Test projects may be tipping point for mobility, Uber and colleagues battling California labor law

Here’s the final commentary in a series on predictions that 2030 will be the watershed year to watch for when vehicles, transportation, and the entire auto industry itself will look quite different than it does today.

Most Americans are skeptical about completely turning over their car rides to an automated, electric vehicle. It would eventually mean giving up an old, classic tradition — getting behind the wheel and taking off for whatever destination they choose, exercising personal freedom of choice. And there are those who adore classic and vintage cars, and won’t ever want to give it up.

The latest J.D. Power study on autonomous vehicles and electric vehicles, and an interview with a top automaker CEO, indicate that peoples’ expectations for new technology development will remain in place; but opinions are leaning toward the transformation and adoption taking much longer than 2030 (more on Honda and the Power study later). Earning the public’s buy-in is going to take a while.

Autonomous, electrified shared rides and robo-taxis appear to be the most likely way that cultural transformation will be taking place — in the US and other markets where ownership of personal vehicles became the expected norm years ago.

There are other pathways expected to play a vital role in these historic shifts. Automated shuttles are becoming the first application for autonomous vehicles to be deployed as people movers under restricted conditions. Fleet deployment of electric light-to-heavy duty vehicles equipped with the latest connected, automated technologies will also play a vital role.

For now, test projects are being carried out integrating autonomous, sometimes electric, vehicles with increasingly popular transportation modes — ride hailing, car sharing, bus and shuttle rides, and a variation on age-old taxi rides. So let’s take a look.

Waymo is the closest example of what it might look like next, certainly in the US and likely around the world. The Waymo One app used to hail rides in Phoenix’s suburb of Chandler provides an alternative to taking a bus ride, taxi, or ride hailing. Started in December 2018, Waymo One has given members of its early rider program (that will go out to the general public eventually) access to an autonomous ride-hailing service. Just hit the button on the app, and very soon an empty Chrysler Pacifica minivan will approach and come to a stop right in front of you.

In 2017, Waymo CEO John Krafcik declared during a conference that “fully self-driving cars are here.” But it would take longer for them to show up for riders. Most all of the Pacifica minivans in the Phoenix area still have human riders trained to take over the van in the event of an emergency; a few self-driving vehicles are operating in limited test areas. There are hundreds of customers in the early-rider program, with some limitations.

Riders will get access to Waymo One if there’s an available vehicle nearby. It’s taking place in a controlled, geo-fenced environment. Riders are selected based on what zip code they live in and have to sign NDAs. The rides are free for now.

Waymo just expanded its working relationship with leading dealer network AutoNation. The autonomous Chrysler Pacifica can now be used to move auto parts between AutoNation’s Tempe, Ariz., locations and other repair shops in the area, including those operated by independent third parties. It’s bound to make the consumer’s vehicle maintenance and repair experience more time efficient and reliable. Previously, the relationship led to Waymo’s Pacificas being serviced at AutoNation garages, and as a mobility source for AutoNation customers to get rides to their dealerships.

Lyft Level 5:  On March 28, Lyft began testing on public roads. Lyft has hired over 300 engineers, applied researchers, product managers, operations managers, and more. The focus has been on creating the world’s best computer vision, robotics, and machine learning experts. Cited accomplishments include 3D segmentation frameworks, new methods of evaluating energy efficiency in vehicles, and tracking vehicle movement using crowd-sourced maps.

The investment from General Motors has merely provided Lyft with needed capital. The company’s autonomous ride group, called Lyft Level 5, about a year ago launched a public self-driving program in Las Vegas with partner Aptiv. In August 2018, the project surpassed 5,000 self-driving rides. That recently surpassed over 50,000 autonomous rides to Lyft passengers. The company said it makes it the largest self-driving program in the US.

Waymo is another partner, where some its self-driving minivans are available for Lyft ride sharing. It’s restricted to Waymo’s authorized zone outside of Phoenix. Waymo CEO Krafcik believes the relationship gives both companies “the opportunity to collect valuable feedback.”

Last spring, Lyft said in its mandatory IPO filing that it wants to begin providing self-driving ride-hail trips on the app within five years. Within a decade, Lyft wants to be ready to provide a network of autonomous vehicles providing a majority of its trips. Five years later, the company wants to see its “purpose-built” self-driving vehicles on the road — able to take passengers on long-haul journeys.

Advanced Technologies Group (Uber ATG):  Before being forced out, Uber founder and former chief executive, Travis Kalanick, said in 2016 that self-driving technology was “basically existential” for the company.

The company believes the future of mobility is increasingly shared, sustainable, and automated. The payoff will be big — supporting sustainability, helping make roads safer, and making transportation more affordable for everyone. But the capital drain continues.

Questions have come and gone about whether Uber will be able to stay in the autonomous vehicle race, with things ending badly in its Pittsburgh test market years ago. Last year’s pedestrian fatality also raises the challenges of clearing the investigation and restoring trust in its ability to safety test its AVs.

Uber is still testing adapted Volvo vehicles in its partnership with Volvo Cars through its, a company that does emphasize safety. A test project with Toyota also continues. Another alliance exists with PTIO, the Partnership for Transportation Innovation and Opportunity, to find solutions that ensure everyone benefits from the adoption of self-driving technology.

AV testing through Advanced Technologies Group (Uber ATG) continues in Dallas, Pittsburgh, San Francisco, and Toronto, with about 32 AVs being monitored and tracked. Dallas has been the center of testing, with ancillary test runs and Uber services being tried out, including shared rides, Uber Eats, JUMP scooters, Transit, Uber Freight, and more. The city’s modern infrastructure, unique traffic patterns, road characteristics, and climate offer new information that inform the company’s ongoing engineering efforts.

Tesla continues to cooperate with officials during investigations over fatalities tied to its Autopilot semi-autonomous feature. But the race is far from over. The company does have a sizable early lead in this space both in terms of autonomous miles driven as well as monetization of its self-driving technology.

The electric automaker has already delivered over 780,000 vehicles since its launch, and most of them come with pre-installed self-driving capabilities that users can unlock by paying for software. The company’s autonomous driving hardware is based on mature technology such as Radar, Ultrasonic, and Passive video, which is cheaper than some rivals who use LIDAR – a laser-based system.

Going this route has enabled the company to equip the hardware as standard in all its vehicles, irrespective of whether or not a user enables it by paying money.
As the company’s vehicles are estimated to have driven over 1.88 billion Autopilot miles in total thus far, this could be further enhancing Tesla’s log of driving data.

CEO Elon Musk has suggested that its AV system will be available in various applications, including as a revenue source for owners. Those opting in can rent their Model 3, or other Tesla vehicle, out to Uber and Lyft drivers (or another ride-hailing firm) needing an autonomous EV to do their work.

Maven and GM:  In May, GM began shuttering its Maven car-sharing business in eight major U.S. cities, including Boston, Chicago and New York. GM won’t ending Maven anytime soon, but it is taking much longer than hoped to expand. It started up in early 2016 when a team of engineers and project managers were brought over from Google and Zipcar, along with staff it acquired from Sidecar, a failed competitor to Uber and Lyft.

Business has been smaller and slower than anticipated, and with competition coming from established car-sharing brands Zipcar and Car2Go. Two other segments were added — Maven Gig, a rental service for carless Uber and Lyft drivers. Maven Reserve added longer-term rentals; and the latest sub-segment is a peer-to-peer rental service. Maven had also been a good channel for testing out EVs and AVs. In 2017, Maven added over 100 Chevy Bolts to its fleet and participated in GM self-driving car testing.

CEO Mary Barra in recent years had emphasized that her company will become the global leader in advanced, autonomous, and electric vehicles as automakers shift over from vehicle manufacturers to full-service mobility service providers. Maven has been a slow-development projects and AVs are going that route. In July, Its self driving car unit, GM Cruise, said in July it was backing off plans to make available autonomous taxis by the end of this year. More testing of the vehicles will need to happen first.

GM’s $500 million investment in ride-hailing firm Lyft in 2016 has moved far away from any type of joint project, with Lyft continuing to test its own small fleet of self-driving cars without GM’s involvement.

Apple-backed DiDi Chuxing has received a license to operate a fleet of up to 50 self-driving cars on a pilot basis in part of the Jiading district in Shanghai, China. Automakers SAIC and BMW also received permits at the World Autonomous Vehicle Ecosystem Conference on September 16.

Apple had invested about $1 billion in DiDi in 2016. The tech giant has expected that its investment and involvement would boost both companies’ efforts in product research and development — especially in China’s massive auto market. In January, the company cut more than 200 employees from its self-driving car initiative, Project Titan, in what it described as a restructuring. Five months later, Apple confirmed that it had acquired Drive.ai, a self-driving startup backed by more than $77 million in funding.

Didi, a giant ride-hailing company in China, was scheduled to begin picking up ride-hailing passengers with self-driving cars in Shanghai soon. The project will be expanded the program from that city — going toward the deployment of self-driving vehicles outside of China by 2021.

Test rides include another rider providing safety intervention in the event of an emergency. Didi is waiting for a few remaining licenses before it can start transporting customers in AVs. Self-driving rides will be free for customers, and more than 30 different vehicles will be offered for self-driving trips as part of the pilot, the company said.

Amazon:  Amazon continues its move as the central player in goods delivery, warehousing, and integrating technology advancements like delivery drones into the equation. One of the decisions was for Amazon to set up acquisition of 100,000 all-electric delivery vans to Amazon over the next decade. Michigan-based startup Rivian Automotive will be building and delivering them. Amazon chief Jeff Bezos said 100,000-unit fleet will eliminate 4 million metric tons of carbon emissions when fully operational.

Over the last decade, the tech giant has spent billions of dollars working on finding solutions to the “last-mile” problem in urban delivery. The company has built its own fleet of cargo jets, and explored delivery by drone in the form of “Prime Air.” More recently, an increasing percentage of that investment has been directed toward autonomous vehicle technology.

In January, the company introduced the Amazon Scout, a six-wheeled electric-powered delivery robot. Six of these robots are currently making deliveries in a Washington neighborhood during daylight hours, Monday through Friday. The next month, Amazon invested in Aurora Innovation, an autonomous tech startup run by former executives from Google and Tesla.

Penske is getting into car sharing through its Penske Dash subsidiary, with an initial launch in Washington, DC, and Arlington, Va. The trucking logistics, rental, and leasing giant, is offering Volkswagen Jetta SE models for rent by the minute, hour, or day through its proprietary app. Rates are inclusive of fuel, parking, and insurance.

The truck leasing and rental company has joined the race with three other rental companies — Hertz, Avis, and Enterprise — which have been testing out car-sharing projects in recent years. Avis has made the biggest splash with its acquisition of Zipcar.

Penske partnered with Ridecell, which is powering the mobile app, payment processing, parking info, and predictive analytics for the fleet. Members using the service have 24/7 access to a call center and a local fleet operations team.

Operational efficiency will be a big part of the unit’s success, the company said. “We can take advantage of infrastructure through our joint venture partners at Penske Corporation and Penske Truck Leasing, particularly on the service and roadside assistance portion of the car-sharing business,” said Michael Montri, chief operating officer.

Hyundai just announced it will launch a free ride-hailing service with a fleet of autonomous electric cars in Irvine, Calif., starting this month. The news comes after the South Korean automaker announced that it would invest $35 billion in autonomous and electric vehicle development over the next five years.

Hyundai is partnering with AV startup Pony.ai and ride-hailing service Via for the free taxi service. Interested riders can hail a self-driving car via a smartphone app. Korea’s largest automaker said it won’t be fully autonomous. Hyundai says a safety driver will be behind the wheel, and there will also be an additional engineer in the passenger seat.

It’s one piece in the Korean maker’s new global campaign. The company promotes itself as a world-leading smart mobility solutions provider that will be able to offer solutions through its cutting-edge technologies and solutions. That will offer customers “quality time and empower them to pursue their passions at full throttle,” the company said — and has been depicting it in a new global brand campaign called #BecauseofYou.

The first of these TV commercials was filmed in downtown Amsterdam during the morning rush hour. The commercials shows a female office worker being overwhelmed by the traffic — a crisis becomes instantly transformed when she steps out of her Hyundai Nexo fuel-cell SUV and hops onto a Hyundai electric scooter — solving the “last mile” dilemma becoming common in cities around the world with booming populations, and getting to her office on time.

Some automakers backing off:  While 2030 has been named the magic year in a few market reports and conference keynote speeches, the timeline for automated EVs to become the industry norm in global vehicle manufacturing and sales likely will be taking much longer. One auto executive recently spoke to the question.

“The hurdles to battery electric vehicles and complete autonomous driving are still quite high,” Honda CEO Takahiro Hachigo recently said in an interview at Honda Motor Co.’s global headquarters.

Honda will focus on gasoline-electric hybrids, not full EVs, through 2030. As for fully autonomous vehicles, Honda will roll out incremental advances that offer real-world safety at affordable prices. The automaker already has a number of new technologies ready to include in its new vehicle lineup, including a hands-off autonomous system for highways. But the company will be taking a “wait-and-see” approach with autonomous and electric vehicles.

Hachigo’s perspectives are shared by other leaders in auto manufacturing, including Japanese rival Toyota’s Executive Vice President Shigeki Tomoyama. The executive last month said in a speech that even with its $10 billion r&d budget, Toyota has always seen the path to commercialization as long and challenging.

Last month, Apple co-founder Steve Wozniak said he’s “given up” on ever seeing Level 5 fully autonomous vehicles being allowed on public roads during his lifetime. Apple is still working on a self-driving car project, but Wozniak said it’s become much harder to achieve than had originally been thought.

A new survey by J.D. Power last month supports the conclusion that reaching mass adoption will be taking well over a decade. The study found that consumer sentiment about self-driving vehicles and electrification has stayed flat recently, even through the technology growth has been impressive.

J.D. Power’s 2019 Q3 Mobility Confidence Index Study found that opinions haven’t changed since the last survey three month prior. The index now stands at 36 (on a 100-point scale) for self-driving vehicles and 55 for battery-electric vehicles — identical to the previous one.

“It was a little surprising to find consumer sentiment about self-driving vehicles and electrification has stayed flat,” said Kristin Kolodge, J.D. Power’s executive director-driver interaction and human-machine interface research. “But it shows that consumers are really steadfast in their opinions about new mobility technologies right now, regardless of how close they are to being available for purchase.”

The studies polled more than 5,000 consumers and industry experts on self-driving vehicles, and another 5,000 on battery-electric vehicles. One industry expert in the study agrees with colleagues on how tough the challenge has become. “Tech and automotive companies continue to learn how difficult the problem really is,” the expert said.

In February 2018, a global ride-hailing industry association was formed and found membership in several leading entities — BlaBlaCar, Citymapper, Didi, Keolis, LimeBike, Lyft, Mobike, Motivate, Ofo, Ola, Scoot Networks, Transit, Uber, Via, and Zipcar. They signed the Shared Mobility Principles for Livable Cities today, pledging to prioritize people over vehicles, lower emissions, promote equity and encourage data sharing, among other goals.

The companies estimated they provide about 77 million passenger trips per day in cities around the world. The Shared Mobility Principles offer a vision for the future of cities, and creates alignment between the city governments, private companies, and NGOs working to make them more livable.

These companies and a few others — Waymo, Apple, Tesla, other automakers and automotive suppliers — are expected to be at the center of all of it. Their roles and corporate identities will be transforming, but that will take shape well after 2030.

And in other news……..

Uber and other mobile apps fighting California’s new labor law:  California’s leading mobile app companies — Uber, Lyft, DoorDash, Postmates, and Instacart — will be fighting the state’s new law, AB 5, that was approved and signed by the governor in September. AB 5 will essentially be making drivers employees after it becomes enacted on January 1. The Silicon Valley mobility companies are backing what’s called the Protect App-Based Drivers & Services Act, which will become a ballot initiative for the November 2020 election once enough Californians sign a request to have it placed on that ballot. Uber, Lyft, and DoorDash have each contributed $30 million to get the initiative approved by voters; Postmates and Instacart are each contributing $10 million. If enacted, their law would cancel AB 5; it’s being written to ensure drivers and couriers can continue to be independent contractors with flexible work hours. Drivers have been marching in support of the new initiative, which will have incentives built in such as guaranteeing they receive at least 120 percent of minimum wage while on the job. It would reverse the new rules that AB 5 has created for the state. Legal battles are likely to take place in the state’s courts, with class-action lawsuits for workers and suits filed by the mobile app companies attempting to thwart AB 5. For now, Uber and the other Silicon Valley startups are being quiet about how their drivers will be treated after January 1 — if the companies will follow AB 5, or if it will be ignored as they scramble to organize their lobbying and legal battles.

Ford v Ferrari:  For car buffs and racing fans, “Ford v Ferrari” will be a real treat. Released in theaters this coming Friday, the movie dramatizes the 1966 Le Mans 24-hour endurance race, where legendary designer Carroll Shelby’s Ford GT40 was able to knock out reigning champion Ferrari. Mat Damon plays Shelby and Christian Bale plays maverick driver Ken Miles. The filmmakers borrowed cars shown in the film from California-based Shelby Legendary Cars and its parent company, Superformance.

Uber and Lyft riders not happy with LAX:  Airline passengers coming in to Los Angeles International Airport (LAX) have to wait longer now to get into their Uber and Lyft rides. Uber and Lyft passengers can no longer wait for the car to arrive curbside at terminals; they have to get on what’s called the LAX-it shuttle and be taken to an offsite station to meet their drivers. The airport continues constructing a major changeover, with a new people mover being set up to carry passengers across the expanding terminals. LAX ground transportation guidelines have been changing for a few years now, and passengers have become more agitated with the wait time and gridlock at the airport with continued construction and roadblocks. Airport administrators hope that setting up the new ride-hailing station will reduce traffic overall for drivers dropping off, and picking up, family and friends on the LAX terminal loop. Getting a ride from Uber and Lyft had been a convenient, cost effective transportation option in the past few years. That’s all changing now, with much of that efficiency being taken away. Air travelers and those driving them have been avoiding LAX whenever possible as traffic has gotten worse. Solutions for travelers include going to another nearby airport whenever possible. However, many cross country and international flights have to go in and out of LAX — and not the Orange County, Long Beach, or Ontario Airports. So changes at LAX greatly affect regular travels living and working in the LA and OC area. For taxi, chauffeured transportation, and shuttle operators, LAX’s changes affecting Uber and Lyft are just deserts for stringent and costly regulations imposed on them for several decades by airports and cities. Uber and Lyft are facing more regulations and fees in London, and the companies can expect government entities around the world to extend more of their own rules and fees as ride hailing continues expanding rapidly in these markets.

BYD Co. and Toyota Motor Corp. announced last week that they have signed an agreement to establish a joint company to research and develop battery electric vehicles (BEVs). The new R&D company, which will work on designing and developing BEVs (including platforms) and related parts, is anticipated to be established in China in 2020, with BYD and Toyota to evenly share 50 percent of the total capital needed. Additionally, BYD and Toyota plan to staff the new company by transferring engineers and the jobs currently involved in related R&D from their respective companies.

When will roads be filled with automated vehicles? Plus, official launch of Fisker Ocean

Here’s part four of a series on predictions that 2030 will be the watershed year to watch for when vehicles, transportation, and the entire auto industry itself will look quite different than it does today.

Five years ago, a speaker at AltCar Expo stirred up a lot of conversation among attendees and a few humorous references by panel speakers during the day. It was big enough for the speaker to be invited back the next year. Tony Seba, Silicon Valley entrepreneur and Stanford University lecturer, made dramatic forecasts about electric transportation, autonomous vehicles, and solar power. One of his revolutionary predictions is that all new vehicle sales in the US will be electrified and autonomous by 2030; and EVs will be powered by solar energy. The prediction came from his model analyzing the technologies’ exponential growth rates in the market.

Earlier that year, in May 2014, Google revealed a new prototype of its self-driving car, which had no steering wheel, gas pedal, or brake pedal, and being 100 percent autonomous. It set off a tidal wave of ambitious goals announced by automakers, media coverage and analysis, and a series of studies and speaker panels on what autonomous vehicles would mean — and how it will soon be the norm with US vehicles and possibly at a global scale.

During this year, KPMG and other analysts were not putting out likely timelines and significant benchmark years for autonomous vehicles (AVs) clearing regulatory hurdles and seeing mass production from major and specialty automakers, and an obvious presence on public roads. Seba’s “disruptive technology” theory is intruiging, but taking the latest look suggests that the new industry and technology hasn’t been building the needed momentum to see historic change over the next decade; not that it’s going to disappear, though.

Safety remains the key barrier to overcome for the new technology to clear regulatory hurdles and find public support. National Transportation Safety Board reports on Uber and Tesla tell some of the story.

Uber Technologies Inc.’s autonomous test vehicles were involved in 37 crashes in the 18 months before a fatal March 2018 self-driving car incident in Tempe, Ariz., the NTSB said on Tuesday. Between September 2016 and March 2018, there were 37 crashes of Uber vehicles in autonomous mode at the time, including 33 that involved another vehicle striking test vehicles. Uber’s self-driving test car that struck and killed a pedestrian in March 2018 wasn’t programmed to recognize and react to jaywalkers, according to the board. The NTSB on Nov. 19 will hold a probable cause hearing on the Arizona crash.

Tesla still has to resolve warnings sent out by fatal crashes that have been attributed to its Autopilot semi-autonomous feature. The National Transportation Safety Board (NTSB) in September cited both driver error and Tesla’s Autopilot design as the probable causes of a January 2018 crash, in which a Model S slammed into a parked fire truck at about 31 mph. The driver was distracted and did not see the fire truck, according to the federal agency. NTSB says that Tesla’s Autopilot was also at fault, as its design “permitted the driver to disengage from the driving task.”

KPMG published its second annual Autonomous Vehicle Readiness Index (AVRI) with a metric that takes into account four pillars to determine which country will lead the new transportation mode: policy and legislation; technology and innovation; infrastructure; and consumer acceptance. European countries dominated the rankings this year, with Netherlands at No.1, followed by Singapore, Norway, the US, and Sweden. Norway was a new entry to the list, and passed up the US — which has fallen one place to fourth.

Taking a look at the four categories used by KPMG in the study to develop the measures and methodologies reveals more. For policy and legislation, AV regulations, government-funded AV pilots, and AV-focused agency were key factors; Singapore leads this pillar. For technology and innovation, partnerships, patents, and investments are key factors, with Israel taking the lead this year. For Infrastructure, the Netherlands leads through having the most EV charging stations scaled by the size of its road network, as well as consistently high scores on the other measures. (More on those interesting categories below.) For consumer acceptance, Singapore scored highest overall in the KPMG study, partly due to all of the city-state’s population living in an AV test area.

For countries with a high acceptance rate in AVs, India and Mexico also took leading positions. Those living in Great Britain and the US are the least accepting. A new study by Society of Automotive Engineers International (SAE) with US respondents found that 73 percent of them preferred to share control with their vehicle. An overwhelming 92 percent said it is a requirement to be able to activate an emergency stop function in a self-driving car.

Here are a few other interesting details from the KPMG study and recent news:

  • When looking at the AV infrastructure, some of the factors being reviewed have been density of EV charging stations; quality of mobile internet; 4G coverage (the bridge to much faster 5G networks that are slowing coming out now); and quality of roads.
  • Americans tend to be skeptical about trusting AVs in surveys. But one area of mobility experience that may help adoption in the US and a few other markets is ride hailing. China leads in market penetration of ride-hailing, followed by the US and the UK. Some of the most interesting test projects have involved partners working toward bringing robotaxis and shared rides in AVs — GM working toward its Maven car-sharing unit offering autonomous vehicles including the all-electric Chevrolet Bolt. Uber and Lyft have been investing in it, with Waymo leading the way.
  • Baidu is leading the way in China. China’s search-engine giant is getting the most test miles under its belt, which is critical in building public support for the new technology.
  • Volkswagen is stepping up its efforts to become a leader in autonomous vehicles and ride services by spinning off its own startup that it claims will be among the “best-funded” in the world. Volkswagen Autonomy, or VWAT, plans to bring robot taxis and cargo vans to three continents by 2025.

 

And in other news:

Fisker launch announced:  Fisker Inc. has launched it long-awaited all electric luxury SUV, which the company has named the Fisker Ocean. The company said it will be the “world’s most sustainable vehicle,” built on recycled, vegan and more innovative materials. Fisker said it will be breaking the usual automaker product launch process by revealing a fully running production intent prototype sitting on the actual, completely engineered platform on Jan. 4, 2020. Early reservations will start with the launch of the mobile app later this month, when pricing will be announced. The battery electric vehicle will have 250 to 300 miles per charge, depending on driving conditions, that will come from an approximately 80 kWh lithium-ion battery pack. To learn more, visit www.FiskerInc.com.
BMW and Ford providing charging networks:  The BMW Group will install over 4,100 charging points for electrified vehicles at its German locations by 2021. The new charging infrastructure enables BMW Group employees to charge their cars conveniently at their workplaces. About half of the charging points will also be open to the public. That follows a recent announcement from Ford that it will be offering its all-electric vehicle customers North America’s largest electric vehicle public charging network, with more than 12,000 places to charge, including fast charging, and more than 35,000 charge plugs. Ford said it will be more charging infrastructure provided than from any other automaker. Through FordPass on a mobile device or in each vehicle’s on-screen dashboard, customers will be able to monitor charging at home, and find and pay for easy, one-stop charging at FordPass Charging Network stations.

Volvo Trucks selling EVs in Europe:  Volvo Trucks announced the start of sales of its Volvo FL and Volvo FE electric trucks in selected markets within Europe, meeting the increasing demand for sustainable transport solutions in city environments. “Global urbanization requires urban logistics and truck transport with zero emissions and less noise with increasing urgency. With the Volvo FL Electric and Volvo FE Electric we are able to meet both the strong environmental demands as well as the high commercial requirements of our customers,” said Jonas Odermalm, VP Product Line Electromobility.

Will EVs transform the auto industry by 2030? And more on Trump administration versus California

Here’s another look at forecasts predicting 2030 will be the watershed year to watch for when vehicles, transportation, and the entire auto industry itself will look quite different than it does today. This time, we’ll look at whether plug-in vehicles are likely to overtake internal combustion engine-powered vehicles by 2030.

A new Science magazine article states that: “Electric vehicles are poised to transform nearly every aspect of transportation, including fuel, carbon emissions, costs, repairs, and driving habits.”

That will come from planned mandates coming up soon, that if enacted, include Norway wanting to have all its vehicles be battery electric or plug-in hybrid by 2025; Netherlands banning all gasoline and diesel vehicles by that year; Germany banning internal combustion engines by 2030; and France and Great Britain ending gasoline and diesel car sales by 2040. Not to mention China’s subsidies moving sales of new energy vehicles and Europe and the US seeing strong EV sales. What’s the tipping point? Battery technology, which have a host of challenges to overcome, according to the author.

I would say that two developments will likely slow the pace of EV sales growth we’ve seen over the past nine years, and extend the timing of when we see them make a substantial global impact. One is China cutting its generous subsidies, and the other being a battle between the Trump administration and California’s clean car standards (see news section for more on the battle).

EV sales are declining for now, but how long will that last?

The chart below takes a look at the past decade of battery electric and plug-in hybrid sales since the launch of the Nissan Leaf and Chevrolet Volt in late 2010. A few points stand out while reviewing the short history of mass market production-level electric vehicles.

EV sales trends since 2011:  The US was the market leader until 2015, when “new energy vehicle” subsidies began flowing in China and more electric vehicle product offerings entered that market. European countries also began seeing more acceptance of the technology and more EV models to consider. Norway continues to be No. 3 in global EV sales with its extensive government support in subsidies and charging infrastructure. Japan has been in the top five countries for cumulative EV sales.

Two thousand fifteen was the outlier year for US sales, with one of the factors being the Chevrolet Volt dropping in sales as the new next-generation Volt with range boosted from 38 miles to 53 started showing up at dealerships late in the year. Other market trends that pulled EV sales down were low gas prices, fewer incentives, and a broader market shift away from cars and toward SUVs and pickup trucks. But global EV sales kept their upward trajectory, leaping 71.58 percent in 2015 over 2014.

China is by far the leading sales market, with the US following in second with about a quarter of China’s EV sales in the past two years. China’s NEV sales data includes passenger vehicles and heavy-duty commercial vehicles such as buses and sanitation trucks. China’s new energy vehicle mandate and its generous subsidies have brought the purchase prices down substantially. Building out its charging infrastructure has helped, too, as has the launch of a long list of NEVs built and sold by Chinese automakers and joint ventures between foreign automakers and local automakers.

Battery electric vehicles are leading by far in key global markets over plug-in hybrid electric vehicles. Last year, BEVs had 66.8% of the US plug-in vehicle market. By December 2018, the stock of new energy vehicles sold in China since 2011 saw 79.4% as BEVs. In Europe during 2018, the sales numbers were closer, with BEVs in the lead by over 40,000 units — 223,284 BEVs and 182,768 PHEVs.

As for popular models, here were the top 10 global sellers in 2018:
1. Tesla Model 3 — 145,846 units sold
2. BAIC EC-Series — 90.637
3. Nissan Leaf — 87,149
4. Tesla Model S — 50,045
5. Tesla Model X — 49,349
6. BYD Qin PHEV — 47,452
7. JAC iEV E/S — 46,586
8. BYD e5 — 46,251
9. Toyota Prius Prime — 45,686
10. Mitsubishi Outlander PHEV — 41,888
Source: InsideEVs

These sales figures show a few trends, one of which is how important the US continues to be for Tesla’s sales. Of the 145,846 Model 3s sold last year, 139,782 were sold in the US. About half of the Model S and Model X units delivered last year were sold in the US with Europe being important for Tesla’s growth. Now with its China plant starting up, that market is expected to be very important for future sales and model introductions.

The BAIC, BYD, and JAC models are sold almost exclusively in China, although BYD is continuing to sign more contracts for electric buses and other commercial vehicles around the world. The Nissan Leaf and Mitsubishi Outlander PHEV are seeing more success outside the US, with Europe being the main marketing focus.

Forecast reports usually cite upcoming vehicle emissions rules, governments moving toward banning gasoline- and diesel-powered vehicles, growth in Level 2 and fast-charging stations, and a wide variety of plug-in vehicle offerings — with many more coming to market over the next decade. Automakers expect the pricing to come down as battery costs decline and EV drivetrains, parts, electronic systems, and exterior and interior design, become more economical and efficient in the near future.

What automakers have in the pipelines: Another topic in the reports has been commitments made by manufacturers to roll out an extensive lineup of plug-in vehicles — and sometimes more hybrids and fuel cell vehicles.

The Volkswagen Group continues to lead the charge, expanding its list of new launches in March from 50 to 70 in the near future. The company expects to be building 22 million plug-in vehicles with its new electric drives, such as the MEB, over the next decade on the VW, Audi, Porsche, and SEAT brands — an increase from 15 million in the initial target. The German automaker has collaborated with the Petersen Automotive Museum in Los Angeles to demonstrate its vision of EVs and mobility of the future next month. “Building an Electric Future” will open November 20 and will celebrate Volkswagen’s history both globally and locally, as well as introduce VW’s new electric concept vehicles. A global concept unveiling of an all-new ID concept vehicle will take place at a private event on Tuesday, November 19.

BMW AG plans to increase sales of its battery electric and plug-in hybrids by 30 percent every year until 2025 to help meet incoming stringent emission regulation in the European Union. The company moved up its goal for rolling out a lineup of 25 all-electric and plug-in hybrid models by two years to 2023. This would mean BMW will have sold a total of about 700,000 plug-in vehicles by 2025.

Daimler plans to release 10 different all-electric vehicles by 2022. The company is taking a holistic approach to electrification under the new EQ technology and product brand and a charging infrastructure to support it. Daimler will also be electrifying the entire Mercedes‑Benz portfolio. Customers will have the choice of at least one electric alternative in every Mercedes‑Benz model series, taking the total to 50 overall.

Ford Motor Co. is increasing investments in electric vehicles to $11 billion by 2022 and will have 40 hybrid and fully electric vehicles in its model lineup. In April, Ford said it planned to launch more than 30 new Ford and Lincoln vehicles in China over the next three years as it tries to reverse a decline in sales in the world’s biggest auto market; and about one third of them will be EVs. This summer, Ford revealed its first all-electric SUV for that market, the Territory EV, built on Chinese partner Jianling’s compact SUV. It follows a plug-in hybrid variant of the Ford Mondeo, and will be its second plug-in vehicle for the Chinese market.

Toyota has a company goal of selling 5.5 million electrified, Toyota-brand vehicles annually by 2030, up from about 1.6 million vehicles now. The company set up a $10 billion r&d fund for catching up with competitors, and has created a new EV architecture that offers flexibility in size and battery power.

Honda announced a week ago that it will sell only plug-in electric and hybrid vehicles in Europe starting in 2022, three years earlier than previously planned. The Japanese automaker will be launching six new models in Europe over the next three years. The company said it shows its confidence in the technology and seeing regulatory changes that are changing the course of Europe’s auto industry. “The pace of change in regulation, the market, and consumer behavior in Europe means that the shift towards electrification is happening faster here than anywhere else,” said Tom Gardner, senior vice president at Honda.

Tesla has three models poised to come out in the next few years. The Tesla Roadster 2020 is the first-ever follow-up to the company’s debut electric car, the Roadster 2008. CEO Elon Musk boasts that the upcoming supercar will be able to go from 0 to 60 in 1.9 seconds, and can reach a top speed of 250 miles-per-hour. It will cost at least $200,000 when it rolls out next year. The compact SUV Model Y was revealed in March 2019, and will be the company’s second mass market model after the Model 3. It will be able to go 300 miles on a single charge, and it will begin shipping in late 2020 with the standard range model following in Spring 2021. Starting prices for four different variations will go from $39,000 to $60,000. Musk brags that it will have SUV functionality, it will ride like a sports car, and will be the safest SUV in the world. The Tesla Semi heavy-duty truck will go into production next year, and will go nearly 400 miles on a 30-minute charge. The company also says it will go from 0-60 in 20 seconds while hauling 80,000 pounds. It’s expected have a $180,000 starting price.

BYD Company Ltd. sold a total of 520,687 vehicles in 2018, which was made up of petroleum-powered models, all electric, and plug-in hybrids. A Deloitte study forecasted that by 2030, the company will be selling about 18 million units, following Tesla’s expected sales that year of about 22 million vehicles. However, I consider both of these forecast numbers to be extremely optimistic. Last year, BYD narrowly beat Tesla in deliveries to be No. 1 in the world — BYD sold about 250,000 EVs compared toTesla’s 245,240. In April, the company announced six new EV models will be coming up, a mix of all-electric and plug-in hybrid. In July, BYD announced an alliance with Toyota to develop EVs that will be coming out in China between 2020 and 2025. For now, the company is investing heavily in building its clientele for commercial vehicles such as electric buses and trucks in markets all over the world.

Market softening lately:  The last three months have been tough for the Chinese makers, and the US has followed a similar pattern. Year-to-date, the end of September saw global EV sales down to 157,696 units from 175,362, breaking the traditional market growth. US EV sales dropped down to 236,067 for the year as of Sept. 30, 2019 compared to 234,635 for the year on Sept. 30, 2018. September 2018 sales reached 44,589 while September 2019 saw sales down to 33,128 units.

Reductions in electric vehicle subsidies and a cooling economy impacted the Chinese market. The US is seeing a similar sales slide withe overall new vehicle market down 12 percent in September from the previous year, while EVs were down 25.5% year-over-year. One reason for the drop is that the Tesla Model 3 had an unexpectedly high ramp up of production in the second half of 2018.

Tesla Model 3 deliveries are slightly up over last year — 236,067 for the year at the of September, versus 234,635 units through the end of September 2018. The US plug-in vehicle market is expected to decline through this year before a rebound starts next year.

What the forecast numbers look like:  The most commonly cited forecast on 2030 comes from The International Energy Agency’s New Policies Scenario. The study expects that by 2030, global plug-in vehicle sales will reach 23 million for that year and the stock of owned EVs will exceed 130 million vehicles (excluding two and three-wheelers). That’s under one forecast analysis including the impact of announced policy ambitions by several governments; the IEA scenario includes another potential outcome where the number shoots up to 43 million with the stock coming to more than 250 million.

There’ve been other forecasts. In May, Mining and resources giant BHP forecasted that electric vehicles could achieve more than 50 percent share of global new vehicle sales by 2030, and 100 per cent of all vehicle sales by 2050.

Global new vehicle sales are expected to come in at about 80 million units this year. Germany’s Center for Automotive Research (CAR) predicts that in 2022 sales will rise back to 84 million.

Let’s say new vehicle sales reach 100 million by 2030. How much of it would likely be new plug-in vehicles?

Between 2011 and 2018, new EV sales in the US averaged a 56.8 percent annual increase, and global had an average of 67.34 percent. To refine the numbers to more recent market trends, between 2014 to 2018 the average annual growth for US plug-in sales came to 33.69 percent. For global sales, the average annual sales growth between 2014 to 2018 was 57.14 percent with China leading the boom.

Global car and light commercial vehicle sales in 2018 came to about 86 million new vehicle deliveries. Battery electric and plug-in hybrid vehicle sales came in at 2,018,247 units last year — 2.34 percent of the total. New vehicle sales came in at 17.27 million in the US last year; at 361,307 units, EVs made up 2.09 percent of that total.

So let’s say market conditions look similar in the next few years, without big changes enacted such as a fossil fuel ban in a sizable country. What would that look like?

At the rate of 57 percent in global annual EV sales increases, plug-in vehicles would make up 100 percent of the global new vehicles sales market during 2027. As that scenario would be impossible to reach (aside from an unforeseen miracle), what about viewing a much more conservative forecast — 10 percent annual growth in EV global sales under current market conditions? While a much lower percentage, 10 percent could be realistic given China will be soon cutting out its subsidies, blockades are coming from the Trump administration, downward auto sales in several countries will continue for a while, gasoline prices are staying fairly low, and challenges persist for convincing consumers and fleets to transfer over to EV purchases — charging infrastructure, battery capacity, range getting much better, and perceived long-term value and trustworthiness of transitioning over from ICEs to EVs.

Let’s also assume that EVs making up at least 50 percent of global new vehicle sales would make for a realistic tipping point in emissions reductions, lessening dependence on oil, and hitting a few government targets.

Going with the 10 percent annual sales growth scenario would only bring the number up to about 5,757,995 new EVs sold globally by 2030 — just shy of 6 percent of global new vehicle sales, given the forecast of 100 million units sold by 2030. A recent IHS Markit study, which takes a conservative approach, sees EVs making up 7.6 percent of total new vehicle sales by 2025.

If you take 25 percent annual EV sales growth in global sales, it’s going to look a lot more like the low-end forecast of another study this year. The IEA’s New Policies Scenario expects that by 2030, global EV sales will reach 23 million for that year and the stock of owned EVs will exceed 130 million vehicles.

Perhaps 2040 to 2050 is a more realistic scenario for EVs playing a major role in new vehicle sales, emissions reductions, and having a major impact on oil prices — in terms of hitting the 50 percent mark. If government mandates are enacted and enforced, it would be closer to 2040.

BloombergNEF’s “Electric Vehicle Outlook 2019” report came to a similar conclusion.  The report shows that EVs will take up 57 percent of global passenger vehicle sales by 2040. Electric buses will dominate their sector, holding 81 percent of municipal bus sales by the same date, according to the report.

Norway, Germany, France, China, Costa Rica, South Korea, the UK, Japan, Spain, Taiwan, Portugal, Netherlands, Israel, India, Denmark, and Ireland have proposed a ban on fossil-fuel powered vehicles. Previous Prime Minister Theresa May in June signed the “net-zero” mandate that would cut emissions 80 percent by 2050 compared to 1990 levels. Britain is the first G7 country to commit to a net zero greenhouse gas emissions target for 2050. The new Prime Minister, Boris Johnson, is continuing support for the net-zero emissions mandate.

BMW Group may present a more realistic view of how most global automakers are likely to perform in commitment to the new technology in the short term — a slower and gradual strategy rather than launching 20 or more new EV models with a commitment to roll them out in vast numbers by 2025 to 2030 (that VW and other OEMs are championing). BMW predicts it will have sold about 700,000 plug-in vehicles sold by 2025.

The German automaker just released a sales report on EV market share, or “Electromobility in Europe.” The study says that BMW has 13 percent of European sales and Tesla has 20 percent. As for the US, BMW had six plug-in models sold through September, coming in at 9,875 vehicles delivered — 4.18 percent of the country’s EV market.

So, what market conditions will be needed to reach the 50 percent mark? These factors are sure to be watched for:

  • Continuing falls in the price of EV batteries. One study reports that since 2010, the average cost of lithium-ion batteries per kilowatt-hour has fallen by 85 percent.
  • Extended range of battery power, 300 miles per charge.
  • Fast charging networks in high-traffic zones, with free access or reasonable user pricing.
  • China’s new energy vehicle mandate, and whether the national government decides to bring it back. Subsidies have also been generously spread by a few other countries (especially Norway); and states, provinces, and cities in North America, Europe, and Asia. Will these continue, and for how long?
  • The future of California’s Advanced Clean Cars Program, and the battle between the state and the Trump administration over the future of those rules and the national standard.
  • Fleet acquisitions, including the Electrification Coalition launched in 2018 and announced by LA Mayor Eric Garcetti — an online portal that provides cities with a single, equal price for EVs and charging infrastructure by aggregating the demand from Climate Mayors cities and other public agencies.
  • Commercial applications for electric vans, light- and medium-duty trucks, and for municipal buses, will make a significant difference. That’s been the case in China, and is starting to take hold in the US and Europe.

EVs have the potential to become the leading powertrain system used in autonomous vehicles in the next couple of decades. The next feature exploring the 2030 trend will analyze when its likely to see regulatory hurdles cleared and self-driving vehicles going into high-volume production.

A few interesting news briefs:
Battle over clean car rules:  General Motors, Toyota, FCA, Hyundai, and the National Automobile Dealers Association, are backing the Trump administration’s efforts to gut fuel economy standards and California’s ability to keep the bar high. These companies said that in a filing with a U.S. appeals court late on Monday, arguing the administration’s rule provided “vehicle manufacturers with the certainty that states cannot interfere with federal fuel economy standards.”
In July, Ford, Honda, and Volkswagen made a deal with California supporting the state’s policies. The Trump administration is preparing to roll back next month the fuel efficiency standards set by the Obama Administration and revoke California’s ability to set stricter clean-car standards, including the zero-emission vehicle (ZEV) mandate. Last month, the US Environmental Protection Agency and National Highway Traffic Safety Administration published its overhauled rule, called “SAFE Vehicles Rule Part One: One National Standard,” to take effect November 26.

Aftermath of GM strike:  The United Auto Workers and General Motors agreed to partner under their new contract to manage the impact of new technologies that could threaten thousands of jobs. The National Committee on Advanced Technology would meet quarterly review changes the automaker must implement as it tests 3D printing, plans to bring autonomous taxi rides to the streets, and globally rolls out 20 battery-electric vehicles that require fewer parts than their internal combustion counterparts. GM says these EV will come to market by 2023. The Chevrolet Bolt’s powertrain has 80 percent fewer moving parts than a comparable car with a gasoline engine, experts have said. And autonomous vehicles won’t need steering wheels, brake pedals and instrument panels, an expert said. The union has expressed concerns over thousands of jobs going away from these historic changes being made. The automaker has slashed its earnings forecast for 2019, saying that the strike would cost it around $3 billion in profits this year. Production was going back to full speed earlier this week.

Factory expansion for electric truckmaker:  Orange EV, the first original equipment manufacturer to commercially deploy all-electric electric Class 8 trucks, just announced its second facility expansion in four years, moving to a site with more than five times the production capacity in Kansas City, Mo. Orange EV’s Class 8 Heavy Duty terminal trucks have been commercially deployed since 2015, operating daily in railroad inter-modal, LTL freight, manufacturing, distribution centers, port operations, waste management, trans loading, cross docking, warehouse, yard management, third party logistics (3PL), and other container handling operations. More than 60 fleets have chosen Orange EV pure electric terminal trucks for commercial deployment in 14 states across the US. In California, Orange EV trucks have been purchased and are in use at more than 40 customer locations.

Tesla earnings:  Tesla Inc’s third-quarter revenue fell 39 percent in the US, a regulatory filing showed. A record number of cars shipped in the third quarter of 2019 were enough to help Tesla turn a modest profit, according to financial figures released by the electric carmaker on Wednesday. The company reported $143 in net income, and $6.3 billion in revenue — down slightly from second quarter and down about $530 million from Q3 2018. Tesla reported that the drop in revenue comes from a tripling in the number of customers leasing its cars, mainly from Model 3 leases that launched in April of this year.

EV cash for clunkers:  US Senate Minority Leader Chuck Schumer (D-NY) proposed a plan last week in an op-ed piece that would provide car owners with “large discounts” if they trade in their polluting, gas-powered vehicles for “clean” electric ones. It would be similar to the the Obama administration’s “cash-for-clunkers” program initiated in 2009. The legislation has yet to be written and introduced, but is based on supporting that every vehicle on the road is zero-emission by 2040; and the legislation would result in 63 million fewer gasoline-powered cars on roads by 2030.

GM strike won’t be ending anytime soon, What to expect by 2030 part 2

The United Auto Workers’ strike shows no signs of ending anytime soon — putting more than 48,000 workers in the US off the job since Sept. 16 and costing General Motors more than $1 billion as of Monday; and supplier partners are loosing hundreds of thousands per day. Virtually all of its North American assembly lines are off-line as labor and management attempt to negotiate a settlement contract over wages, healthcare, and job security on the labor side and management’s vision of where it needs to go in the future. Last month, the UAW signed indefinite contract extensions with Fiat Chrysler Automobiles and Ford Motor Co. The GM contract has historically set the tone and some of the details for the next wave with the other two major domestic automakers.

Contract settlement details from a Monday night offer from GM began to emerge yesterday. Wage increases or a lump-sum payment offered over four years of the proposed contract have been added. The union had rejected the initial offer and submitted a counterproposal Tuesday over disagreements on health care, wages, temporary workers, skilled trades, job security and “concessionary” measures. Talks are expected to resume today.

Along with the strike, two more former UAW leaders have agreed to cooperate with federal prosecutors as the government builds a criminal case against some of the union’s leaders for embezzling more than $1 million funds for personal luxuries. Since it started, the corruption investigation has been marked by federal raids and criminal charges against 11 people linked to the UAW and Fiat Chrysler Automobiles. So far, nine convictions have been secured over breaking labor laws, taking kickbacks, bribes, and embezzlement. The crisis continues to raise flags over the future of the UAW — and how it will affect the GM strike.

Gaining loyal union membership has been a tougher sell in the US than in Europe and other parts of the world. Membership has been declining since the 1970s, with corruption scandals and strikes adding to worker frustration and declining public support. None of the “transplant” foreign automakers operating in the US have unionized workers. Volkswagen workers at the Chattanooga, Tenn., plant rejected UAW membership in June. Tesla chief Elon Musk continues to fight off moves by the UAW and complaints filed under state labor laws. A California judge ruled Friday that Musk and other company executives have been illegally sabotaging employee efforts to form a union. While these are considered unfair labor practices, Tesla doesn’t face any real penalties.

The economic trends started in the 1970s are continuing — closing plants in the US and opening them up again in other countries with cheaper labor and other costs; bringing in robotics to take over more of the assembly plant jobs; adopting the latest technologies to meet consumer demands, government regulations, and to gain competitive brand images to increase sales and profits. As economists have said in recent years, globalization, technology innovation, and corporate profits, are the defining elements in the future of corporations. Workers have less voice and are being pushed into looking for alternative futures for themselves and their kids. It’s a tough change to make for those coming from multi-generational families and communities that had done very well with auto industry jobs.

Management careers have also been hard hit over the past 30 years as well — with layoffs and forced geographic moves overseas disrupting the lives of thousands of low-to-mid-level management employees. High-level executives have also seen their share of turmoil since the Great Recession, with several surprising cuts being made as major automakers merge with former competitors and startup new business units to meet the fast-changing world of mobility. Shareholders expect to see better profit margins and stock prices, no matter what.

What to expect by 2030 part 2: What generation is most likely to lead the mobility transformation?  General Motors CEO Mary Barra is confident her company will be taking a leading role in mobility services of the future. For those less interested in owning a car, or having to drive and park it everywhere, what about sharing an autonomous Chevy Bolt through your local Maven outlet? Just tap into your mobile app and have it show up in front of your workplace.

The big question becomes: Who will be the customer?

Millennials (about 23 to 38 years old in 2019) broke open barriers by waiting longer to buy their first car — and becoming rabid fans and riders with Uber, Lyft, Zipcar. There have been other on-demand mobility services in meal delivery, groceries, and other needed services for extremely busy people ready and willing to pay.

Some things are changing — with Millennials in the US buying property less than the two generations ahead — Generation X and Baby Boomers. They’re moving to cities and seeing rent, lease payments, and property values shoot up. They’d also lived through the Great Recession, and are carrying concerns over another bout of economic turbulence coming up.

But when it comes to buying cars, Millennials are becoming a lot like previous generations, though they are interested in trying out electrified models — battery electric, plug-in hybrid, and hybrid. And Millennials still make up the lion’s share of Uber and Lyft riders; though the next generation is taking its share of rides, too.

Generation Z — teenagers through age 23 — are still a bit young to determine what sort of economic impact they’ll be having on car sales and other markets. One thing they do have in common with Millennials is being challenging in the workplace. It’s very typical to talk to managers in their 40s through 60s and hear complaints about getting them to do their jobs as they’ve been asked to do — very different from their experience. Supervisors advise that you think a bit differently about where the “youngsters” are coming from. They do tend to be talented, hard-working employees, but it might take a bit longer — and employers are advised to help them find their own sense of purpose and meaning in their work.

A recent survey study by Allison+Partners suggests that changing definitions of transportation and an influx of new mobility solutions are paving the way for the birth of the “mobility culture.”

Gen Z has even less interest in getting their driver’s licenses than previous generations. They see cars as yet another appliance they’ll need to have access to someday that ranks up their with smartphones and gaming machines like Xbox. In the study, they said autonomous vehicles make a lot of sense, and 60 percent of them believe they’ll be using self-driving cars by 2030.

Owning their own prestigious car — whether that be a Tesla or a Lexus — doesn’t matter as much, or make as much sense. Coming of age as the recession finished up, and smartphones became the new norm, pragmatism is the benchmark. The Allison+Partners study concluded that Gen Z will be the first generation in large numbers to get rides from Waymo, Maven, Uber, Lyft, and the next iteration of offerings from Tesla, Volvo, Audi, BMW, Toyota, Honda, and other makers rolling out new options in connectivity, automation, electrification, and safety — along with mobility services of their own.

Mobility won’t be taking over by 2030, with new vehicle sales continuing to see growth in global markets — and concerns over safety and reliability will take several years to be alleviated, especially for autonomous vehicles. But the transformation appears to be occurring, with Gen Z taking the lead.

A few interesting news briefs:
Ford and Mahindra:  Ford is lessening its presence in India, taking a 49 percent share to Mahindra’s 51 percent through a new joint venture managed by Mahindra in the troubled auto market. The two companies will continue working on developing battery-powered cars, but Ford is needing to scale back in a key global auto market that’s been plunging in sales for nearly a year (and one that rival General Motors left in late 2017). The Indian government has been issuing incentives to grow electric vehicle sales, which have been down to only about 2,000 a year — nowhere near what New Dehli wants to see for emissions targets and reliance on oil imports.

Tesla in China:  Tesla’s Shanghai factory plant aims to start production this month but it is unclear when it will meet year-end production targets due to uncertainties around orders, labor, and suppliers. Tesla plans to produce at least 1,000 Model 3s a week from the new factory by the end of this year. The $2 billion factory gained government approval last month and is on schedule to start production in October, the sources said.

Amazon making biggest EV purchase ever:  Michigan-based startup Rivian Automotive will be building and delivering 100,000 electric vans to Amazon over the next decade. The first 10,000 will start hitting roads in 2021 and completing the delivery the next year, with all 100,000 EVs fully operational in Amazon’s fleet by 2030. It makes for the largest EV purchase ever. Amazon chief Jeff Bezos said 100,000-unit fleet will eliminate 4 million metric tons of carbon emissions when fully operational.

Electrify America chargers:  Volkswagen’s Electrify America announced yesterday that it will be offering Level 2 electric vehicle home chargers. Customers can now purchase the Electrify America Electric Vehicle Home Charger on Amazon for $499. The product is also accessible through electrifyamerica.com/charging-at-home. The company said its compatible with all electric vehicles available in the North American market today. It features a charging power of up to 7.6kW – about 6 times faster than the typical Level 1 charger provided to some new EV owners, depending on vehicle make and model.

 

 

How a major oil refiner is earning GHG credits in California

For anyone wondering how things are going in California with compliance to AB 32 and the 2016 revision demanding that greenhouse gas emissions be scaled back 40 percent to 1990 levels by 2030, here’s a quick case study. Marathon Petroleum Co. is asking for permission to generate Low Carbon Fuel Standard (LCFS) credits at its Tesoro refinery in Martinez, located in the East Bay of the San Francisco Bay Area. California Air Resources Board posted a refinery project application for public comment on Sept. 20, which will close on Sept. 30, 2019.

You can read CARB’s summary of the project, which the agency said it plans to endorse if all the received comments are addressed satisfactorily by Marathon. In 2017, the company took on an electrification project that replaced a natural gas-fired turbine with an electric motor that drives the refrigeration compressor at the alkylation unit. The project also reduces criteria air pollutants and toxic air contaminants emitted by the refinery. (By the way, the Tesoro brand name is going away following a 2017 rebranding as Andeavor Corp. and a $23.3 billion merger last year of Andeavor and Marathon. Now everything falls under the Marathon corporate logo.)

The Martinez refinery has crude oil capacity of 161,000 barrels per calendar day (bpcd), and employs about 740 workers. Marathon’s other California location, the Los Angeles Tesoro refinery based in Wilmington, has crude oil capacity at 363,000 bpcd, about 1,620 employees, and is the largest refinery on the west coast. Marathon is earning additional LCFS and other California credits at the Watson Cogeneration Plant located within the Wilmington refinery’s complex. The  cogeneration plant produces 400 megawatts for local refineries and sells excess electricity to the local utility grid. Marathon and Tesoro bought former majority owner BP’s share in 2012.

Marathon explained to investors in its annual report that the company has to meet compliance with the state’s stringent climate change and clean air rules — and LCFS credits and the state’s cap and trade quarterly auction system are the best ways to hit the target. “We may experience a decrease in demand for refined products due to an increase in combined fleet mileage or due to refined products being replaced by renewable fuels. Demand for our refined products also may decrease as a result of low carbon fuel standard programs or electric vehicle mandates,” Marathon said in its 2018 annual report.

The LCFS requires a gradual reduction in carbon intensity, reaching a 10 percent reduction in 2020, and last year CARB extended that out to 20 percent by 2030. CARB sees LCFS working well, helping the state meet its 3 percent annual GHG reduction targets and helping to clean the air at some of the nation’s most polluted metro zones. It’s also spurred innovation in low-carbon transportation fuels such as hydrogen, electricity, biodiesel, and renewable natural gas.

Oil companies and refineries have done their share of pushing the state to rollback some of the stringent and costly requirements that the oil industry (and others such as power plants) has to meet. But more of the battle was against farmers and ethanol producers over blocking extending the national E-10 gasoline standard to E-15 or higher. California’s compliance options have been more viable for some of the oil companies and refineries.

In June, CARB reached a $1.36 million settlement with Tesoro and owner Marathon for violating the LCFS. The company had informed CARB of its misreporting of its transportation fuels sold in California. Marathon does seem to accept the challenges of doing business in California and probably won’t be pulling the shutters on its refineries anytime soon. While there are less expensive states to do business in, California is a major market for oil shipping, refining, and keeping gas stations supplied.

It’s been a win-win scenario for California with GHG reductions and well-funded clean transportation and renewable energy programs coming from compliance. In October, CARB approved a $483 million plan to fund clean car rebates, zero-emission transit and school buses, clean trucks, and other innovative, clean transportation and mobility pilot projects. Of that total, $455 million came from the cap-and-trade program, and the remaining $28 million came from the Air Quality Improvement Program. Another recent contribution came from $92 million in LCFS credit funds supporting transportation electrification in 2016.

California’s LCFS is being adopted in other states and Canada, and its ZEV mandates and clean vehicle incentives have followed a similar path. The state led a federal lawsuit filing on Friday that includes 22 other states against the Trump administration’s move to revoke their rights to enact fuel economy and emissions rules outside the national standard. It includes those 13 states that had joined California’s coalition following its vehicle emissions rules — but it also includes states like Michigan, Wisconsin, and North Carolina that Trump had won in the 2016 election. It’s a an age-old battle in the US: state rights vs. Washington’s ultimate power; and it shows the wide polarity between the Trump administration and the state of California.

Q&A on California’s AB 5 and how Uber and Lyft will be impacted, Saudi Arabia drone airstrike escalates oil tensions

A landmark law that would make many gig economy workers employees was approved by the state senate late Tuesday night in California, after months of tension between labor groups, on-demand mobile app companies like Uber and Lyft, and workers’ rights advocates. After endorsing Assembly Bill 5 on Labor Day, Governor Gavin Newsom is expected to be signing the bill into law very soon. If so, the measure will go into effect on Jan. 1, 2020.

Experts say AB5 has the potential to curb labor violations, increase employee bargaining power, and fundamentally alter California’s booming gig economy. US Senator and presidential candidate Bernie Sanders has introduced a similar bill in Washington (Workplace Democracy Act), and other states are expected to launch copycat bills in their legislatures. Labor unions could be brought in, or some other entities representing groups of workers for collective bargaining and enforcing the new law (such as new groups including Gig Workers Rising.) It was first introduced in December by Democratic Assembly member Lorena Gonzalez Fletcher, and since then the bill has gone through several iterations.

The state wants to stop losing tax revenue — which is another part of how it came to be. California’s Department of Industrial Relations estimates that the state loses about $7 billion a year in payroll taxes due to company misclassification.

What companies will be most affected by it?

Under AB 5, close to one million ride-hailing workers, on-demand delivery drivers, manicurists, and janitors in California will be eligible for the same benefits, minimum wage, and vacation days that full employees are. The final version of the bill includes exclusions for certain industries: lawyers, architects, realtors, hairstylists, fishermen, and freelance writers and editors. That’s based on their jobs not being subject to the law because their industries allow them to negotiate.

The companies most affected will be app-based on-demand mobility companies — in California its made up of about 400,000 people driving for Uber and Lyft, delivering meals for Postmates and DoorDash and groceries for Instacart, other competitors in mobile app services, and for those fulfilling specialized services such as Task Rabbit. A few of these companies, led by Uber and Lyft, say that the law will provide an existential threat to their continued existence. Barclays estimates that Uber’s annual operating costs in California will grow by more than $500 million, and Lyft’s will grow by $290 million.

Trucking firms are quite concerned about AB 5 impacting their profits, as working with independent contractor truck drivers has been common in the industry for years. The bill was opposed by the California Trucking Association through the argument that one of the laws’s standards would make it difficult, if not impossible, to continue using independent contractors. In more recent years, startup firms have been using Uber’s model with a software platform that can bring together drivers with trucking companies for freight-hauling trips.

Who will be representing drivers?

That’s one of the leading questions for those impacted by AB 5. Labor unions are mentioned frequently, but there will be other entities representing drivers and other workers affected by AB 5. New groups are being organized to represent independent contractors under the new law, but there are a few experienced law firms that have been representing gig economy workers in recent years.

One likely scenario is that the first version of collective bargaining will start with lawyers filing for labor arbitration hearings and class-action lawsuits in California courts. Attorney Shannon Liss-Riordan is well known for filing for arbitration, and class-action suits, against Uber and other mobility companies, seeking fair pay for drivers and classifying them as employees. There are several other large law firms in California that have negotiated settlements for independent contractors working for Uber, Lyft, DoorDash, Postmates, and other gig economy firms.

The first suit has already been filed — on Wednesday afternoon when an Antioch, Calif.-based Uber driver filed a proposed class-action case against Uber Technologies, Inc., for misclassifying her and other California drivers as independent contractors rather than employees. Filed in the US District Court for the Northern District of California, the case cites AB 5.

Where did all of it start?

A 2005 lawsuit in California paved the way for AB 5. In 2018, the California Supreme Court ruled in favor of workers in the case Dynamex Operations West v. Superior Court. Dynamex is a nationwide same-day courier and delivery service that offers on-demand pickup and delivery services. Prior to 2004, Dynamex classified its California drivers as employees. Starting in 2004, the company converted all of its drivers to independent contractors as a cost savings measure.

The 2018 ruling essentially created the “ABC test” as precedent, but it only relates to workers seeking minimum wages and overtime pay. Under the test, a worker is only an independent contractor if they meet all three parts:

> The worker is free from the control and direction of the company in relation to the performance of the work, both under the contract and in fact;

> The worker performs work that is outside the usual course of the hirer’s business;

> The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hirer.

Another way of saying it is that if the worker is performing a task that’s central to the company’s functioning, and if their wages are set by the company, they’re more likely to be considered employees.

What do Uber and Lyft think?

Uber and Lyft are dismissing AB 5, and say it will remain business as usual on how drivers are paid. They know that many pleas will be made to reclassify drivers, but they say they’ll be able to pass the new test and their drivers will remain independent contractors. But they and several other mobile app companies fought hard against the bill passing.

Fares will have to go up to cover these additional costs for these two publicly traded companies that have struggled to become profitable. One analyst estimates that 25 percent fare increases in California will be a necessity. That will take some of the edge away from competing with taxis, livery companies, limousine operators, shuttle services, and other transportation providers. But it will still be much lower, with Uber and Lyft typically described as being half the cost of other transportation modes.

Uber, Lyft, and DoorDash have all contributed $30 million each into a fund for a 2020 California ballot proposal that would counteract AB 5. The proposal hasn’t been written yet, and it’s expected to include some concessions to labor such as a guaranteed wage floor if drivers aren’t classified as employees.

What do drivers think?

Uber and Lyft drivers have had their share of work stoppages and public protests calling for fair pay, and sometimes for reclassification as employees. A lot of drivers, however, would like things to stay the same. They may not be making the kind of income they need long term, but they do appreciate the opportunity to quickly bring in decent earnings under flexible conditions.

Unlike other on-demand jobs that require scheduling, Uber and Lyft drivers can set their own hours. They can sign in and out of the app at will to take care of personal business and get some time off to relax and have a meal. Other mobile apps offer some flexibility, and drivers are allowed to set their own weekly schedules during a set time, on a first-come, first-served model.

Yet no matter how often the argument is made about freedom over strict work hours, drivers are feeling the squeeze. They’re typically given generous incentives for joining the networks, getting five-star customer ratings, bringing in their friends as drivers, and working long hours. But that eventually fades away when per trip earnings are cut back as the companies cite pressure to reduce their costs. Drivers have to find the best, peak demand hours to work where they will get rides and deliveries, and earn decent pay. They also face the ominous threat of being “deactivated,” which would mean being fired if they were employees, without warning.

The inconsistency in the work and pay can be very frustrating. There’s nothing worse than scheduling a block of hours, and then to sit there looking at your smartphone for long periods wondering when the trips will begin. Near the end of the shift, downtime could be dragging on when suddenly another ride or order is offered to you that will take an extra hour after the end time to fulfill, and may conflict with personal plans. 

Drivers do value the flexibility in meeting their goals, but the advantage always goes to drivers willing to work long hours. The new law could push Uber and Lyft to give preference to the workers who can and do work full-time hours in California, says Robert Maxim, a research associate for the Brookings Institute’s Metropolitan Policy Program.

Which labor unions could be representing these workers?

This is a gray area, as most drivers in passenger trips and freight hauling don’t have union membership. Labor unions have progressively lost membership since the 1980s, and are taking on battles as much as they can such as the UAW announcing a nationwide strike after negotiations with GM stalled. Here are a few unions that could be involved in representing California workers under AB 5………..

> Teamsters has 1.3 million members, representing heavy-duty truck freight hauler drivers and over 200,000 UPS drivers. Independent truck drivers may want to join up with them.

> Service Employees International Union (SEIU) disputed reports of a backroom deal made with Uber and Lyft executives, saying that the union supports AB 5 and full employee status for drivers. SEIU is known for its 1.9 million members in hospitals, home care, and nursing homes; public services (such as city and county workers); and property services (janitors and cleaners). With AB 5 addressing janitors and cleaners, SEIU will likely be involved in contract negotiations for these workers.

> Transport Workers Union of America represents more than 150,000 members across the airline, railroad, transit, universities, utilities, and services sectors. They’re not likely to be involved and see most of their membership on the east coast.

As mentioned earlier, new entities such as Gig Workers Rising are being created to take advantage of the opportunity to collectively organize for independent contractors.

A few interesting news briefs:

  • Yemen’s Iranian-backed Houthi rebels hit major Saudi Arabian oil installations during a drone airstrike early Saturday. The Khurais oilfield operated by Saudi Aramco, the state-owned oil giant, and the Abqaiq oil processing facility, were struck by a number of drones that caused fires at the plants. Saudi Arabia shut down half its oil production Saturday, which is expected to impact almost 5.7 million barrels of crude production a day, about 5% of the world’s daily oil production; and up to 70 percent of the country’s crude output. The government said the attacks also led to a halt in gas production that will reduce the supply of ethane and natural gas liquids by 50 percent. Saudi Aramco CEO Amin Nasser said nobody was hurt in the attacks and emergency crews contained the fires. Secretary of State Mike Pompeo blamed Iran for ordering the attack, in tweets on Saturday, while Iran said it had nothing to do with the bombing. President Donald Trump later tweeted that the US has “reason to believe that we know” who is responsible for the attack and the country is “locked and loaded depending on verification.” Houthi rebels in Yemen have claimed responsibility for the attacks, and said 10 drones had targeted the oil installations; reports are coming out that the attack may also have been caused by cruise missiles. The US secretary of state and presidents’ remarks came amid rising tensions between Washington and Tehran after President Trump’s decision last year to pull the U.S. out of the Iran nuclear deal.
  • The Frankfurt Motor Show continues to showcase electric vehicle launches as European automakers invest tens of billions into their new lineups to comply with stricter emissions rules and expected growing demand. Volkswagen, Porsche and Mercedes-Benz unveiled electric models that will be heading to dealerships soon. VW’s ID.3, the first model from its new MEB product line, and Porsche’s high-performance Taycan electric sports car, grabbed much of the attention. Pressure is mounting on automakers to go green. On Saturday, thousands of protesters marched in front of the car show to demand a swift end to internal combustion engines and a shift to clean vehicles.
  • For fans of the HBO series, “Game of Thrones,” Henrik Fisker is in a good position to showcase his upcoming all-electric SUV. Nikolaj Coster-Waldau, who played Jaime Lannister on the recently completed popular TV series, has been a United Nations Goodwill Ambassador for climate change and other social issues. Now he’ll be serving as a partner and sustainability adviser to Fisker Inc. chairman and CEO Fisker in working toward a future with advanced, affordable, electric mobility. It will be a good fit in helping the UN meet as many sustainability goals as possible, the company said. Fisker Inc. will unveil its electric SUV at the end of this year. The company said it will offer a range of approximately 275 to 300 miles per charge.
    German auto supplier Bosch said it has earned about 13 billion euros ($14.5 billion) since the beginning of 2018 through “electromobility” orders. That product lineup includes software, production projects for electrical powertrains, automated valet parking, and other projects focused on making mobility more automated, connected, and personallzed.
  • Volvo Group North America became the first trucking OEM to join the US Department of Energy’s Better Plant Supply Chain Initiative. The company recruited eight Volvo Group vendors to commit to reducing energy consumption by 25 percent over 10 years. The federal agency said that 85 percent of US energy consumption is a result of the industrial supply chain, a majority of which is comprised of small- to medium-sized manufacturing companies.

Forecast on where global car sales are going over next decade, Ugly signs we’ve crossed the line on climate change

Expectations have been in place that the next decade will be as historically significant as the birth of mass production automobiles — when Henry Ford’s company put the first Model T in production in 1908 and watched it reach the 15 millionth unit 19 years later. But will the 2020s be likely to see these historic shifts fall in place, with the year 2030 typically used in forecasts and emissions reduction goals as the benchmark for adoption? That benchmark could include steadily declining new vehicles sales; electric vehicles becoming more important to automakers and vehicle owners than cars and trucks powered by internal combustion engines; autonomous vehicles clearing regulatory hurdles and starting production; mobility services leading the way in traffic- and smog-congested cities; and younger consumers choosing autonomous, electric, shared ride services over owning their own personal vehicles.

Good questions. Let’s take a look at the first one………
Auto sales forecast: New vehicle sales increased in June in China, the world’s largest auto market, but that came during a 14 month period where 13 of them were in decline. July saw the decline fall back into place. Rising trade tensions and tariffs, a slowdown in China’s booming economy, and implementation of stricter emissions rules, have had their impact. Much of the the June sales boom was fueled by dealers cutting prices way down to clear inventory and prepare for exhaust controls coming to new vehicles. LMC Automotive estimates 2019 will see a second straight annual drop in China. India has seen sales decline at an alarming rate this year, with automakers cutting production and putting plans on hold to increase capacity. Analysts worry that U.S. auto sales reached their historic peak and will continue to see decline this year. Germany’s Center for Automotive Research says that the global auto market is about to take its biggest hit since the financial crisis of 2008, with sales declining by more than four million units at the end of this year.

There are concerns over a global economic slowdown potentially dragging out the current sales decline, yet global sales growth is far from being over. Studies by McKinsey, IHS Markit, Bank of America and Merrill Lynch, and AutoForecast Solutions, predict a return to growth in new vehicle sales worldwide. Should these studies be taken seriously? Yes, as they do tap into auto executive interviews on their product pipelines in the coming years, and opinions expressed by shareholders.

A McKinsey report forecasts global new vehicle sales will return to an increase, but not at the steep rate we’d seen over the past five years. That was at 3.6 percent per year, and it should decline and level out around 2 percent annual growth rate by 2030. Consumers are buying a lot of new vehicles, many times for the first time ever. China, India, Brazil, and a few other countries with emerging economies, are expected to see economic growth return with consumers moving to growing metro regions with strong job demand and more need for transportation beyond metro trains and buses.

The McKinsey study expects that the decline and leveling out will come from macroeconomic factors and the rise of new mobility services such as ride hailing, car sharing, and eventually by automated shared rides.

“New mobility services may result in a decline of private vehicle sales, but this decline is likely to be partially offset by increased sales in shared vehicles that need to be replaced more often due to higher utilization and related wear and tear. The remaining driver of growth in global car sales is the overall positive macroeconomic development, including the rise of the global consumer middle class. As established markets are no longer expanding, growth will continue to rely on emerging economies, particularly China and India,” according to the McKinsey study.

These findings have been echoed in other market reports, with many including electric vehicles in the numbers. A dominant topic of conversation among industry panelists last month at the 54th annual CAR Management Briefing Seminars in Michigan, was the speed in which key markets around the world will adopt EVs and increasing levels of autonomous mobility. Cybersecurity was another key concern, with fear of hackers being able to take over vehicles and shut down the grid, being reiterated by speakers.

AutoForecast Solutions and IHS Markit released studies forecasting overall new vehicle sales growth to continue through at least 2026. Electric vehicles are supposed to replace internal combustion engines in large numbers by 2030, but IHS Markit sees that taking much longer — reaching only 7.6 percent of the total by 2025. Another previous forecast has been set aside, with the young Millennial generation actually buying cars like their parents did and keeping them longer.

Global plug-in vehicle deliveries reached 2.1 million units for 2018, 64 percent higher than for 2017 and 2.4 percent of the world’s overall 86 million units sold last year. The International Energy Agency’s New Policies Scenario expects that by 2030, global EV sales will reach 23 million for that year and the stock of owned EVs will exceed 130 million vehicles (excluding two and three-wheelers). That’s under one forecast analysis including the impact of announced policy ambitions by several governments; the IEA scenario includes another potential outcome where the number shoots up to 43 million and the stock coming to more than 250 million. Either predicted scenario would cut oil demand substantially.

China saw its first drop in recorded EV sales in July. Monthly global sales fell 14 percent with declines in China and North America during that month. Reductions in EV subsidies and a cooling economy impacted the China market. Another top auto market, India, is struggling to get consumers and rickshaw drivers to convert over to EVs and meet goals the government had laid out.

For now (and in another study), the IEA sees oil being king and the US playing a leading role over the next six years. That comes form rapid growth in the shale industry. By 2024, the US will export more oil than Russia and will come close to Saudi Arabia’s exports.

Other advanced fuels, such as renewable natural gas, will offset the advantages stable fuel prices offer petroleum suppliers when it comes to fleets. Affordable gasoline and diesel, and concern over incentives diminishing, are expected to keep EV sales at bay in the US for now with fleets and consumers. Traditional ICE vehicles with good fuel economy, strong crash safety ratings, and a full spectrum of features and connectivity, are leading the way for now. As for new vehicle purchases, it appears that major markets won’t see their numbers go way down over the next decade. It will take longer before alternative modes and energies will be fundamentally and historically altering the industry.

Signs that we’ve crossed the tipping point with climate change:  New fires are continuing to start up in the Amazon rain forest, caused by famers, cattle ranchers and other sources. The world’s largest absorber of greenhouse gases may change roles and begin emitting them, according to scientists. There are other indicators of environmental hazards approaching: Australia’s Great Barrier Reef may be seeing the end of its days….. More than 1 in 10 Americans — 34 million people — are living in rapidly heating regions. Seventy-one counties have already hit the benchmark 2-degree Celsius mark………. The Intergovernmental Panel on Climate Change predicts a further rise of between 1.4°C and 5.8°C by the end of the century in oceans. It would take out many species which are already under stress from overfishing and habitat loss; and the oceans are becoming increasingly acidic…… Scientists recently announced that July equaled, if not surpassed, the hottest month in recorded history. The heat wave that wreaked havoc on Europe in late July has now reached Greenland, causing the ice in the region to melt at a rapid pace.

A few interesting news briefs:

  • On Friday, China’s Ministry of Industry and Information Technology, announced Tesla is receiving an exemption from a 10-percent purchase tax. It’s part of a broad national policy applying to domestic electric vehicles. Prior to that on August 20, Tesla was included in Shanghai’s Pilot Free Trade Zone, which will also help the EV maker gain a financial advantage in the world’s largest EV market.
  • Chinese automaker BYD took third place (behind Qualcomm and MasterCard) on Fortune Magazine’s “Change the World” list 2019, which is the American publication’s annual ranking of companies that are hitting targets to help the planet and tackle society’s unmet needs. BYD’s cited achievements include building a flexible “e-platform” for EV design and construction, competitive pricing that’s helped further commercialize EVs, and the recent deal to jointly develop electric vehicles with Japan’s Toyota that should expand BYD’s global reach.
  • The 2019 Hyundai Nexo hydrogen fuel cell electric SUV has earned a TOP SAFETY PICK+ award from the Insurance Institute for Highway Safety (IIHS) for vehicles built after June 2019. The Nexo, which is only available in California, is the first such hydrogen fuel cell vehicle that IIHS has tested for crash safety.
  • The Ford Police Interceptor Utility 2020 model is now the first-ever pursuit-rated police utility vehicle with a standard hybrid engine. Agencies in cities such as San Diego, Columbus, Ohio, and Madison, Wisc., have committed to adding hybrids to their law enforcement fleets. So far, these agencies have ordered more than 2,600 units equipped with the standard 3.3-liter hybrid engine.
  • Car sharing service Share Now, which was created this year as part of a joint venture between BMW and Daimler, will expand its electric fleet significantly under the agreement with the City of Munich. A total of 200 BMW i3s will be available to Share Now customers on Munich roads by the end of the year.
  • From GAM editor’s blog post, called The mysterious vanishing of Americans 40 to 60 — and why we were named Generation X: “The next time you go out and about, take a 365-degree look around you. Millennials (ages 23 to 38 during this year) and GenZers (ages 7 to 22) are out doing things in vast numbers, with Millennials nearly as big in population as Baby Boomers — and GenZers following right behind. But what’s happening to my peers in Generation X? We’re there, but in smaller numbers; and many of us are somewhere else — such as working long hours.”

Tesla says goodbye to innovative CTO Straubel, BYD and Toyota partnering to bring EVs to China

Tesla losing Straubel:  Tesla, Inc., has taken a big loss with the departure of one of its founders, chief technology officer JB Straubel. At the beginning of Wednesday’s quarterly report, CEO Elon Musk made the stunning announcement along with news on the delivery of 95,356 electric vehicles during the past quarter. Straubel is credited with playing a pivotal role in the development of Tesla’s power systems and battery technology. The photo you see is of Straubel from 2004 in his backyard gluing lithium ion batteries to a case as part of the company’s first concept vehicle. Retiring at age 43, Straubel was still in his twenties when he became convinced that new and innovative li-ion batteries could become the power source for mass produced EVs. Straubel met Musk in 2003, when they had lunch in Los Angeles near the headquarters of Musk’s other passion in life — his rocket company, Space Exploration Technologies Corp. (SpaceX). Two other entrepreneurs, Martin Eberhard and Marc Tarpenning, were in on the early days of the company, working with Straubel and Musk to launch the company. Eberhard and Tarpenning left Tesla in 2008, as disputes came up over the future of the company — and as Musk exerted more control.

Straubel brought a much needed calm and balance to Musk’s approach to running the company, which includes Musk making extreme demands of the company’s corporate leadership and workforce. He was known for providing insight and clarity to the technical points that could come up with shareholders and Tesla engineers. His role as a problem-solving engineer has come through as the company has had to overcome several obstacles. He’s been known for being much more easygoing and approachable than the CEO — and that’s included participating at Tesla vehicle rides and demos. He’s also become known as a leading innovator in EV batteries, energy storage, and propulsion. It’s now his time to move on. “It has been a really tough decision because I feel like I’m letting a lot of people down,” Straubel said. “But, also, you have to live life. I love inventing and creating and building things and am at peace knowing that about myself and wanting to reorient my life. I’m decompressing for a bit and having a little break, but I will have more to say in a few weeks.”

Four automakers backing California standards, Colorado makes deal on ZEVs:  Ford, BMW, Honda, and Volkswagen, signed a deal Thursday with the California Air Resources Board to comply with the state’s clean air admissions standards. They’re now siding with California’s mandate to produce fleets averaging around 51 miles per gallon by 2026, one year after the Obama-era target. This precedes an expected announcement later this summer from the Trump administration on a rollback of existing fuel economy and emissions standard targets, and taking away California’s right to set more stringent rules under the Clean Air Act (i.e., one national standard) to avoid what a Trump spokesman called a “PR stunt.” California’s Governor Gavin Newsom spoke to reporters on reducing greenhouse gas emissions, with vehicle emissions being “perhaps the most significant thing this state can do, and this nation can do, to advance those goals. The Trump administration is hellbent on rolling them back. They are in complete denialism about climate change.”

In related news, automaker trade groups representing 99 percent of U.S. car and truck sales made an agreement with the state of Colorado to join the California zero emission vehicle program starting in the 2023 model year. The state agreed to allow automakers to earn credits for selling electric vehicles in the two model years prior and use other transitional credits available in other states. The Colorado agreement must be approved by the state’s Air Quality Control Commission at a meeting set for later this month. The automaker trade groups issued a statement praising the state’s flexibility in addressing their concerns “by providing the support Coloradans need to buy electric vehicles while allowing auto manufacturers to transition into Colorado’s ZEV program.”

Comeback for diesel engines:  The 2020 Chevrolet Silverado 1500 won the ranking as the most fuel-efficient light-duty truck on the market. General Motors’ pickup achieves an EPA-estimated 33 mpg on the highway and 23 mpg in the city when equipped with the new 3-liter inline six-cylinder Duramax diesel engine and rear-wheel drive. Its the first diesel engine offered in a Chevy light-duty truck since 1997. Light-to-heavy-duty pickups trucks have been a saving point for diesel engines since the September 2015 collapse following Volkswagen’s confession that the company had been dishonest about emissions reporting in its “clean diesel” passenger cars. Now GM will be following market leader Ford on the diesel pickup side, with Ford leading from sales of 94,626 diesel light and heavy-duty pickup trucks during the first half of this year.

Will 5G networks make it?:  One significant area to follow is how the new 5G wireless networks are facing an uphill battle for becoming the industry norm. The stakes are huge, with 5G ready to help save thousands of lives in self-driving cars, along with reducing traffic congestion and emissions. Europe is trying out auctioning off its bandwidth spectrum to monetize the new technology, a very expensive prospect for wireless carriers and partners. Check out this commentary by Roger C. Lanctot, a Strategy Analytics executive, on the challenges BMW and its German partner Deutsche Telekom have in building a consistent and reliable network of 5G wireless connectivity in the market. It’s a challenge faced in the U.S. and other key global markets adopting 5G. “We don’t need 10 Mbit/s, but rather basic bandwidth and guaranteed latency. We need coverage,” said BMW senior VP of electronics Christoph Grote at the recent Automobil-Elektronik Kongress in Ludwigsburg, Germany.

China partnership:  BYD and Toyota announced on July 19 in Toyota City, Japan, that they have signed an agreement for the joint development of battery electric vehicles, which will be electric sedans and sport-utility vehicles. The two parties will jointly develop sedans and low-floor SUVs as well as the onboard batteries for these vehicles and others. They’ll be launched in the Chinese market under the Toyota brand at some point in the first half of the 2020s. This joint venture partnership will help resolve Toyota’s ambitions to use electric vehicles to break into China, the market where the company remains well behind other global automakers. It also ties into climate change strategies as both BYD and Toyota seek to reduce carbon emissions by promoting the widespread use of BEVs.

Plug-in vehicle sales beating overall market, Tesla quarterly numbers exceed expectations

EV sales beat overall market:  Plug-in vehicles had a strong increase in the first half of the year, while U.S. and global total new vehicle sales stalled out. InsideEVs reports that 148,704 plug-in vehicles were sold in the U.S. during the first half of 2019, compared to 124,256 for first half of 2019. That makes for an increase of 19.67 percent over that same period last year of plug-in hybrid and battery electric vehicles. Through May, there were 840,814 in global plug-in vehicle sales, versus 591,796 for the first five months of 2018 — an increase of 42 percent over that same period last year.

As for overall new vehicle sales in the U.S., sales were down 2.4 percent halfway through 2019, and is expected to be at 16.9 million by the end of the year; that would be the first time total light-duty new vehicle sales would be below 17 million since 2014. Global new vehicle sales are expected tom come in at 78.7 million units, which is about the same level as 2017 and 2018. The global market had seen a leap in 2016 over the previous years. Sales are still considered to be strong this year; rising auto loans have hurt demand. However, some analysts believe that new vehicle sales will be declining in the U.S., and eventually other markets, as car ownership drops in importance and alternative forms of mobility become more popular.

The Tesla Model 3 continues to dominate U.S. market with 21,225 units sold in June versus No. 2 on the list, the Tesla Model X, which sold 2,725 units during that month. Battery electric vehicles are still dominating the U.S. market. For May 2019 sales, Electric Drive Transportation Association reported there were 21,248 BEVs sold, 7,138 plug-in hybrids, and 283 hydrogen fuel cell vehicles.

Tesla performance up:  Tesla’s stock went up 7 percent Tuesday after reporting it produced 87,048 vehicles in the second quarter while delivering 95,200, strong performance that exceeded analyst forecasts. The company manufactured 17,650 Model S and X vehicles and 77,550 Model 3s. Among deliveries, 77,550 were Model 3s while the other 17,650 were Models S and X. Right before the quarterly report, CEO Elon Musk was on Twitter promoting Tesla Direct, a new service that offers some buyers of the Model 3, S and X the option to have their car dropped off at their home or office. It’s gaining a lot of interest and support, and some considering it an element of Tesla focusing on its strengths — quality EVs and a high level of customer service.

Cruise gains SoftBank investment:  Cruise Automation, a U.S. self-driving vehicle company majority-owned by General Motors Co. (and operating under the name GM Cruise), announced Friday that a U.S. national security panel approved a $2.25 billion investment in the firm by Japan’s SoftBank Corp. SoftBank has come under increasing U.S. scrutiny over its ties to Chinese firms in the face of an escalating trade and technology war between those two countries. It comes out of SoftBank’s $100 billion Vision Fund investment pool.

VW’s Paris Accord strategy:  Volkswagen has released more information on its commitment made earlier this year to commit itself to the goals of the Paris Agreement. The commitment to carbon neutrality comes in three parts: reducing carbon dioxide emitted from vehicles and factories; adopting renewable energy sources, whether at the plant level for Volkswagen and its suppliers, or encouraging their use for Volkswagen owners; and using carbon offsets to tackle those remaining carbon emissions that can’t be further reduced. One key element of hitting its target by 2050 will be making its vehicles and production carbon neutral. That includes Volkswagen vehicles sold in the US and the factory in Chattanooga, powered by a planned Group-wide investment in EVs sold worldwide – more than $50 billion over the next four years, with approximately $10 billion from the VW brand alone.

Sharing MEB platform:  Ford and Volkswagen have reached an initial agreement to share electric and autonomous vehicle technologies, extending their alliance beyond working together on commercial vehicles, a source familiar with the matter said. VW will share its MEB electric vehicle platform with Ford, the source said. VW’s supervisory board is due to discuss deepening the alliance at a meeting on July 11, 2019, a second source told Reuters.

Toyota rolling out new EV lineup, Renault refreshes ZEO

Toyota EV lineup based on new platform:  Toyota is working hard at shedding its image as a major automaker lagging way behind on electric vehicles. The company has unveiled six new battery electric vehicle concepts it will roll out before 2025.
The new electric vehicles, with the working name of EV-e, will have long wheelbases, plenty of interior space, camera mirrors, and ventilated front corners with automated driving sensors. The company is showing off life-sized clay concepts to tell the story. They represent a lineup that Toyota designers have been working on since 2016, based on the Toyota New Global Architecture (e-TNGA) modular platform
It ties into a previously announced larger goal of bringing more than 10 EVs to the market by the early 2020s. One of these, the electric C-HR subcompact crossover, will come out next year and will be based on the existing nameplate; and there will be other electric versions of its lineup.
Toyota expects demand for EVs to go way beyond cars and sedans. The e-TNGA platform will potentially house EVs that could include a three-row SUV, a sports car, and a small crossover.

Fuel cell vehicles getting ready to take off in China:  The man credited with bringing electric vehicles to China is now focusing on hydrogen fuel-cell vehicles.
China’s science and technology minister, Wan Gang, a former Audi executive, will be continuing the country’s subsidy program for hydrogen-powered vehicles as EVs see incentives wane and phase out next year. He’ll be leading the Chinese government committing resources to developing fuel-cell vehicles.
“We should look into establishing a hydrogen society,” said Wan, who’s now a vice chairman of China’s national advisory body for policy making, a role that ranks higher than minister. “We need to move further toward fuel cells.”
Shares of some hydrogen-related companies rose after Wan’s interview was published on June 9. Wan has a lot of influence on the market, being credited with leading China into becoming the dominant EV market in the world with half of its sales.
Wan sees electric cars dominating inner-city traffic in the near future, while hydrogen-powered buses and trucks could become commonplace on highways for long-distance travel.
He understands that fuel-cell vehicles have quite a long way to go with only about 1,500 of them on Chinese roads, versus more than 2 million battery electric vehicles. He’s championed three selling points that will carry over to hydrogen-powered vehicles: boosting economic growth, tackling China’s dependence on oil imports, and its mounting levels of air pollution.
He dismisses the list of roadblocks that typically come up over fuel-cell vehicles going mass market.
“We will sort out the factors that have been hindering the development of fuel-cell vehicles,” Wan said.
It’s no secret that the 66-year-old began his return to China by studying and researching the fuel cell industry himself—he developed three FCVs under a series called Chao Yue (meaning “to surpass”) during his time from 2003 and 2005 (link in Chinese) as chief scientist for China’s 863 Program.
Toyota Motor Corp. will supply its fuel cell vehicle technology to major Chinese automaker Beijing Automotive Group Co. (BAIC) as it seeks to expand business in the world’s largest auto market. BAIC’s commercial vehicle division will manufacture buses powered by Toyota’s fuel cell system. The production of the buses may increase toward the 2022 Winter Olympics to be held in Beijing.

News Briefs:
New Zoe:  Renault’s deal with Fiat Chrysler Automobiles appears to be over for now, and life goes on. The French company just unveiled a refreshed version of this popular Zoe small electric car. The company says it will be getting 242 miles per charge based on the new WLTP conditions.WLTP was released nearly two years ago by a United Nations working group to resolve criticism of the previous NEDC standard. It’s goal is to provide uniform and more realistic test conditions worldwide. Extra power and range will come from a 52 kWh battery, and a powerful 100kW electric motor. It also has a restyled exterior and new colors.

Volvo working with NVIDIA:  The Volvo Group has signed an agreement with NVIDIA to jointly develop the decision making system of autonomous commercial vehicles and machines. The two companies want to bring autonomous trucking and freight hauling to highways built on NVIDIA’s full software stack for sensor processing, perception, map localization and path planning It could serve a wide client base in freight transport, refuse and recycling collection, public transport, construction, mining, forestry, and more. Separately, Volvo is tasing out what it’s named Vera, an electric, autonomous truck being tested moving goods from a logistics center to a port terminal in Gothenburg, Sweden. It’s part of a new collaboration between Volvo Trucks and the ferry and logistics company, DFDS.

EVs at Disneyland:  Anaheim Resort Transportation (ART) will be bringing 40 BYD all-electric buses to its fleet serving Disneyland. Visitors to California’s most popular theme park can manage admission tickets, public and private transportation all in one app. ART’s new app RideART combines everything necessary for a seamless trip to Disneyland’s Star Wars: Galaxy’s Edge.

Volvo and Uber:  Volvo Cars and Uber are jointly developing production-level autonomous vehicles, the next step in their strategic collaboration that started in 2016. For now, the Volvo XC90 SUV that was just displayed is the first Volvo production car that in combination with Uber’s AV system is capable of fully driving itself. The XC90 base vehicle is equipped with key safety features that allow Uber to easily install its own self-driving system, enabling the possible future deployment of self-driving cars in Uber’s network for shared rides.

It ain’t over till it’s over:  CEO Elon Musk and his company have been hit hard in the past year on several fronts, but new vehicle sales is offsetting some of that damage. Edmunds.com estimated that Tesla’s May sales were up 71 percent from the same month last year, which is much higher than any other automaker selling any kind of vehicle in the U.S. market. It was the central theme at Tesla’s annual shareholder meeting on Tuesday. Scrutiny has been pervasive recently about a poor quarterly earnings report and battery fires in Teslas. Some car shoppers aren’t happy with window sticker prices, but long-term, it’s not really an issue, the CEO said. “I want to be clear: there is not a demand problem,” Musk said at the beginning of his presentation. “Absolutely not.”