AD #4199 – Volkswagen Shares Small, Affordable EV Details; Brazil #1 In Armored Car Sales; China Issues New Rules to End EV Price War

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

JP MORGAN LETS RICH CLIENTS BORROW AGAINST CLASSIC CARS
Whenever you want a loan, the bank always wants something in return. So JP Morgan Chase is going to give its wealthy customers in Europe the option of using their classic car collections as collateral. It already allows clients in the U.S. to do this, and now it’s expanding to six countries in Europe. In turns out, wealthy individuals are increasingly using car collections to diversify their fortunes. Prices for classic cars from Ferrari, Porsche and Mercedes have outperformed the stock market in recent years. And high-end cars are the most popular asset with young rich people, ranking ahead of private jets, superyachts as well as wine and art collections.

BRAZIL #1 IN ARMORED CAR SALES
Brazil has some of the highest violent crime rates in the world, and that propelled it into the top armored car manufacturer in the world. For example, it sells four times as many armored cars as Mexico, which is number two in sales. The business is now worth $660 million a year in Brazil and is projected to grow by a third in the next two years. Customers generally buy a regular vehicle from a dealership, then take it to an armoring company, which costs about $15,000. Armored car production is expected to increase 16% this year in Brazil, to 40,000 units. And there are now nearly 400,000 armored vehicles on Brazilian roads.

  

VOLKSWAGEN SHARES SMALL, AFFORDABLE EV DETAILS
More details are coming in on Volkswagen’s new family of small EVs for Europe that will cost under 25,000 euros. They’re all using the updated MEB+ platform, which is front-wheel drive based and features a newly developed electric motor that is lighter and has fewer components. It comes in four power outputs; ranging from 85 – 166 kW or about 115 to 225 horsepower. The two less powerful motors can be paired with a 37 kWh LFP battery pack, however we haven’t seen any range figures for these setups yet. The two more powerful motors are paired with a 52 kWh NMC battery pack and will provide up to 450 km or nearly 280 miles of range. The new Volkswagen ID. Polo will be available with all of these setups when it launches in April of next year and is expected to have a starting price under 25,000 euros. Cupra’s version, called the Raval, will actually come out a month earlier, but it will only have the more powerful motors, so it will have a starting price of 26,000 euros. The ID. Polo and Raval will be built at one plant in Spain, which could eventually have the capacity to build 600,000 hybrids, ICEs and BEVs a year. While another facility in Spain will build an additional VW model as well as a Skoda EV on the same MEB+ platform. The company hopes to grab 20% of Europe’s small EV segment with this new family of vehicles.

WORKAROUND FOR GM APPLE CARPLAY
General Motors’ decision to remove Apple CarPlay and Android Auto from almost all of its new electric vehicles didn’t sit well with some customers. It’s also planning to remove the feature from its upcoming gas-powered cars too. But if you really want the feature, there’s now a new third-party hack to bring it back. However, the process does seem a bit complicated, especially if you’re not tech savvy. It involves buying a $55 adaptor, and there are some limitations, it only works with Apple CarPlay wirelessly. But if you really want a GM car, and you really want Apple Car Play, there is a work-around.

BYD IMPROVES EV MOTOR EFFICIENCY AT HIGH SPEEDS
BYD is developing interesting technology to make electric motors more efficient at higher vehicle speeds. CarNewsChina reports that it’s filed several patents for what’s called a Variable Flux Permanent Magnet Synchronous Motor. From the way I understand it, there’s adjustable or moveable components inside the housing that regulate the magnetic field of the motor, so it’s more efficient across all operating conditions. Conventional electric motors provide a lot of torque at low speeds, but consume a lot of energy while cruising at higher speeds. That’s what BYD is trying to improve, but no figures on what kind of improvement we could expect were given. However, BYD does have a bit of a leg up on the competition. From what we could find, it only looks like Stellantis and Geely are working on similar technology. 

EV SALES SLOW IN CHINA
Sales of EVs are still growing in China. But that growth has slowed dramatically. They were up only 3% in November.

     

CHINESE EV MAKERS BRING PRICE WAR TO THAILAND
That’s making exports all the more important for Chinese automakers. And to keep sales strong, they’re taking their price war to other markets. In Thailand, SAIC cut the price of its MG4 EV by 27%. BYD cut the price of the Seal EV by 38%. And Chery’s Jaecoo J5 hit the showroom floors with promotional discounts. Bloomberg reports that some dealers are selling EVs at or even below cost. As a result, EV sales in Thailand shot up 20% in the last two months and Chinese automakers are grabbing market share away from the Japanese automakers who have dominated that market for decades.  

CHINA ISSUES NEW RULES TO END EV PRICE WAR
Meanwhile, back in China, the government is deeply worried that the price war will cripple its auto industry. It even gave its worries a name, involution, which refers to a shrinking down. So the government is proposing guidelines to stop automakers from selling cars below the cost of production. And it wants to stop dealerships from offering discounts or rebates. The government promises “significant legal risks” if they don’t comply. Here’s our Autoline Insight. It’s going to be fascinating to see how this plays out. China has massive overcapacity, enough to satisfy the U.S. and European markets put together. That’s the root cause of the price war. Automakers need to slash prices to keep sales going so they don’t have to close their assembly plants. But the result is that fewer than a handful of automakers are profitable. And yet, if prices start to go up, sales will go down, and factories will start to close. And so the government’s moves to try and prevent the auto industry from shrinking is likely to kick off a restructuring that is going to see the elimination of dozens of automakers and tens of millions of units of capacity. 

An early warning here. Autoline is going to shut down for the last two weeks of the year to give the crew here a well-deserved break. We’ll be here for the rest of this week, and be back at it early in the new year, right in time for CES.

And we hope to see you back here tomorrow for another report from Autoline Daily.