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Mid-Morning Art Thread | Main | Republican Representative Accuses House Intel Committee Head Mike Turner of Recklessly Pushing RUSSIAN Panic Porn Just to Stampede Americans Into Supporting His Corrupt Ukraine Aid Package
February 16, 2024

THE MORNING RANT: Roundup of the Latest EV Follies (02/16/2024)

EV on Fire for Header - Cartoon.JPG

Legacy automakers made a catastrophically bad bet on EVs. They are now suspending some new product launches, slashing production on existing EV products, canceling multi-billion dollar battery projects, pivoting to hybrids, and redeploying employees from underutilized EV factories to plants that produce the vehicles that consumers actually desire, e.g. those with gasoline engines.

“The Six Months That Short-Circuited the Electric-Vehicle Revolution; Automakers went all in on battery power, but buyers have proven more hesitant” [WSJ – 02/14/2024]

Some auto executives acknowledge they got ahead of the market with overzealous demand projections.

“Some auto executives” could have avoided billions of dollars in unnecessary losses if they had talked to me before committing so heavily to the EV fantasy.

[Ford CEO Jim] Farley and other industry CEOs are still confident that EVs will eventually take off, albeit at a slower pace than initially envisioned. But for now, the massive miscalculation has left the industry in a bind, facing a potential glut of EVs and half-empty factories while still having to meet stricter environmental regulations globally. “Ultimately, we will follow the customer,” GM Chief Executive Mary Barra told analysts this month.

It’s good that Mary Barra is now acknowledging that General Motors has no choice but to “follow the customer.” Unfortunately, she had previously promised to take GM all-electric in barely a decade, mistakenly believing that GM has the capability of leading the customer down that path, rather than following the customer. GM does not have that capability.

I’ve previously covered how Ford is having to retrench from its failing EV programs. But as noted in the quote up above from the Wall Street Journal, Ford’s destructively inept CEO, Jim Farley, is still a believer in the EV transition. He is clearly willing to destroy Ford Motor Company in pursuit of the globalist anti-carbon agenda.

So how did Ford’s EV division fare in 2023? “Ford’s electric-vehicle business lost nearly $4.7 billion in 2023 and could lose another $5 billion this year, but CEO Jim Farley argues the automaker is undervalued…”

A ship that is taking on water is rarely “undervalued.” How do you “undervalue” a business that is willing to lose $10 billion in just two years on a product that customers don’t want?

Ford sold 72,608 electric vehicles in the US in 2023. Its $4.7 billion loss on EVs averages out to over $64,000 for every electric Ford sold in the US in 2023. Ford’s Board of Directors will have to address the crisis in their CEO office sooner rather than later.

*****

Even Californians Are Giving up on EVs.

In “EV friendly” California, total electric vehicle sales declined in the third quarter (Q3) of 2023 from the number sold in Q2, and then the bottom fell out in Q4, with EV sales declining another 10%, or about 11,000 cars.

“EV sales start to fall in California; Consecutive quarters of falling EV sales could derail state's zero-emission vehicle transition target” [Automotive News – 01/31/2024]

The pain was spread among all EV manufacturers, with Tesla’s sales decreasing by about 5,000 units, and the other manufacturers combining for a decline of about 6,000 units.

“Tesla California registrations fall for the first time since the pandemic” [Reuters – 01/31/2024]

Registrations of Tesla dropped 10% in the last quarter of 2023, the first fall in more than three years in the state, which is one of the most important markets for the electric carmaker and considered a national trend setter.

Is it possible that Q4 EV sales plummeted in California because total vehicle sales also fell? Nope. Not the case.

This was the fifth consecutive quarterly increase in new car sales in the state. The Q4 2023 pace of new car sales showed a slight acceleration compared with Q3, posting a 6% increase.

Sales of the various forms of hybrid are rising rapidly as even California car buyers are starting to reject EVs.

*****

Speaking of Tesla…

We’ve talked a lot in these EV updates about how part of the appeal of Teslas is the “exclusive” hassle of owning one. Here’s another exclusive hassle, the new Cybertruck is prone to rusting and needs lots of swabbing. Just a few months after the first ones were delivered, customers are already complaining that the “stainless steel” isn’t stainless.


“Cybertruck Owners Say They're Already Rusting; So much for ‘stainless’ steel” [Futurism – 02/13/2024]

It's only been a couple months since Tesla started delivering its long-awaited Cybertruck to customers. And as expected, its unusual stainless steel exoskeleton, which can ward off bullets but not stains, is already turning out to be a headache for owners.

"Just picked up my Cybertruck today," they wrote. "The advisor specifically mentioned the cybertrucks develop orange rust marks in the rain and that required the vehicle to be buffed out."

Tesla super-fans want to believe that the Cybertruck is going to steal a lot of business from traditional full size pickup trucks. It won’t. The Cybertruck will likely be popular with the existing Tesla demographic, serving in the role of an electric El Camino, but heavy-duty pickup truck buyers are not going to buy a vehicle about which one Cybertuck owner wrote, “I think as long as you don't drive it in the rain, or get it wet, it will be fine.”

*****

Consumer Reports’ “Talking Cars” video series reviewed the new Chevrolet Blazer EV (embedded in the linked story below), and the best they could say about the car was that ”the door handles worked,” which was more than they could say about the seat belts and floor mats.

“Consumer Reports absolutely shreds new Chevy Blazer EV In negative review” [Torque News – 01/24/2024]

The problems are not all related to “software.” The testing staff found that the rear seatbelts were unusable, and the crew at Consumer Reports had to repair them before they would work. It took two team members, one of whom is a mechanic, to resolve the issue. There was also a problem with the front floor mats that required repair.

Looking for bright spots to offer some balance to the negative review, the team resorted to saying the brakes felt “normal,” and that the door handles worked.

Chevrolet (General Motors) was extremely proficient at making mass-market gas-powered cars, but their government apparatchik CEO decided the company should abandon their core competency and transition instead into being a manufacturer of an entirely different product. Now the hopelessly distracted company cannot even reliably manufacture vehicles with a functioning floor mat.

*****

Three years ago Volvo announced that it would be fully electric by 2030. Their passion against ICE vehicles was so strong that their press release made it clear that they wouldn’t even produce hybrids, which still use gasoline.

“Volvo Cars to be fully electric by 2030” [Volvo press release - 3/02/2021]

Volvo Cars is committed to becoming a leader in the fast-growing premium electric car market and plans to become a fully electric car company by 2030. By then, the company intends to only sell fully electric cars and phase out any car in its global portfolio with an internal combustion engine, including hybrids.

Volvo also entered into a joint venture a few years ago with its parent company, Geely Auto of China, to manufacture EVs under the name Polestar.

Unsurprisingly, it’s all falling apart now.

“Volvo, An Early Electric Car Adopter, Cuts Off Funding for Its EV Affiliate” [WSJ – 02/01/2024]

Volvo Car said it won’t provide further funding to Polestar, the electric-car maker it created with Volvo’s Chinese owner Geely — the latest EV retrenchment by the global auto industry.

*****

Speaking of Polestar…

Many of us had a good laugh at Hertz’s $245 million dollar hit when it finally decided to stop the bleeding on its Tesla debacle. Hertz dumped 20,000 of its Teslas and changed direction on its previous promise to purchase 100,000 Teslas.

But Hertz had also promised to buy 65,000 Polestar EVs, some of which had already worked their way into Hertz’s fleet. Hertz will not be fulfilling that promise.

“Hertz will stop buying EVs from Polestar, too” [The Verge – 02/05/2024]

[Polestar CEO Thomas] Ingenlath told Financial Times that Polestar agreed to waive the requirement to buy all 65,000 vehicles as long as Hertz agreed not to sell off its current stock of EVs too quickly or cheaply.

In other words, there is such a lack of demand for used EVs that Polestar fears the impact of collapsing prices if more than a few of its unwanted vehicles hit the market at the same time.

*****

With Hertz being mismanaged by a CEO who does not understand either his product or his customers, you will not be surprised to learn that Hertz stock has fallen by more than 60% in the past year, from $20 to less than $8 per share.

So who is the CEO of Hertz?

Stephen Scherr is Chair and Chief Executive Officer of Hertz. He is focused on transforming the iconic American company into a global leader in shared mobility, electrification, and digital-first customer experience. Prior to joining Hertz in February 2022, Stephen spent nearly three decades at Goldman Sachs.

With Scherr’s resume, his global-communist agenda, and degrees from Princeton and Harvard, poor Hertz doesn’t stand a chance with him at the helm.

And, of course, as Hertz hemorrhages money and its stock price collapses, Mr. Scherr is looting the company. “Hertz CEO Stephen Scherr’s total compensation of $182 million made him the third highest–paid chief executive in the U.S., according to executive-pay-data and analytics company C-Suite Comp used in a report from the Wall Street Journal.

*****

A reader from Minnesota wrote me the following recently:

“My wife and I are friends with a very wealthy couple who recently replaced both of their high-end luxury cars, which were only used for city driving, with two Teslas. During the recent deep freeze their home chargers were taking so much power from their house that the breaker would trip if they tried to open their garage door. So, despite all the tech in a Tesla (and it is pretty awesome - I took a ride in someone else’s Tesla recently) they couldn’t even get out of their own garage without raising the door manually!

Mind you, our friends have their Teslas parked in their garage and plugged in ALL THE TIME, yet they were still not getting a full charge during the deep freeze. They also don’t drive their Teslas long-distance. I’d be surprised if they ever used 50% of their charge on a daily basis. The farthest they might go in one direction, pretty much, is to the airport and back. They use their Teslas as a wealthy couple could and should: for local errands and shopping, visiting friends, going to the club, and to the local office for work. Everything within a “close circle.”

After being quite pleased with their Teslas this summer — they were raving about them then — they are now very concerned about owning these cars. And if you know any very wealthy people, many of that class do not like any inconvenience … at all.

I’m sure the bread winner of this couple has already looked into the resale value of their Teslas. And I'm guessing he’s not happy. I expect a Mercedes and a BMW to be in their garage instead of those Teslas in 2024. I will definitely let you know if that happens.

I’m calling this couple the “Bellwethers.” I’ve asked my correspondent to keep me informed if/when the Bellwethers sell one (or both) of the Teslas, and what they replace it/them with.

*****

Electric vehicles are significantly heavier than their gasoline-powered equivalents, up to 50% heavier in some cases. Aside from damaging roads and putting parking garages at risk, the force of a moving EV is also more than many guardrails can withstand.

“Crash tests indicate nation’s guardrail system can’t handle heavy electric vehicles” [AP – 01/31/2024]

Last fall, engineers at Nebraska’s Midwest Roadside Safety Facility watched as an electric-powered pickup truck hurtled toward a guardrail installed on the facility’s testing ground on the edge of the local municipal airport. The nearly 4-ton (3.6 metric ton) 2022 Rivian R1T tore through the metal guardrail and hardly slowed until hitting a concrete barrier yards away on the other side.

Barriers along the medians of divided highways serve to keep out of control vehicles from crossing over into oncoming traffic, thus preventing high-speed, head-on collisions. That simple safety mechanism has saved a tremendous number of lives. Thanks to the “EV transition,” we’ll just have to get used to mangled cars and mangled bodies due to head-on highway collisions again.

*****

There is plenty more bad news out there for those still clinging to the fantasy about an all-EV future, but this is enough for today.

Have a great weekend.

[buck.throckmorton at protonmail dot com]

digg this
posted by Buck Throckmorton at 11:00 AM

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