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0:00 EU Overcapacity Poses Plant Closing Threat
1:12 Tesla Makes More $$$ Per Vehicle Than GM, Ford
2:49 France Chops EV Subsidies on Too Much Demand
3:34 Rivian Cuts MSRP As Price War Rages
4:50 7 OEMs To Build Charging Network to Challenge Tesla
5:40 Tesla Made $9 Billion In EV Subsidies
6:15 Aston Adds 152 HP To Vantage
7:06 BYD Supercar Boasts 1,200 HP
8:00 Joby To Start Operating eVTOLs In Dubai
This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
EU OVERCAPACITY POSES PLANT CLOSING THREAT
Global car sales have still not recovered to where they were before the pandemic. Automakers sold 8 million more vehicles in 2019 than they did in 2023. And that means a lot of manufacturing sites are sitting around doing nothing. Reuters reports that automakers in Europe are running at only 60% of capacity, which is well below the 80% that most automakers need to break even. BMW is doing the best with 75% capacity utilization, with Mercedes at 73% and the Volkswagen Group at 71%. Stellantis is at 56%, Renault at 54% and Ford at only 39%. The problem is that Europeans are buying 5 million fewer new vehicles than they did just four years ago. And unless sales start picking up soon, we’re going to see those automakers under enormous financial pressure to start closing plants.
TESLA MAKES MORE $$$ PER VEHICLE THAN GM, FORD
Maybe you already saw this story from Reuters pointing out that Tesla doesn’t make as much revenue per employee as General Motors and Ford. It showed that Tesla generates $680,000 in revenue per each employee, while GM generates over a million dollars and Ford gets $937,000. But what this fails to take into account is the difference in vertical integration at each company. GM and Ford buy 80% of the value of every vehicle they make from suppliers. So, much of their “headcount” is actually in the supplier industry. Tesla is almost exactly the opposite, it makes most of its parts in-house. So, here’s a metric that we think is much more important to look at. Last year Tesla made $4,900 in operating profit for every vehicle it sold while GM made $1,600 and Ford made $1,200. So, Tesla makes far more profit per vehicle than GM or Ford. Here’s a bit of history to put this in perspective. Some years back, when Chrysler added a third shift to make Grand Cherokees at its assembly plant in Detroit, it made the plant’s efficiency look worse because it added so many workers. But the extra revenue and profits those third-shift vehicles added, swamped all the efficiency numbers. So the moral of the story is, keep your eye on the bottom line, because that’s where the most important numbers are.
FRANCE CHOPS EV SUBSIDIES ON TOO MUCH DEMAND
France is halting a subsidy to make EVs more affordable for people with low incomes because there was too much demand for it. In the program, anyone earning under 15,400 euros a year was able to lease an EV for 100-150 euros a month. France set aside 1.5 billion euros to cover 20,000 leases but then boosted it to 50,000 leases because of huge demand. However, that still wasn’t enough because it’s halting the program for the rest of the year and will resume it again next year. For those in higher income brackets, France is also offering incentives of 5,000 to 7,000 euros for purchasing a new EV.
RIVIAN CUTS MSRP AS PRICE WAR RAGES
To help boost sales, Rivian is cutting the base price of its R1T pickup and R1S SUV by $3,100. The R1T now starts at $71,700 including shipping while the R1S starts at $76,700. Both models have a range of 270 miles and they also qualify for a $3,750 federal tax credit. Rivian added a new battery option as well with 315 miles of range, and they start at the previous starting prices. Rivian will start delivering those models in March. According to data from S&P Global, R1T sales fell nearly 10% from January to November last year because consumers started buying the R1S instead once its supply improved, which helped boost sales of the SUV.
7 OEMS TO BUILD CHARGING NETWORK TO CHALLENGE TESLA
Seven automakers that sell EVs in North America are banding together in hopes of building a charging network that would rival Tesla’s Supercharger stations. Last July BMW, General Motors, Honda, Hyundai, Kia, Mercedes-Benz, and Stellantis formed IONNA, which aims to deploy at least 30,000 high-powered chargers. Well, it just got approval from authorities and is now officially kicking off operations with plans of building its first stations before the end of the year. First in the U.S., then in Canada. The stations will be able to accommodate EVs with either the NACS or CCS charging port and will have bathrooms, food and shopping there or nearby as well as canopies over charger wherever possible.
TESLA MADE $9 BILLION IN EV SUBSIDIES
Tesla continues to cash in on other automakers needing to meet emission standards. Last year, the company earned nearly $1.8 billion selling EV credits to other automakers who exceed emission limits. Tesla has now made almost $9 billion since it started selling credits to other OEMs in 2009. Some people like to criticize Tesla for selling the credits, saying they wouldn’t be profitable without them. But that’s not the case anymore, Tesla would still be profitable even if it didn’t sell them.
ASTON ADDS 152 HP TO VANTAGE
The Aston Martin Vantage is getting the biggest-ever power bump in the company’s history. The car’s 4.0L twin-turbo V8 now makes 655 horsepower, which is a massive jump of 152 horsepower compared to the previous model. All that power comes from new camshafts, bigger turbos, better cooling and optimized compression. Mated to an 8-speed automatic trans from ZF, the new Vantage will do 0-60 MPH in 3.4 seconds. The chassis also required some reworking to handle all that power, including additional bracing, Bilstein shocks and an electronic rear differential. Throw in a refreshed interior and you’ve seen most of the highlights of the new Vantage, which will be out in the second quarter of this year.
BYD SUPERCAR BOASTS 1,200 HP
But it ain’t got nothing on the first EV supercar from BYD’s ultra-luxury division YangWang. The U9 features four electric motors that combine for a little under 1,300 horsepower and launch this electric rocketship from 0-100 km/h in under 2.0 seconds. It’s also supposed to be available with an active suspension system, called DiSus-X, that could make the ride pillowy-soft or sports car stiff as well as allow it to drive on 3 wheels and even hop. And YangWang just revealed that the U9 will officially launch on February 25th. No word on pricing yet, but the brand’s G-Wagon competitor, the U8 SUV starts at about $150,000.
JOBY TO START OPERATING EVTOLs IN DUBAI
eVTOLs are headed to Dubai. Joby Aviation signed a deal with the region’s Road and Transport authority to launch an air taxi service by early 2026, with initial operations starting as early as next year. Joby’s all-electric eVTOL can carry 4 passengers and a pilot at up to 200 MPH for up to 100 miles or 62 kilometers. At first it will operate between the Dubai International Airport and Palm Jumeirah island, which is normally a 45-minute trip by car but will only take 10 by flying. The deal gives Joby the exclusive right to operate air taxis in Dubai for six years.
And that brings us to the end of today’s show. Thanks for tuning in.
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