Electric Vehicles

[Iron Lung Jimmy]

Originally Posted by Martinjlm

A lot to unpack in today’s Autoline Daily, so I’ll just link to the complete episode. It’s a bit over 9 minutes viewing time for those interested in viewing. The key takeaways, at least EV related, are

• EVs hit 1 million US Sales in a year for the first time in November; still a month to go
• EV sales growth is 4x market sales growth (but didn’t we just see a video posted here saying EV sales are slowing?)
• Interest growing in bi-directional charging
• Global oil demand dropping at a rate equivalent to Canada’s annual oil production. Canada is 4th largest oil producing nation. (US and Russia are #1 and 2)
• Daimler Truck reusing retired E-Bus batteries (as opposed to assumptions that Li-Ion batteries will clog landfills)

EV sales - Sales are going to be 1 million yet over 20% of the car dealerships in the U.S. are writing letters to Biden telling him to stop because inventory is piling up. So maybe that 1 million number is not really that meaningful.

Growth 4x ICE - If I sell 100,000 of something and my sales increase to 150,000 my sales increased 50%. If you sell 10 of something and your sales increase to 30 your sales increased 200%, 4x mine. Big deal.

Global oil demand - Listen to the guy carefully. The predicted reduction of oil demand is for when the EV percentage is 40-45% by the end of the decade, not currently.

Originally Posted by Martinjlm

The main point of the incentives is not to get people to buy EV over ICE. The main point is to say, because it is clear that buyers will continue to buy EV, let’s get them to buy EVs that are made in North America (+jobs) using high tech materials that are soured in North America or friendly countries (not China, Russia, Iran, etc) so that even some of those jobs are staffed here instead of sending the $$ back to China.

In other words, since it’s apparent that our lunch is going to be eaten, let’s at least make certain we’re the ones eating it.

With all due respect, and believe it or not I am basically with you on most of this, please don't insult our intelligence. Of course the main point of the incentives is to get people to buy EV's over ICE. To try to spin it otherwise damages your credibility... but certainly does keep this thread more interesting

[Martinjlm]

Originally Posted by Iron Lung Jimmy

EV sales - Sales are going to be 1 million yet over 20% of the car dealerships in the U.S. are writing letters to Biden telling him to stop because inventory is piling up. So maybe that 1 million number is not really that meaningful.

The reason dealers are writing letters is because of the million EVs sold, only 39% were sold at dealerships. So the better EV sales get, the worse it gets for them. Tesla, by far the biggest EV seller, does not use a dealership model except where law requires them to do so. We got our Tesla from one of I think two dealers in the state of Michigan.

Originally Posted by Iron Lung Jimmy

Growth 4x ICE - If I sell 100,000 of something and my sales increase to 150,000 my sales increased 50%. If you sell 10 of something and your sales increase to 30 your sales increased 200%, 4x mine. Big deal.

Agreed. But if those multiples continue at similar rates for multiple years, then it really is a big deal. I think I posted somewhere earlier that Toyota, Ford, Chevrolet, and Honda are the only brands that currently outsell Tesla in the US. And at the same time, Tesla sales are up over 30% year to year while the brands ahead of them in sales have single digit sales growth.

Originally Posted by Iron Lung Jimmy

Global oil demand - Listen to the guy carefully. The predicted reduction of oil demand is for when the EV percentage is 40-45% by the end of the decade, not currently.

Correct. I worded that very poorly. I did not intend to project that this is already the case, but that it is forecast to be the case.

Originally Posted by Iron Lung Jimmy

With all due respect, and believe it or not I am basically with you on most of this, please don't insult our intelligence. Of course the main point of the incentives is to get people to buy EV's over ICE. To try to spin it otherwise damages your credibility... but certainly does keep this thread more interesting

I have to totally disagree. The purpose of the incentives is to position the US to maintain a high number of industry relevant jobs as the transition from an ICE auto industry to a BEV auto industry takes place. I had the pleasure(?) of being in the industry when the rapid shift to Japanese economy cars shuttered plants and descimated small town America because the US automakers were ill-equipped to fight back. Remember “Roger & Me”? I lived and worked in Flint at the timeframe of that movie, which documented the gutting of the city’s economy due to many rapid fire plant closings. A lot wrong with that movie, but the underlying facts are undeniable. The primary purpose of the IRA is to force build of EVs and batteries in the US in order to hopefully stave off the devastation that would no doubt happen if imported EVs were allowed to flow in unchecked. So by providing incentives for buyers to purchase cars made in North America using batteries built in North America using battery materials processed in North America at least gets out ahead of a repeat of the ‘80s complete upending of the auto industry. If that position insults somebody’s intelligence, then so be it.

[Iron Lung Jimmy]

Originally Posted by Martinjlm

I have to totally disagree. The purpose of the incentives is to position the US to maintain a high number of industry relevant jobs as the transition from an ICE auto industry to a BEV auto industry takes place. I had the pleasure(?) of being in the industry when the rapid shift to Japanese economy cars shuttered plants and descimated small town America because the US automakers were ill-equipped to fight back. Remember “Roger & Me”? I lived and worked in Flint at the timeframe of that movie, which documented the gutting of the city’s economy due to many rapid fire plant closings. A lot wrong with that movie, but the underlying facts are undeniable. The primary purpose of the IRA is to force build of EVs and batteries in the US in order to hopefully stave off the devastation that would no doubt happen if imported EVs were allowed to flow in unchecked. So by providing incentives for buyers to purchase cars made in North America using batteries built in North America using battery materials processed in North America at least gets out ahead of a repeat of the ‘80s complete upending of the auto industry. If that position insults somebody’s intelligence, then so be it.

There are very real differences between now and the 80's.

People in the 80's didn't flock to small Japanese cars because they suddenly thought it would be fun to drive them, or that they were impressively stylish, or for whatever other fashionable reasons people choose a car. They flocked to small Japanese cars because gasoline had gotten very expensive and Japanese cars got much better fuel economy. Not only that, but the Japanese cars cost less. There was a very real financial incentive, both immediate and long term.

Then, having bought them for those reasons, they discovered that the build quality was far, far superior to the crap the Big 3 was selling and the rest is history.

Today's push to EV's is largely government, not consumer driven. And instead of a fuel shortage which was costing real people real money, the reason is nebulous climate change warnings which, if we are being honest, are way down the list of most regular people's concerns. Way down the list.

And the government knows this.

So, in order to get people to buy cars they don't really want in order to solve a problem they don't really care about, it does two things - puts harsh regulations on the type of car they do not want to be sold - and threatens even harsher ones - and financially incentivizes consumers to buy the type of car they, the government, wants them to buy.

In a vacuum you are correct about the intent of the IRA incentives, but there were government incentives going back to practically the first Tesla that rolled off the line. Those incentives were for the sole purpose of making EV's more competitive with ICE so people would buy them and, to my way of thinking, today's incentives are no more than that.

[MyNameIs]

Originally Posted by Iron Lung Jimmy

There are very real differences between now and the 80's.

People in the 80's didn't flock to small Japanese cars because they suddenly thought it would be fun to drive them, or that they were impressively stylish, or for whatever other fashionable reasons people choose a car. They flocked to small Japanese cars because gasoline had gotten very expensive and Japanese cars got much better fuel economy. Not only that, but the Japanese cars cost less. There was a very real financial incentive, both immediate and long term.

Then, having bought them for those reasons, they discovered that the build quality was far, far superior to the crap the Big 3 was selling and the rest is history.

Today's push to EV's is largely government, not consumer driven. And instead of a fuel shortage which was costing real people real money, the reason is nebulous climate change warnings which, if we are being honest, are way down the list of most regular people's concerns. Way down the list.

And the government knows this.

So, in order to get people to buy cars they don't really want in order to solve a problem they don't really care about, it does two things - puts harsh regulations on the type of car they do not want to be sold - and threatens even harsher ones - and financially incentivizes consumers to buy the type of car they, the government, wants them to buy.

In a vacuum you are correct about the intent of the IRA incentives, but there were government incentives going back to practically the first Tesla that rolled off the line. Those incentives were for the sole purpose of making EV's more competitive with ICE so people would buy them and, to my way of thinking, today's incentives are no more than that.

Quality of Japanese cars wasn't all that. They were in fact worse in many cases. Americans bought Japanese cars because of High gas, then they found insurance was much lower, the fake news hyped the japanese car because they were positioned to benefit financially along with politicians. Notice how as soon as japanese cars began being dumped on us shores just as the fake gas crises hit. Perfect and planned timing. Everyone in the know, politicians, media were all position to make money. Notice how everyone loved American cars, then almost over night the media began trashing them. The government began slamming them with mandates forcing them to cut corners to stay in business. Meanwhile quality did go down, then the japanese cars that were trash began improving because the US was buying them, then the japanese quickly reinvested to improve their quality as US makers were still struggling with the mandates, there reputation was being damaged. The small underpowered go kart like japanese car did not have to meet the same EPA as America because they were small 4 bangers that already met the requirements, easily competing against gas guzzling V8s that were just fine a few years earlier when gas was just 32cents a gallon. Lots of people got rich back then from that scam and still are benefiting to this day.

[el ess A]

You can't conflate the reasoning of an incentive. The consumer determines the reason it works or not. It doesn't matter WHY.

An incentive, put simply, is to motivate someone to do something they wouldn't normally do on their own accord (without the incentive). A prize, a reward for doing something. It manipulates the playing field in the direction you want that person to go.

Buy today, get 10% off. Or, $1500 toward the purchase of a new...(fill in the blank).

And although some may disagree, we haven't hit peak oil yet. For the last 13 months, manufacturing slowdown is reducing a lot of that oil demand at the moment, and likely will for the near-term, but if you listen to the experts, 2024 will gradually start the ramp up again on manufacturing and the oil demand will rise again. No matter how many EVs are on the road. Oil isn't just for making gas.

[snizzle]

Originally Posted by Iron Lung Jimmy

Today's push to EV's is largely government, not consumer driven. And instead of a fuel shortage which was costing real people real money, the reason is nebulous climate change warnings which, if we are being honest, are way down the list of most regular people's concerns. Way down the list.

And the government knows this.

So, in order to get people to buy cars they don't really want in order to solve a problem they don't really care about, it does two things - puts harsh regulations on the type of car they do not want to be sold - and threatens even harsher ones - and financially incentivizes consumers to buy the type of car they, the government, wants them to buy.

In a vacuum you are correct about the intent of the IRA incentives, but there were government incentives going back to practically the first Tesla that rolled off the line. Those incentives were for the sole purpose of making EV's more competitive with ICE so people would buy them and, to my way of thinking, today's incentives are no more than that.

All good points. The current revision of the IRA is both, the government picking winners in all aspects discussed.

[Martinjlm]

Originally Posted by Iron Lung Jimmy

There are very real differences between now and the 80's.

People in the 80's didn't flock to small Japanese cars because they suddenly thought it would be fun to drive them, or that they were impressively stylish, or for whatever other fashionable reasons people choose a car. They flocked to small Japanese cars because gasoline had gotten very expensive and Japanese cars got much better fuel economy. Not only that, but the Japanese cars cost less. There was a very real financial incentive, both immediate and long term.

Then, having bought them for those reasons, they discovered that the build quality was far, far superior to the crap the Big 3 was selling and the rest is history.

Today's push to EV's is largely government, not consumer driven. And instead of a fuel shortage which was costing real people real money, the reason is nebulous climate change warnings which, if we are being honest, are way down the list of most regular people's concerns. Way down the list.

And the government knows this.

So, in order to get people to buy cars they don't really want in order to solve a problem they don't really care about, it does two things - puts harsh regulations on the type of car they do not want to be sold - and threatens even harsher ones - and financially incentivizes consumers to buy the type of car they, the government, wants them to buy.

In a vacuum you are correct about the intent of the IRA incentives, but there were government incentives going back to practically the first Tesla that rolled off the line. Those incentives were for the sole purpose of making EV's more competitive with ICE so people would buy them and, to my way of thinking, today's incentives are no more than that.

I agree with most of what you say relative the Japanese invasion of the ‘80s. The causes were different, but fact of the matter is the results and potential results are very very similar. Difference being, the government that is supposed to be looking out for the well-being of our economy and labor base are actually out in front of it this time.

Yes, there were incentives during Tesla’s early run up, but Tesla (and all automakers) had a cap of 200,000 vehicles under that incentive plan before they were no longer eligible for incentive. Tesla and GM blew through that 200k mark quickly. Fast forward to today and Tesla sells that many Model Y in a year. In the interim period, between when they ran out of the first incentive plan and when they became eligible for the IRA incentive plan, they still had triple and double digit growth rates. So the idea of incentives only being in place to get people to buy cars / technology they don’t want is demonstrably false. Tesla was outselling Mercedes Benz and BMW while selling higher priced EVs with zero incentives in place. And gaining on lower priced mainstream brands that they have since surpassed. But nobody wants EVs.

[Martinjlm]

Fun fact if anyone is interested. One of my colleagues will be the featured guest on Autoline After Hours this afternoon at 3:00 Eastern. In case you wanna yell at someone other than me the show can be accessed at Autoline.tv or through their YouTube channel. Show is hosted by John McElroy, the dean of automotive broadcasting. Today’s topic is the uneven growth of the EV market.

Cool drinking game…take a shot every time he says “lumpy”.

[Martinjlm]

I just happen to be looking at some of our data for a discussion I’m involved in tomorrow. One of the topics is Reason for Purchase for EV / Hybrid.

For Tesla buyers, government tax incentives is #5 with only 25% saying it was a consideration (they can list more than one). Top consideration was fuel savings at 67%.

For all other EV and Hybrid buyers government tax incentives is #3 at 10%. Top consideration is fuel savings at 20%.

For EV and Hybrid intenders (don’t have, but likely to buy) government tax incentives is #4 at 17%. Top consideration is fuel savings at 57%.

This is from a survey of 7,500 respondents.

FWIW - Reasons for not purchasing are (in order)

1. Too expensive
2. Lack of charging availability
3. Time required to charge
4. Limited charging range
5. Unfamiliar with technology

[Capricio]

You're focusing soley on the rebate inscentives and leaving out all the regulatory confiscation Tesla got selling "carbon credits" to the big OEMs. Again, government picking the winners through policy. Why is the "fixing inflation through massive spending" (Green New Deal) so focused on rebates (at our expense) rather than tariffs on Chinese rare earth materials (their expense)?

[Martinjlm]

Originally Posted by Capricio

You're focusing soley on the rebate inscentives and leaving out all the regulatory confiscation Tesla got selling "carbon credits" to the big OEMs. Again, government picking the winners through policy. Why is the "fixing inflation through massive spending" (Green New Deal) so focused on rebates (at our expense) rather than tariffs on Chinese rare earth materials (their expense)?

Tesla selling credits has zippo to do with consumers deciding whether or not to buy an EV over an ICE. It does have a lot to do with how Tesla managed to stay alive as a company despite having to sell product below cost for a number of years. Chalk that up to good ol’ American ingenuity.

[genxer]

Martinjlm, how would you improve the survey you read? Is it public, linkable?

The incentive stats look like an f-u to everyone else's taxes, that the EV/hybrid camp was going to buy anyway.

-Were the Volt, other erEVs a separated camp? How aware are others of the tech?
-How did the different camps rank re-sale, insurance cost?
-Were electricity source, manufacturing impact, other social concerns included?
(to show overlaps, ex: CO2 warming narrative with fuel saving)
-Was personal preference/undesirability of the technology a choice?

[Capricio]

Originally Posted by Martinjlm

Tesla selling credits has zippo to do with consumers deciding whether or not to buy an EV over an ICE.

It drove up the cost of trucks and SUVs to pay for the credits... where do you suppose the OEMs got the money to pay for them? It's a pretty short line to ICE consumer.

[Martinjlm]

Originally Posted by genxer

Martinjlm, how would you improve the survey you read? Is it public, linkable?

The incentive stats look like an f-u to everyone else's taxes, that the EV/hybrid camp was going to buy anyway.

-Were the Volt, other erEVs a separated camp? How aware are others of the tech?
-How did the different camps rank re-sale, insurance cost?
-Were electricity source, manufacturing impact, other social concerns included?
(to show overlaps, ex: CO2 warming narrative with fuel saving)
-Was personal preference/undesirability of the technology a choice?

The survey is NOT public but is available to subscribers to S&P Global Mobility data. I can’t answer the question on how I would improve it. The intent of the survey is to gather input from consumers who’ve recently bought EV/hybrid, are considering buying EV/hybrid, or who recently considered EV/hybrid but bought something else instead. The purpose is to understand for those who have bought or are considering EV, why? And for those who’ve considered and passed, why? And it does that well enough to suit my purposes as a consultant.

Resale was a question in the survey and was not a factor in reason for purchase or rejection. Insurance would have had to have been a write-in under “other”. Didn’t come up. Environmental Benefits as a category to include electricity sources, carbon / global warming et al was a factor and was #2 for purchasers and intenders. Technology was pretty much self explanatory in that if you didn’t like the technology you didn’t buy one and were probably not considering one. But for those who considered but didn’t buy a very small number said they didn’t understand or were unfamiliar with the technology.