Auto execs are coming clean: EVs aren't working
S E E D E D C O N T E N T
With signs of growing inventory and slowing sales , auto industry executives admitted this week that their ambitious electric vehicle plans are in jeopardy, at least in the near term.
Several C-Suite leaders at some of the biggest carmakers voiced fresh unease about the electric car market's growth as concerns over the viability of these vehicles put their multi-billion-dollar electrification strategies at risk.
Among those hand-wringing is GM's Mary Barra, historically one of the automotive industry's most bullish CEOs on the future of electric vehicles. GM has been an early-mover in the electric car market, selling the Chevrolet Bolt for seven years and making bold claims about a fully electric future for the company long before its competitors got on board.
But this week on GM's third-quarter earnings call, Barra and GM struck a more sober tone. The company announced with its quarterly results that it's abandoning its targets to build 100,000 EVs in the second half of this year and another 400,000 by the first six months of 2024. GM doesn't know when it will hit those targets.
"As we get further into the transformation to EV, it's a bit bumpy," she said.
While GM's about-face was somewhat of a surprise to investors, the Detroit car company is not alone in this new view of the EV future. Even Tesla's Elon Musk warned on a recent earnings call that economic concerns would lead to waning vehicle demand, even for the long-time EV market leader.
Meanwhile, Mercedes-Benz — which is having to discount its EVs by several thousand dollars just to get them in customers' hands — isn't mincing words about the state of the EV market.
"This is a pretty brutal space," CFO Harald Wilhelm said on an analyst call . "I can hardly imagine the current status quo is fully sustainable for everybody."
EVs are getting harder to sell
But Mercedes isn't the only one; almost all current EV product is going for under sticker price these days, and on top of that, some EVs are seeing manufacturer's incentives of nearly 10% .
That's as inventory builds up at dealerships , much to the chagrin of dealers . While car buyers are in luck if they're looking for a deal on a plug-in vehicle, executives are finding even significant markdowns and discounts aren't enough. These cars are taking dealers longer to sell compared with their gas counterparts as the next wave of buyers focus on cost, infrastructure challenges, and lifestyle barriers to adopting.
Just a few months after dealers started coming forward to warn of slowing EV demand, manufacturers appear to be catching up to that reality. Ford was the first to fold, after dealers started turning away Mach-E allocations . In July, the company extended its self-imposed deadline to hit annual electric vehicle production of 600,000 by a year, and abandoned a 2026 target to build 2 million EVs .
In scrapping plans with GM to co-develop sub-$30,000 EVs, Honda CEO Toshihiro Mibe said the shifting EV environment was difficult to gauge.
"After studying this for a year, we decided that this would be difficult as a business, so at the moment we are ending development of an affordable EV," Mibe said in an interview with Bloomberg this week.
For some, this pullback is no surprise.
"People are finally seeing reality," Toyota Motor Chairman Akio Toyoda said at the Japan Mobility Show, the Wall Street Journal reported. Toyoda has long been skeptical of his peers' pure-electric blueprints.
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And their forecasts are going to get worse.
Do you consider this to be good news?
Where would you get that idea? This is just the tip of the iceberg.
So you think this is bad news? Do you want the e-vehicle market to grow and succeed or do you want it to wither and die?
You simply don't get it....
EV's will never amount to more than 15-20% of the US automobile fleet. Probably even less than that on a global scale. You seem to have some kind of wild dream about EV's replacing gas powered vehicles.
Lots of cars world in the world, mostly running on gas, and we aren't even talking about trucks, heavy equipment, farm equipment, railroad locomotives, airplanes, and ships, which all use fossil fuels with no viable alternative.
Here's About How Many Cars Are in The World in 2023 | The Drive
I think it's good news. EV's were pushed recklessly, with no actual plan for anything resembling sustainability. It seems to me that it was pushed so hard simply for the idea of the thing. In reality, there are lots of problems. Two of the most major ones would be an electrical grid that isn't ready and how much environmental damage it causes.
I'm all for EV's. In fact, I can't wait for the day when almost no one owns a car and we rely on automated vehicles we can just call up. But the way we have gone after EV's as if there mere existence will magically solve all the problems has seemed insane to me from the very beginning.
I think hybrids are the smarter move, right now. I've heard some promising things about ammonia burning engines as well.
I asked a question to solicit 1st's opinion. There is no way you can claim I do not "get it" since I have not stipulated anything.
Hello?
How, exactly do you know this and in what time frame are you talking?
Yeah, Greg, we have more than one hundred years of developing internal combustion equipment so we have a major inventory and substantial infrastructure. The migration to electric vehicles will take time.
Also, how did we get from electric cars to electric vehicles of every type? You are just extrapolating like crazy.
Now, key question. How exactly do you know that EVs will always be limited to 15-20% of the US automobile fleet? Deliver supporting facts.
Seems to me that you think it is good news that the market is self-regulating but that you are in favor of EVs.
If that is your position then we agree.
EV's will never amount to more than 15-20% of the US automobile fleet. Probably even less than that on a global scale. You seem to have some kind of wild dream about EV's replacing gas powered vehicles.
I recently toured all over the UK and it almost everything I saw was hybrid or EV. Other things that surprised me were that there are virtually no ratty old cars, everything on the road looked like it was right off the lot. There were an enormous amount of bikes, e-bikes, scooters, etc.. I saw no semis at all, only the occasional box style delivery trucks that also looked to be brand new. I saw not a single puff of exhaust the whole time. I got back home and it was even more apparent how many hoopties and exhaust billowing semis are on the road here. It can be done.
It's an opinion Tig. Based a lot on what's actually happening world wide right now.
Please show us some facts as to why you think that it will ever be more than that.
I'm terrible about predicting future events. About the only future event I can really predict is Sunday's dinner as I've already bought the fixings for some beef stew...
But in time the EV market may take off. And I am only talking about the individual consumer market here and not other transportation vehicles such as buses, trucks, farm equipment, etc.
Biggest problem right now is the technology just isn't ready yet, the support infrastructure isn't yet there and the prices are just too high. As a single person I really don't need two cars and when an EV just won't work for long distance travel I will keep my gas engine car for now.
But for the future? Eventually technology will mature to a point where it's feasible for the average person to own. But so long as the federal government has to subsidize the market to even get people to look at them? Not gonna be a reliable purchase for most people for now.
You started off telling me that I "don't get it" after I merely asked 1st if he thought this was good news. So you should expect me to consider your post hostile. My reply is based on that consideration.
Then you make a very specific claim that the EV's will never amount to more than 15-20% of the US automobile fleet.
Now you equivocate and tell me that this is just your opinion.
Fine, have your opinion. But if you do not have any supporting facts or logic, what caused you to come to such a specific opinion?
There is a clear worldwide move away from fossil fuel for very good reasons. I see no reason to see this trend reverse so we will see energy in aggregate be based on electricity as we move to the future. Not only does this offer tremendous flexibility in technology, but it can be done in an environmentally responsible manner.
Further, fossil fuels are limited (do you need a link for this?) whereas renewables are essentially unlimited. The world's energy needs continue to increase ( ) so we are necessarily driven to tap energy sources that will not be depleted.
Thus, logically, as the world moves towards electrical energy as the predominant source, we will naturally see a migration of technology (including electric vehicles) and infrastructure toward that end.
Now, will this all happen in 10 years? No, absolutely not. But expand the horizon a few decades and I fully expect to see internal combustion engines being a quaint remnant of the past and have a world whose energy needs are predominantly delivered via electricity produced by myriad methods including solar, hydro, chemical, wind, and nuclear (including fusion).
I am in favor of EV's in principle. Not sure I care much about the market part of it beyond thinking it may indicate the public is becoming aware that it isn't the panacea we're being told it is. Not right now, anyway.
Mostly, I'd just like to see them get the cart behind the horse on this one. We need to do better on a lot of issues before EV's are going to have the impact they want on the environment. They're just looking at the end product, the car, and not realizing what it takes to get it. All they see is, "look, ma! No CO2!"
I seem to recall Biden getting all sorts of criticism for trying to accelerate the infrastructure in support of EVs.
Sure the EV market "should" grow, but not at the unreasonably paced schedule "someone" has decided they want it to be.
To me, IMHO, "someone" decided that the EV market should hit the road RIGHT NOW without fully testing the needs to support that decision. When the VP of Ford complains 'bout his new EV F-150 with its many problems and then takes it back to corporate to figure out how to fix - that's not proper integration.
Cost prohibitions are probably one of the largest concerns. Yeah, we're experiencing the finance world attempting to make it so no one can live from one pay check to another. Example - 3 years ago, bought my wife, daughter and self "new/used cars" and went through a credit union for financing. 1.25% interest rate on each of the three vehicles. Last week, talked with a dealer about the possibility of trading my car in for a new one - sure, he said - it'll finance at 8.5% and that's the best we can do.
On their showroom floor was one - ONLY ONE - new car - an EV SUV. In the show area, there were 8 pickups, 1 sedan and two SUV's, where previously you couldn't walk without running into 50 or more pickups, 25 or more sedans and 25 SUVs. Average price for the new vehicles?? $48,000. Price for the EV SUV? $102,000. Sorry, my budget can't play that game.
My basic comment is that the testing and findings didn't/don't match the production push that we're experiencing - not good manufacturing practices.
I agree, it is possible to encourage the growth, but ultimately it will occur at a market pace. Infrastructure changes take time and money. The volume needs to continue to increase to bring more economies of scale. There is no magic here.
And, of course, innovations take time to perfect. The road is always bumpy so we should not expect perfection.
But, with all that in mind, electric vehicles are a very smart strategy and their widespread usage over time is, I believe, inevitable.
A good point. I think most people have very little idea of where their real voting power lies and, perhaps, the few that do don't use it properly, except for the rich. While the ballot box is important, the real voting power most have access to is their money. What one spends their money on is their most powerful vote and they vote with every dollar they spend. I wish more people understood that.
Quite possibly, but not, I think, inevitably. There are a lot of serious companies out there looking for alternatives to EV's. They wouldn't be doing that if they thought EV's were the golden child of the future they're made out to be. Whether EV's actually make it depends on a better, cheaper and more environmentally sustainable battery, in my opinion.
I agree, and battery technology continues to improve (and decrease in price) at an accelerated pace due to the anticipated demand.
Market forces at work; expected demand drives R&D. Amazing what human beings can produce when profit is to be made.
I think they should be rammed up Biden's ass.
Why are you against electric vehicles?
They're fine if you have a short commute and don't go much of anywhere. But the problem is that they will likely remain too expensive for the average working person and family to afford. The manufacture and disposal of the battery is costly. They seem to be prone to hard to extinguish fires. The lack of charging stations on cross country trips. Lack of reliability in cold weather, etc.
Hybrids might be a better option, but would not be cost effective.
Where do you get this information? Is your time frame one year, five years, 25 years, 100 years? The migration will take time and the market will moderate the pace.
Seems to me that you are focused on the short term with zero consideration for the advancement of technology in the future.
Why are you denying the reality of what's actually happening right now?
Why are you ignoring the negatives of EV's, which are many? Why are you such a fan of them? Do you own one yourself?
Should other alternatives to dangerous batteries be further explored, like hydrogen power?
I like to think of it as the buggy whip syndrome. some of the people most opposed to EV's seem to be of a specific age demographic and their faulty reasoning and logic is hilarious. have they all forgotten that when the automobile was initially made available to american consumers that paved roads were rare and gas stations were few and far between? do they also forget how much the collateral businesses associated with the automobile industry did for the american economy? it's way past time, by decades, that the american drug-like dependence on big oil is mostly eliminated. our enemies are ahead of us in solar and battery technology by over a decade because of fossil fuel industry misinformation and we desperately need to fix that as quickly as possible. should people that aren't necessarily going to be present in the future have the most influential voices in deciding what's best for those that will be living in it?
Where do you see me denying anything? You keeping making shit up. Focus on what I write.
I have told you that this is a long term proposition that will evolve over time. That is why I ask of your time frame. If you are just looking at a short time frame then your opinion will be highly skewed by that. And such a short time frame is entirely unrealistic.
Who said I am ignoring the negatives? Again, focus on what I write.
Looks like you are just doing everything you can to deflect. I am a fan of renewable energy. EVs are one technology that exploits renewable energy and as a bonus cuts down on auto emissions.
Not yet. I plan to buy an EV Mini Cooper once they get the mileage up. You are still deflecting.
Every technology has its drawbacks. Battery technology continues to improve and hydrogen is a fine interim solution to cut down on emissions.
So what is your timeframe?
Is your time frame one year, five years, 25 years, 100 years? The migration will take time and the market will moderate the pace.
Seems to me that you are focused on the short term with zero consideration for the advancement of technology in the future.
You could have said almost all of that about gasoline-powered cars in 1900.
What a cogent and valuable contribution!
Misleading at best. What the manufactures are saying is sales slowed. Some because of infrastructure (political in the southern states) and some on the auto strike. EVs are still working and the technology is still ever evolving. It will happen whether one wants it or not. It just might happen slower than Progressives wanted, but still faster than Conservatives have tried to slow it to.
NASA has even created a battery that will work in airplanes - a lot more developments must happen before it's commercial worthy but it works.
Battery powered small planes are reality right now. But in aircraft of any appreciable size, battery weight becomes prohibitive.
Proponents of EV's talk of "evolving technologies" and "continuing developments" in battery technology.
Where is evidence of that and how much more efficient can batteries be made and weigh less?
So... let's see here. EV sales are down.
Which I'm sure has absolutely nothing to do with interest rates being at a 20 year high and spiking faster than any time since 1980. Nothing at all. Totally unrelated. Completely independent events. The car dealers probably don't even know about interest rates.
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A few weeks ago I had a ride (both city and highway) for the first time in an EV. It was the smoothest and quietest ride in a car I've ever had in my life.