as fast as they want it to happen.
Your link is an article from Virta. Big surprise they make charging stations. Guess they wouldn’t want people to think they can buy a charger and not be able to use it. Of course they are saying the grid can handle it. you have to consider the source.
Oh and a typical UPS distribution site has on average 140 trucks. I’m guessing the ones in Cali would be on the high side. So you need 4.6 times the size charging station to go fully EV. 28 Megawatts.
@XA351GT the reality on the other hand is that most EVs are charged overnight (because why paying twice as much during the day?) when the power grid has 60% idle capacity. In California most EV charging during the day happens at company parking lots where the power is generated by solar panels.
Please continue to deny the viability of EVs, 2024 Is another great year for it. The rest of the world and the most prosperous/best educated parts of the U.S. are moving on from you.
Battery operated forklifts have been around for decades. Not sure why charging 12 forklifts would be a problem. Many large companies with fleets of forklifts and large warehouses have been replacing their batteries and charging racks with hydrogen fuel cells and onsite hydrogen refueling. This has been the majority of the business Plug Power has been engaged in for at least ten years. Their customers include WalMart, Amazon, and BMW among others.
Recharging is another reason why hydrogen fuel cells make a lot more sense for heavy duty and medium duty trucking than battery power, regardless of what Mr. Musk says. He likes to call them fool cells because he is in the battery business and sees hydrogen as a significant threat to his Semi.
@Kambo it is irrelevant how much a mega charging station would draw compared to a nearby city: what matters is the power generating capacity of the utility company serving the area. Imagine a charging station along a freeway in California on cheap real estate next to a small village. The charging station would draw 10,000 (or fill in any other large number) times more than the village. So what? The power generating capacity and power lines have to be able to handle it: whether it is more consumption than before is irrelevant.
Wim- Its very much relevant if the municipalities are denying the permits needed to build the charging stations based on the power consumption they require. You either have it or you don’t.
They had electric fork lifts 45 years ago where I worked. They were thoroughly modern, with battery swapping. Of course lead-acid batteries. I don’t know the charge rate of the batteries, but I suspect it was fairly slow.
Lambo, are the UPS trucks you mention delivery vans? If so, charging 140 trucks overnight for 10 hours would need a charge rate for all of them of about 3 MW for a full charge if the batteries are 200 kWh. That’s the output of one big wind turbine.
@Kit: Not that it matters, but just fyi, as far as I know currently the world’s largest wind turbine is 16 MW. Those are typically placed off-shore. The average wind turbine is probably in the 3-5 MW range.
Wim, interesting. That 16 MW one must be BIG. My 3 MW number was from a search a while back.
Kit- Not really sure the type of truck, just a quick search revealed UPS has around 7000 trucks and 250 distribution centers. So that’s probably a combination of tractor trailer and the cargo vans.
I’m guessing the company that wants the 30 charging stations (not UPS) could be a 24-hour business and want fast chargers. So maybe that’s where the high draw comes from, they may not have the ability to allow trucks to sit for 10 hours at night to charge. If they have 100 trucks and figure they need to stagger and cycle in charging 24 hours they would be charging all hour’s day and night. A business probably won’t alter its operation to work around charging its fleet.
I found that UPS had ordered 10,000 electric delivery vans a few years ago from Arrival, which has not delivered any vans, and appears to be near bankruptcy. I’m wondering if they are looking for other sources for vans.
I really do not understand the strategy from Ford. The lightning is not selling so the correct course of action is to raise the price? I am sure that will work out well for them.
To both Stellantis and Ford regarding their price hikes, may the odds be ever in your favor.
Maybe Ford just doesn’t want to sell Lightnings, with the huge price increase of the most “mainstream” version.
So it would seem. Maybe they want to sell their ICE trucks instead as the cheapest ICE work truck from Ford in 2024 is $37,000. The cheapest Lightning work truck is $50,000 with the low range battery. To get the lowest spec lightning with a reasonable battery it is coming in at $70,000. That is insane pricing for a XLT model lightning. Of course you could get a low range pathetic battery XLT that will do absolutely nothing other than force you to be at charging stations everywhere you go for $55,000. That is still insane.
The equivalent high range XLT supercrew, there is to high/low range feature on an ICE like there is with the BEV, is $53,000. So $2000 less than the lightning with a low range battery and 18K less than the equivalent lightning. I guess they really do want people to buy their ICE powered trucks.
My guess is Ford is trying to hit while the iron is hot. Realizing the only buyers for the Lightning are people that truly want an EV and have money to spend. The general public isnt interested so take advantage of what people are willing to pay while they can.
Based on pickup truck owners I know, maybe they just don’t want EV pickups. Some people I know with trucks don’t tow, don’t haul anything very heavy, don’t use them for long trips, could easily set up home charging, and have plenty of money. One of these people recently bought a Safari Denali, which wasn’t cheap. He, and others I know could easily afford any vehicle they wanted, but to my knowledge, have no interest in an EV.
When EV trucks get price competitive with gassers, we’ll see how they sell, but as long as gas remains cheap and available everywhere, I suspect the gas trucks will continue to sell, even to people for whom an EV would work well.
Wim Van Acker Reality is here bin PA we don’t have revolving rates . So whenever you charge a car or use electric the rate stays the same .
XA351, it looks like, with home charging, operating cost for an EV would be low, no matter when you charge it.