What to watch for in 2020, Changes in GAM email distribution list

Here are 10 trends and developments that are bound to have a big impact on clean transportation and other sectors — including the presidential election, European emissions rules, and what’s next for car sharing and autonomous vehicles.

1. No continuation of federal EV tax credit
The federal tax credit for purchasers of electric vehicles is ending for automakers selling the highest volumes and hitting their caps on allowable sales — and it appears that won’t be extended. The cap is at 200,000 units sold by brand of battery electric vehicles with a $7,500 tax credit. Tesla and General Motors have already passed that mark, and just had their pleas for extension ignored by the Trump administration and Congress in the new federal budget. Nissan will be next in line, followed by Ford and BMW. Automakers and EV advocates will need to turn to state incentives. The Top five sales states in EV sales during 2018 — California (about 45 percent of total), New York, Washington, Florida, and Texas — have their own state incentives that will have to be tapped into more.

2. Trump campaign clear about environmental and energy issues
The Trump administration continues to campaign for 2020 re-election, regardless of the president’s impeachment. The odds are that the US Senate, with its Republican majority, will not vote to remove Donald Trump from office — making him the third US president after Andrew Johnson and Bill Clinton to be impeached by the House but failing to reach the two thirds (67 votes) needed to be removed from office. Trump says he’s ready to continue on as president, and the Democrats are continuing to wend their way through candidates. For now, Joe Biden is the leading candidate, according to polls taken of regular voters.

As for the policies, Democratic candidates aren’t mentioning specific issues like the EV tax credit or incentives for fleets to acquire alternative fuel vehicles. As for taxing carbon emissions to get businesses to reduce their greenhouse gas emissions, Joe Biden, Pete Buttigieg, Julian Castro, John Delaney, and Andrew Yang, support it. On extending a cap-and-trade program such as the one started years ago in California, only Tom Steyer is endorsing it for now. As for the Trump campaign, you can review the campaign website and see that the administration will continue it’s crusade to gut environmental regulations, softening fuel economy and emissions rules, and denying climate change exists — statements that can be validated and detailed by environmental groups. Here are a few of the Trump 2020 campaign website statements………

“President Trump and his administration acted aggressively to increase exports of energy resources to the global market. This allowed financing for coal and fossil energy projects………. President Trump has approved the infrastructure and provided the resources needed to unleash oil and gas production in the US……… The Trump administration reversed President Obama’s moratorium on new leases for oil and gas development on federal lands………. President Trump rescinded President Obama’s costly Clean Power Plan and instead has proposed the Affordable Clean Energy Rule……… The EPA has rescinded President Obama’s methane emissions rule that would cost American energy developers an estimated $530 million annually……… 
The EPA is reviewing a rule that if rescinded would relax costly fuel standards and save $340 billion in regulatory costs……… President Trump announced his intent to withdraw the US from the unfair Paris Climate Agreement.”

3. Long-anticipated emission rules starting in Europe
Light-duty vehicle manufacturers will see more stringent emissions standards take effect in Europe in the new year with a phase-in period extending into 2021. Automakers will have to sell a lot more hybrid and electric vehicles in European Union member countries or they’ll pay costly fines, a situation similar to China. Scientists say that about 20 percent of Europe’s carbon dioxide and greenhouse gases come from light-duty vehicles, and heavy-duty trucks add to that emissions share even more. Shareholders worry that profit will be hurt as these green cars can’t be sold at higher prices than conventional gasoline and diesel models, which means they won’t be profitable until battery costs come down. The regulations will eventually cover heavy-duty trucks, albeit with a longer timeline. In Europe, commercial trucks will have to emit 30% less greenhouse gases by 2030. The US will have to continue to wait and see how the Trump administration is ruling on light-duty vehicles and later on medium- and heavy-duty vehicles — though it certainly will be at a less strict standard.

4. Going from NAFTA to USMCA
The House of Representatives voted Dec. 19 in favor of a new trade deal replacing NAFTA. The new United States-Mexico-Canada Agreement (USMCA) was passed by an overwhelming bipartisan vote of 385 to 41, with a large majority of Democrats approving the deal — a day after House Democrats voted to impeach the president. The Senate plans to ratify USMCA next year, potentially after it holds a January trial on whether to remove Trump from office. According to the new USMCA rules, 75 percent of car or auto parts need to have originated in a country partnership. Under NAFTA’s rules, the floor was 62.5 percent. Additionally, 70 percent of a car’s steel and aluminum purchases must be made in North America.

The new rules also require that a certain percentage of vehicles imported duty-free must be made in a place where employees make an average of $16 per hour. But the critical question remains to be seen — if the new agreement will force enough changes to shift production of vehicles from Mexico to the US. While the U.S would likely replace some of its duty-free imports with its own production, it will still need to rely on more expensive imports. It will cost automakers nearly $3 billion over the next ten years, according to budget projections made by the Congressional Budget Office. And it won’t face the reality of globalization of automotive manufacturing and distribution, and that new vehicles sold in the US already display a mix of foreign-made parts and components. As for now, General Motors and Ford support the new USMCA rules, as does the American Automotive Policy Council, which lobbies for Ford, GM and Fiat Chrysler. Labor unions had been pushing for the bill, too, to protect domestic workers.

5. Tesla bucking downward sales slump in China
While new vehicle sales in China — including electric vehicles — continued to see a downward slide in November, Tesla broke that cycle with a 14-fold gain in new-vehicle registrations. Registrations of Tesla vehicles climbed to a five-month high of 5,597 in November, compared with 393 vehicles sold a year earlier. The China-built Model 3s are set to start at about $50,000, slightly cheaper than imported versions. Tesla thinks it can lower that price by 20 percent or more next year as it starts using local components and parts, reducing costs. There’s much at stake for Tesla as China accounts for about half of the world’s electric-vehicle sales — and with the company seeing the country becoming its largest global market after the US. The electric carmaker needs to see another burgeoning market as EV tax incentives will be going away soon in the US for Tesla and other makers.

6. New EVs that are gaining the most interest
In recent weeks following the LA Auto Show and announcements on 2020 product offerings, a few electric vehicle models have been getting much of the attention. One interesting question is will Tesla’s new Cybertruck will cannibalize sales of the upcoming Tesla Model Y crossover SUV………. Electric truck maker Rivian has raised $1.3 billion for the R1T pickup in a new financing round led by T. Rowe Price. Prior investors including Amazon, Ford, and BlackRock participated in the deal. Amazon, of course, will be buying a lot of the trucks………… Ford’s Mustang Mach-E electric SUV was very hot at the LA Auto Show. It will start arriving in late 2020, and Ford will only make 50,000 units globally in the first model year……….. The 2022 Fisker Ocean crossover SUV can be secured with a $250 down payment. It will offer 250 to 300 miles of range and will feature recycled materials from the ocean……… Volvo and its Polestar subsidiary will only be sending out its Polestar 2 electric car to select dealers in the network. It’s so popular that dealers in Illinois are fighting the Polestar Automotive USA’s plans to limit the dealer distributions…………. Watch for battery- and hydrogen-powered commercial trucks and buses to make a splash in 2020.

7. The latest in autonomous vehicle regulations
Autonomous, light-duty trucks can now be used for commercial purposes on public roads in California. The state’s Department of Motor Vehicles announced the proposal this month, which outlines a permitting process for companies wishing to test or deploy driverless trucks for commercial use. The new rule only applies to autonomous vehicles weighing less than 10,001 pounds — Class 1 and 2 trucks that would include minivans, pickup trucks, utility vans, and step vans. This would be ideal for delivery companies………. At the moment, all autonomous vehicles undergoing testing must have a few controls in place, those being steering wheels and backup drivers. General Motors wants to roll out a small fleet of autonomous vehicles that don’t have these two things. The National Highway Traffic Safety Administration says it will have a decision soon on the automaker’s request.

8. Will female CEOs carry over to automakers?
Enterprise Holdings announced earlier this month chief operating officer Chrissy Taylor would take on the role of chief executive in a planned succession. Taylor, the granddaughter of company founder Jack Taylor, will take the wheel on January 1. She’ll replace Pam Nicholson, the No. 23 person on the Fortune Most Powerful Women in business list who had served as CEO of the car rental giant since 2013. They join Hertz president and CEO Kathryn Marinello, making for two of the three US car rental conglomerate chiefs. In the auto industry — US and global — General Motors CEO Mary Barra is the only woman to run one of these companies. For now, it’s still a boys club — although women make up a third of the technology team on Ford’s Mach-E.

9. Car-sharing continues to be a tough business
Daimler and BMW have called it quits on Share Now, its joint car-sharing unit. A low adoption rate was citied. Share Now will exit the North American market and cease operations in London, Brussels and Florence, at the end of February. Another sad story also came this month, that BlueIndy will cease operations four years after the electric-car-sharing program arrived in Indianapolis. Members of the car-sharing network were told by email that financial reasons were behind the closure. The collaboration with the City of Indianapolis will end on May 21, 2020. BlueIndy said in a news release that 11,000 members took about 180,000 rides over the course of four years, but “Indianapolis drivers have been slow to adopt alternative transportation options and car ownership remains extremely high.”

10. Impact of sulfur emission rules on fuel prices
With the International Maritime Organization (IMO) ready to release its regulation on sulfur emissions on January 1, concerns are being raised over the impact on fuel prices and the economics of transportation. The ocean shipping industry accounts for 90 percent of global trade, and the IMO’s international mandate to reduce “bunker fuel” sulfur content in marine fuel oil from 3.5 percent to 0.5 percent is expected to have a major impact. That will go for maritime shipping and trucking.

According to an IMO analysis at Wood Mackenzie, the global refining system is not equipped to produce the volumes of low sulfur fuel needed to power the world’s shipping industry by the time the regulation goes into effect. While there are existing stockpiles of low sulfur fuel available, the consulting firm expects that existing supply will likely not be enough to buffer global reserves until supply eventually catches up with demand. That consumption rate was about 3.5 million barrels a day from the global maritime sector in 2018. The shipping industry can be turning to diesel products instead of bunker fuel as the supply runs out and bunker fuel goes up in price. Higher prices are expected to be carried over to the trucking industry and other segments. That increased demand would bring higher diesel prices globally, having a profound impact on the trucking industry — especially in the US where trucking provides the lion’s share of freight transportation from these ships to buyers.

Changes at GAM reader subscriber list
Green Auto Market has stopped working with its distribution partner, and the subscriber box will be changing. Until that’s done, new subscribers or those with changing email addresses will need to contact the editor at jlesage378@gmail.com to be placed on the new email distribution list.

Republic Services gaining more recognition in sustainable transportation, Uber releases jarring sexual assault numbers

Republic Services, Inc., just became a member of California Natural Gas Vehicle Coalition after several years of adding NGVs to its fleet and making gains in recycling and waste disposal. The company joins Waste Management, Inc., and other refuse companies, in showing the leadership role these companies can make in clean transportation, renewable fuels, and waste-to-energy projects.

Fleets with refuse trucks are among the largest private fleets in the country; bringing in natural gas makes a real difference in reducing carbon emissions and fuel costs. In Fleet Owner’s Top 500 Top Private Fleets (which tracks heavy-duty vehicles), refuse fleets (under the “Sanitation” category) make up three of the top 10 largest fleets, with Waste Management, Inc., at No. 4 and Republic Services at No. 8. Waste Connections & Operating Co., No. 9, is not running NGVs. The refuse company uses fuel efficient vehicles and is deploying energy conserving practices.

In Fleet Owner’s top 500 private fleet rankings, as of April 2019 there were 18,652 total vehicles in Republic Service’s fleet — 148 tractors, 18,504 trucks, and 947 trailers. In the company’s 2018 annual report, it was reported that 20 percent of its fleet operated on natural gas — which could theoretically put that number out to about 3,600 trucks running on compressed natural gas (CNG) and some of these NGVs on renewable natural gas (RNG). However, the latest data from the company states that the number of CNG-powered trucks would be somewhere between 2,200 and 3,100 or more units (with 3,100 running on “alternative fuels”). The Phoenix-based company’s fleet is spread out over 41 states.

The annual report said that in California, the vast majority of Republic’s fleet runs on natural gas — with more than 90 percent utilizing renewable natural gas (RNG). RNG has the lowest carbon intensity of all commercially available fuels, according to the company. Overall, using CNG provides the company with a competitive advantage in communities with strict clean emissions standards and initiatives.

The company’s fleet is making a gradual conversion over to natural gas and that will continue. In 2018, about 13 percent of the replacement vehicle purchases were CNG vehicles. By the end of 2018, the company operated 37 CNG fueling stations.

Waste Management, Inc., has been carrying the lead — and playing a very visible role — in sustainable fleet operations for the refuse industry. The company also belongs to California Natural Gas Vehicle Coalition and other organizations. NGVAmerica’s board of directors includes Marty Tufte, Waste Management’s corporate fleet director; and the company has been a major sponsor at NGVAmerica’s annual meeting and industry summit.

In Fleet Owner’s top 500 private fleet rankings in 2019, there were 32,056 total vehicles in Waste Management’s fleet — 1,000 tractors, 31,056 trucks, and 2,600 trailers. At the end of 2017, the company reported it had 6,536 NGVs in operation, with 38 percent of its routed collected trucks running on natural gas, and 80 percent of new vehicle purchases going to NGVs.

In Waste Management’s 2019 sustainability report, the company reported having 7,944 alternative fuel vehicles, 132 natural gas fueling stations, and 130 landfill gas-to-electricity facilities. It also had 247 active solid waste landfills, and five active hazardous waste landfills.

Its landfill-gas-to-fuel plants convert landfill gas into RNG that can be used in its vehicles in the form of CNG or liquefied natural gas (LNG). It achieves the end goals of lowering fuel costs and reducing GHG emissions more than 80 percent compared to vehicles powered by diesel. As for converting over from diesel refuse trucks, the company reported it had 855 million diesel gallons displaced over the useful life of existing NGVs.

US Dept. of Energy’s Alternative Fuels Data Center reports that natural gas powers more than 175,000 vehicles in the US and roughly 23 million vehicles worldwide. The advantages of natural gas as a transportation fuel include its domestic availability, widespread distribution infrastructure, fuel cost savings, and reduced greenhouse gas emissions over conventional gasoline and diesel fuels.

The cost of converting trucks over to NGVs or replacing diesel-powered trucks with new refuse trucks running on natural gas, and the cost of installing enough natural gas dispensers to keep these fleet vehicles fueled, has always been a hard sell for fleets seeking funding and support. Conventional diesel-powered refuse trucks can start at about $250,000, with pricing being reduced through fleet purchase incentives. Incremental costs for converting these vehicles over to CNG-powered could be about $40,000 per vehicle, according to a study; and that figure will vary based on government incentives offsetting that price. A new NGV can cost a fleet up to about 50 percent more than the cost of a conventional diesel-powered refuse truck, and that could be much less depending on available incentives. Natural gas fueling stations can range from $10,000 for a smaller fueling unit up to $1.8 million to build a new fuel station with several fuel pumps.

Fleets included in NGV studies are usually reaching operating cost savings in two-to-three years from these clean-fuel vehicles. Much of that comes from the stable, consistent price of natural gas compared to the higher and more volatile pricing for diesel. Diesel has been averaging a bit over $3 per gallon in the US lately, with the equivalent price per gallon for CNG at around $2.25. That gap can be widened by state and local programs bringing fleet fuel costs down for CNG, LNG, and RNG.

NGVAmerica said that there are currently more than 17,000 natural gas refuse and recycling trucks operating across the US, and about 60 percent of new collection trucks on order are powered by natural gas. Clean Energy Fuels reported that beyond Waste Management and Republic, Progressive (in Canada and the US) and Emterra (in Canada) have been bringing NGVs into their fleets for years.

The City of New York’s Department of Sanitation runs the largest municipal refuse fleet in the US, and decided to switch over to NGVs several years ago. That took place when the city of New York seriously took on its air pollution issue.

In October, Republic Services announced it will operate an additional 156 CNG-powered solid waste collection trucks serving customers throughout the country by the end of 2019, bringing the total number of vehicles running on alternative fuels to more than 3,100. It’s fleet is saving about 26 million gallons of diesel fuel annually.

Earlier this year, the company announced that it will utilize increasing amounts of Clean Energy Fuel’s Redeem RNG fuel across 21 states over the next five years. This is projected to reduce fleet emissions by roughly 250,000 metric tons of CO2e (carbon dioxide equivalent) per year.

In its 2018 annual report, Republic said that during that year, new landfill gas-to-energy projects came online, increasing the production of energy used to power homes, businesses and, in some cases, the company’s own vehicles.

In Waste Management’s 2018 sustainability report, the company said that it had four facilities that produce RNG: Altamont Landfill (Livermore, Calif.), Milam Landfill (St. Louis, Illinois.), American Landfill (Waynesburg, Ohio), and Outer Loop Landfill (Louisville, Kentucky). Collectively, they’re capable of producing enough RNG to fuel about 1,850 natural gas collection trucks.

Republic’s 2018 sustainability report said that the company’s fleet emissions had been reduced by three percent through the use of CNG and RNG. Things are looking up on the emissions and safety fronts, according to the report: “Our recycling and waste collection trucks are complex, high performance machines designed to be safe, comfortable and efficient. As we retire and replace older trucks, we are able to take advantage of advancements in alternative fuels in addition to safety technology and other modern efficiencies.”

This year in July, Republic expanded its sustainability goals over the next decade in Blue Planet: 2030 Goals. Along with working toward zero employee fatalities and reducing workplace injuries, two of the other corporate objectives will be to reduce absolute Scope 1 and 2 greenhouse gas emissions 35 percent by 2030; and cultivate regenerative landfills that will increase biogas sent to beneficial reuse by 50 percent by that same year.

And in other news……..
Uber sexual-assault incidents:  Ride-hailing giant Uber just released its first-ever report featuring staggering statistics on sexual assaults and homicides involving Uber drivers and passengers. During 2017 and 2018, more than 3,000 people were sexually assaulted during Uber rides. About 42 percent of those reporting sexual assaults were drivers, and the most severe incidents were put upon passengers; 92 percent of people who experienced sexual assault involving penetration were passengers, according to reports. Women and female-identifying survivors made up 89 percent of the sexual-assault survivors. During 2017 and 2018, there were 19 fatal physical assaults occurring in a total of 18 incidents in relation to Uber; 8 were riders; 7 were drivers using the Uber app; and 4 were third parties (such as bystanders outside the vehicles).

Lyft also faces accountability for several sexual assault incidents committed during rides. These crises show the level of inadequacy in driver background checks, and the ability of non-Uber driers to manipulate the app and take rides. Some have been able to hide their identities when using the Uber app. The strict standards applied to other transportation industries will inevitably make it over to the ride-hailing apps.

Fleet EV study:  Find out what fleets think about bringing electric vehicles into their vehicle selector lists from a new study by consulting firm Mortenson. The adoption of zero and near-zero emission vehicles in public and private fleets is growing. The rapid change is causing fleet owners, policymakers, and public infrastructure experts to examine what clean technology means for them. Over 200 professionals were interviewed at the 2019 ACT Expo.

And a few more news briefs………

  • The 2020 Ford Escape Hybrid equipped with front-wheel drive beats out the segment with best-in-class EPA-estimated ratings of 44 mpg city and 41 mpg combined, according to Ford. The 2020 Escape Hybrid Titanium with front-wheel drive has an EPA-estimated rating of 37 mpg on the highway.
  • Elon Musk was cleared by the Los Angeles jury on the defamation lawsuit British caver Vernon Unsworth had filed over the Tesla CEO’s “pedo guy” Twitter comment.
  • California Air Resources Board (CARB) announced that the application period for the competitive Volkswagen Mitigation Trust Combustion Freight and Marine project funding is open. This solicitation is open to eligible owners of in-use freight trucks, switcher locomotives, ferries, tugboats and towboats throughout California.
  • Tesla said its Model 3 cars built in China will qualify for that government’s new energy vehicle subsidies.
  • Eighteen private-sector companies released Road Map to a US Hydrogen Economy that could support zero emissions transportation and significant economic gains.
  • Tesla said on its blog that the Model X won a 5-star rating from the European New Car Assessment Programme (Euro NCAP), which evaluates a car’s safety assistance features as well as its ability to protect adults, children, and vulnerable road users.

 

LG Chem and SK Innovation in battery legal battle, Gig Economy meets the Gilded Age

Battle over South Korean battery tech:  LG Chem and SK Innovation are each asking the US International Trade Commission to bar the other South Korean electronics company from supplying batteries to Volkswagen, GM, Ford, Jaguar, Audi, and Kia. The stakes are quite high, with one analyst predicting that country’s electric vehicle battery market will grow 23 percent a year to reach $167 billion in sales by 2025.

In America, the battle ensued when LG Chem filed a claim that SK Innovation won the Volkswagen contract fraudulently by receiving trade secrets supplied by ex-LG Chem employees who’d taken jobs with the smaller competitor. SK Innovation had won a contract to build batteries for VW’s ambitious EV product launch campaign, at the automaker’s factories in Germany and in Chattanooga. SKI also was able to start work on a new battery factory in Georgia, about 150 miles from Chattanooga, and another in Hungary. The trade commission is expected to make a preliminary ruling in June and issue a final decision next October.

Tesla, Uber & Amazon — The Gig Economy meets the Gilded Age:  What do Tesla, Uber, Amazon, Lyft, Instacart, and DoorDash have in common? They’re great to buy from, but you probably wouldn’t want to work for them as an independent contractor or employee.

We love the perks — Tesla’s fun-to-drive electric cars, belonging to Amazon Prime, cheap fare Uber and Lyft rides, having the annoyances of grocery shopping taken away by Instacart, and tapping into other efficient, affordable gig economy services. But we usually don’t like working for them — just ask around and search the internet.

Case in point:  An engineer working for Elon Musk’s SpaceX intergalactic travel company told me about the intensely demanding, stressful long hours he has to work. While Musk is still an icon for him as a pioneer in space flights and electric cars, he doesn’t see himself able to live that way for very long. As we’ve heard about from executives leaving Tesla, Musk expects employees to give their lives to the cause.

Another one: A woman working for Amazon told me about attempting to be reclassified from a part-time employee to full-time employee with benefits. She and her Amazon co-workers are expected to work extra hours and take on extra duties. But she’d received a company letter detailing, once again, why she didn’t make it to full-time status with medical coverage and other benefits. Like working for other prominent, well publicized tech employers, what at first seemed like a wonderful career opportunity can go upside down.

For independent contractors working for Uber and the big wave of mobile app-based startups since then, the initial motivating factors behind doing this kind of work have been waning for the past two years.

A few key developments have been taking shape. (See my blog for more………)

And in other news:
Chaotic trade climate:  President Donald Trump said a trade agreement with China might have to wait until after the US presidential election in November 2020, tarnishing hopes that their trade war would go away and its chaotic impact on trade deals and the economic climate. “I have no deadline, no,” Trump told reporters in London, where he was due to attend a meeting of NATO leaders. “In some ways, I like the idea of waiting until after the election for the China deal. But they want to make a deal now, and we’ll see whether or not the deal’s going to be right; it’s got to be right.”

Yesterday, Trump said he would hit Brazil and Argentina with trade tariffs for “massive devaluation of their currencies.” That was followed by a US threat to slap duties of up to 100 percent on French goods, from champagne to handbags, because of a digital services tax that the Trump administration says harms U.S. tech companies.

Turbulence in Hong Kong from the uprising that’s being suppressed by Chinese military has also been part of the upheaval. Automaker stocks seem to be underperforming lately over concerns that China could retaliate over U.S. legislation in support of the protesters in Hong Kong. “The legislation’s passage carries unfortunate timing for the US auto brands, which are also coping with 16 straight months of declining China auto sales,” notes Bloomberg Intelligence analyst Steve Mann.

Will 5G be here soon?:  For those wondering when 5G will be here to take our smart phones and cars to the next level, T-Mobile says it will be the first carrier to offer a nationwide network starting Friday. There are a few caveats, though. It will be using T-Mobile’s 600MHz spectrum that taps into airwaves like the ones used for 4G LTE and bundles them together to deliver faster speeds — offering “low-band” 5G. The company says it will be a precursor to a more robust network that will be made possible with the combination of Sprint’s vast airwave holdings — which made Sprint a direct competitor to AT&T and Verizon Wireless years ago. However, T-Mobile’s acquisition of Sprint still has to complete legal hurdles. The US Justice Department and Federal Communications Commission gave the merger the green light; but, it faces a lawsuit from several state attorney general, and that trial will start Dec. 9. T-Mobile is promoting the 5G launch with special prices on a new OnePlus phone and one from Samsung. The launch of 5G has been a very hot topic for those attending AutoMobility LA and CES in Las Vegas next month. It will have a lot to do with self-driving cars making it to the next level through its use of C-V2X, a communications technology using the same 5G networks coming to our phones. It will allow vehicles to communicate with each other, with traffic signals and with other roadside gear. It’s a key element of making cars safer, diverting traffic jams, and other benefits.

Reserving a Fisker Ocean:  Interested in getting one of the first Fisker Oceans to roll off the assembly line? Put down a $250 down payment by using this iPhone app, called Fisker Flexee. Coming in early 2022, the Fisker Ocean will be “the world’s most sustainable vehicle.”

Musk sued for “pedo guy” insult:  Tesla CEO Elon Musk will go on trial in a defamation lawsuit in Los Angeles federal court starting today based on his infamous Twitter post calling a British cave explorer a “pedo guy.” The jury will decide whether Musk committed a negligent act aimed at Vernon Unsworth, who helped rescue a group of boys trapped in a network of caves in Thailand in July 2018. Musk did apologize and deleted the post, but Unsworth sued Musk for damages, claiming his reputation was damaged by being baselessly branded as a pedophile. Musk plans to testify in how own defense for a trial expected to run about five days. Back in July 2018, Musk fired off a round of irate tweets after Unsworth criticized the Tesla and SpaceX CEO’s offer to help with the rescue mission by sending a mini-submarine built by SpaceX. Musk has said in court documents that “pedo guy” was a common insult “synonymous with ‘creepy old man’” when he grew up in South Africa.

Hydrogen and fuel cell trucks seeing a breakthrough, BMW report shows global EV share by brand

This past year has seen something of a renaissance for hydrogen and fuel cell vehicles, with much of the interest being directed at hydrogen-powered commercial vehicles.

Nikola Motors, Toyota, and Hyundai are dedicating intensive capital and resources to designing and building hydrogen-powered commercial trucks. Daimler Trucks, Kenworth, and truck engine maker Cummins are also entering the fuel cell space.

These vehicles qualify for zero emission vehicle mandates and have a few appealing performance qualities. They offer similar qualities as electric vehicles in performance and torque, but much longer range. Time needed for refueling is comparable to gasoline- and diesel-powered vehicles. The cost of producing hydrogen and manufacturing fuel cell vehicles continues to be high, though it has come down in recent years.

Japan, by far, has the largest fueling infrastructure in the world, with Germany following in second place. While in limited production numbers, Toyota and Honda have their fuel cell cars in several countries, followed by Hyundai and Daimler.

So let’s look at some of the numbers…….

Hydrogen Refueling Stations by Country:
Japan — 109
Germany — 70
United States — 44
South Korea — 28
China — 15
England — 12
Denmark and France — 11
Norway — 9
Canada — 7
Austria — 6
Scotland and Sweden — 5
Spain and Switzerland — 4
Australia, Belgium, Iceland, India, and the Netherlands — 3
Finland and India — 2
Brazil, Costa Rica, Czech Republic, Malaysia, Saudi Arabia, Slovenia, Taiwan, Turkey, United Arab Emirates, and Wales — 1

Sources: Hydrogen Analysis Resource Center and Alternative Fuels Data Center

Fuel Cell Passenger Cars and Buses by Region:
North America:
Toyota Mirai, Honda Clarity Fuel Cell, and Hyundai Nexo (which replaced the Hyundai Tucson Fuel Cell). New Flyer manufactures many of the fuel cell buses acquired by transit agencies in the US, with many of these buses equipped with Ballard fuel cells.
Europe:
Daimler GLC F-CELL, Daimler B-Class F-Cell, Toyota Mirai, Honda Clarity Fuel Cell, and Symbol fuel cell range-extended vans.
Asia:
Toyota Mirai, Hyundai Nexo, Honda Clarity Fuel Cell, and Daimler GLC F-CELL. Both Toyota and Hyundai offer fuel cell buses. Several Chinese manufacturers have developed their own buses, including state-owned SAIC Motor and Geely Auto Group, which also owns the Volvo Cars and Lotus brands.

Sources: US Dept. of Energy, Hydrogen Europe, and Reuters

Nikola has become the star of fuel cell vehicles, regularly making dramatic announcements. These include a breakthrough in battery technology that could double the range of electric vehicles without adding any weight; and a monthly lease payment that would require customers to agree to a million-mile lease at the cost of 95 cents mile, or $950,000 over a typical seven-year lease to remove some of the risk of buying a fuel cell truck. The hydrogen-powered truck maker also has plans in the works for setting up about 700 hydrogen fueling stations. Budweiser brewer Anheuser-Busch has started testing Nikola semi-tractor trucks in its fleet.

Along with making the top-selling fuel cell car in the work (the Mirai), Toyota is also committed to fuel cell trucks. The company has been testing a hydrogen fuel cell yard truck that moving shipping containers within the Port of Los Angeles. Toyota also entered a project with truck maker Kenworth to build 10 zero-emission Class 8 trucks. They’ll be supported by the California Air Resources Board’s Zero and Near-Zero Emissions Freight Facilities grant, and these trucks will be used at the harbor complex for the Ports of Los Angeles and Long Beach.

Hyundai plans to build a production capacity of 500,000 fuel cell systems for passenger and commercial vehicles by 2030 at a cost of about $6.4 billion. The automaker recently unveiled the concept of its planned HDC-6 Neptune hydrogen fuel cell truck. Hyundai sees opportunities in the US, but the Asian market would also be hot — with serious commitments given to fuel cell vehicles and hydrogen stations by the governments of South Korea, Japan, and China.

Hydrogen fuel cell buses are seeing more demand. They’ve been particularly well tested in California by transit agencies, and China is seeing a lot of them being deployed.

Ballard Power Systems, based in British Columbia, develops and produces fuel-cell products and solutions that are part of these fuel cell buses. The company is elated to see its shares soar after 40 years of struggles in the industry.

The company has seen a dramatic change over the past year, according to Randy MacEwen, CEO of Ballard. Some of that has been coming through customers In Europe, where operating a fuel cell-powered electric bus is now cost competitive with a traditional fuel version, he says. Use of the fuel cell technology is diversifying into ships, trains, and forklifts.

Hydrogen has been taking off in various applications in recent years. As for history, NASA began using liquid hydrogen in the 1950s as a rocket fuel, and the agency was one of the first to use hydrogen fuel cells to power the electrical systems on spacecraft.

Beyond transportation fuel, about 55 percent of the hydrogen produced around the world is used for ammonia synthesis (especially for fertilizers), 25 percent in refineries for intermediate oil products, and about 10 percent for methanol production that’s used in the manufacturing of several types of polymers.

Building an infrastructure for hydrogen and new developments of fuel cells is finally becoming profitable for companies like Ballard Powers and several others. Manufacturers are looking forward to seeing buyer interest increase. EVs provide much of the completion, but it’s unlikely it will ever take hydrogen out of the race.

And in other news:

  • BMW report shows global numbers:  BMW just added global market share by brand for electric vehicle passenger car sales for the first time in its charts. Tapping into IHS Markit’s new vehicle registration database, the study reports that Tesla has 18 percent, BYD (in China) has 11 percent, BMW 6 percent, Beijing Auto 5 percent, Volkswagen 4 percent, Nissan 4 percent, Hyundai 4 percent, Roewe 3 percent. Kia 3, Renault 3, and Geely-Emgrand 3 percent. Other automakers make up the remaining 36 percent of global share. Roewe is a vehicle marque created by the Chinese automaker SAIC Motor, and BYD, Beijing Auto, and Geely-Emgrand also represent Chinese makers — bringing their share to 22 percent overall. Vehicles included in the count are “Electric, Electric w. REX, Electric w/o REX, PHEV Diesel and PHEV Petrol.”
  • Cybertruck vs. F-150:  Ford says a new video being streamed out by Tesla is unfair, and CEO Elon Musk has agreed to a re-match. The new sci-fi, futuristic Cybertruck is competing in a tug-of-war with the Ford pickup, and looks to be easily pulling it away. Launched Thursday night in LA at the tail-end of the media days for the LA Auto Show, Musk says that his company has already taken 200,000 orders for the electric pickup.
  • Other highlights from LA Auto Show and AutoMobility LA:  The 2020 Toyota Corolla won Green Car of the Year for its overall fuel efficiency in both the regular and the hybrid versions. A second award was given to the Honda CR-V Hybrid as Green SUV of the Year. The new hybrid version the CR-V will go on sale in spring 2020. At AutoMobility LA — Hackathon winner and second place; Startup winner; and Karma Automotive’s unveiling of its SC2 concept car with its hinge winged doors.

US more energy independent now, Ford Mustang Mach-E electric SUV a star at LA Auto Show

“America is addicted to oil, which is often imported from unstable parts of the world.”
President George W. Bush during State of the Union speech, Jan. 31, 2006 

I had a fascinating conversation with an economist at a social gathering last week. We discussed the impact of oil imports and exports on the global economy — especially its impact on US energy independence and climate change policies. The US has entered a new place in the world’s oil supply, now exporting more oil than importing it — and less vulnerable to occasionally turbulent global oil prices than was the case years ago.

This economist finds it quite ironic that two other countries have reputations for supporting sustainability and other forward-thinking policies, but are also leading global oil exporters. The US will have to face this scrutiny as well, he said.

One of them is Norway, a leading backer of the UN’s Paris agreement on climate change, and the most impressive nation in the world for per capita electric vehicle sales; along with generous government incentives for EV purchases and charging infrastructure.

Norway was the 13th largest global oil exporter last year, at 1,254,920 barrels per day.
It was named the 20th most oil dependent country in the world during 2016 in another study, with 3.84 percent of its GDP coming from oil revenue, and fuel exports making up 53 percent of its merchandise exports that year. About 45 oil wells were drilled in 2018, up from about 30 in 2017.

Canada, the second nation mentioned by the economist during our conversation, is recognized for having the best healthcare system in the world and for being proactive on climate change through its government’s policies. However, it was the fourth largest oil exporter in the world last year.

Canada exported 3.5 million barrels of oil per day to the US in 2018, 96 percent of all Canadian crude oil exports, according to Natural Resources Canada. Canada supplied 43 percent of US oil imports last year; followed by Saudi Arabia, Mexico, Venezuela, and Iraq.

The US was the eighth largest oil exporter last year. Saudi Arabia and Russia were No. 1 and No. 2. Saudi Arabia has much larger export volume than any other country in the world.

2018 Largest Oil Exporters — Barrels Per Day

1. Saudi Arabia — 8,300,000
2. Russia — 5,225,000
3. Iraq — 3,800,000
4. US — 3,770,000
5. Canada — 3,596,690
6. UAR — 2,296,473
7. Kuwait — 2,050,030
8. Nigeria — 1,979,451
9. Qatar — 1,477,213
10. Angola — 1,420,588

Sources: CIA World Factbook and US Energy Information Administration

The US is not an oil-dependent country on the import vs. export ratio as of 2019, but the addiction to petroleum continues. On the bright side, the US is less dependent on OPEC, the league of oil producing nations that caused energy and economic chaos in the US twice in the 1970s (along with the Iranian revolution in 1979) — and that continues to be a major power player in the global oil market.

The US is now exporting crude oil to more nations than it’s importing from, the Energy Information Administration said in a new analysis in late October. During the first half of the year, US crude oil exports average 2.9 million barrels per day, according to the EIA, a number that’s gone even higher in the second half of 2019. In the first seven months of this year, the US imported oil from a maximum of 27 nations during a given month; that had gone as high as 37 nations a decade earlier.

A surge in domestic production has made the US a crude oil export powerhouse, a goal that had been the basis of the Bush administration’s energy policies in the previous decade that first created the Energy Policy Act of 2005; and with some of it carried over to the Obama administration. Bush’s famous State of the Union quote on oil addiction has been used as both an irony (raising the question: How serious was the Bush administration on weaning the US off petroleum?), and supporting moves to stabilize US energy through reducing oil imports from countries like Iraq and Kuwait where America had sent troops to; and other countries, especially OPEC members, with hostile attitudes and actions toward the US.

The Energy Policy Act promoted US nuclear reactor construction through incentives and subsidies — which has since been discredited and sidelined following Japan’s Fukushima Daiichi nuclear disaster in 2011. The Act also provided loan guarantees to entities that develop or use innovative technologies that avoid the by-production of greenhouse gases.

The Act also launched the Renewable Fuel Standard that requires transportation fuel sold in the US to include a minimum volume of renewable fuels. The RFS was expanded and extended in the Energy Independence and Security Act of 2007. These federal laws were where standards came from governing the amount of biofuel that must be mixed with gasoline sold in the US. It soon because the source of a battle between oil companies and refineries versus corn farmers and ethanol producers.

Crude oil is produced in 32 US states and in US coastal waters, according to EIA. In 2018, about 68 percent of total U.S. crude oil production came from five states. Texas is the leader with 40.5 percent of domestic oil coming from that state. North Dakota was the second largest at 11.5 percent, followed by New Mexico at 6.3 percent, Oklahoma at 5 percent, and Alaska at 4.5 percent of domestic crude oil last year.

It’s one of the reasons gasoline is much cheaper in Texas than other states that have to ship and pipeline over their oil and might have state regulations that raise the price at the pump. For example, gasoline recently has been more than $4 a gallon at some California gas stations. In Texas, it’s been a little bit over $2 a gallon.

The US has seen its supply of oil and natural gas surge over the past dozen years through domestic wells and with natural gas coming much more from shale gas fields. Hydraulic fracturing (“fracking”) has been the key driver of change in domestic fuel — where oil and gas are extracted from tiny pores in rock formations coming from shale, sandstone, and limestone. Fracking breaks up the rock in formations creating pathways drawing out oil and gas from the rock layers. It involves forcing water, chemicals, sand, or other materials under high pressure into the wells. Steam, water, or carbon dioxide (CO2) can also be injected into a rock layer to help oil flow more easily into production wells.

Fracking has been the source of public protests and litigation from environmental groups, pushing the federal government to enforce regulations. It won’t be going away anytime soon with advocates insisting its become safer and an economical use of clean energy. Critics say fracking brings devastating consequences to drinking water supplies, air pollution, releasing more greenhouse gases, and triggering earthquakes.

More recently, new applications of fracking technology and horizontal drilling have led to the development of new sources of shale gas that have offset declines in production from conventional gas reservoirs, and has led to major increases in reserves of US natural gas. Oil supply has been helped by the Trump administration weakening environmental regulations for offshore and land oil drilling.

What does it mean for transportation fuel in the US going into next year?

The EIA expects regular gasoline retail prices to average $2.65 per gallon in November and fall to $2.50 per gallon in December. The agency forecasts that the annual average price in 2020 will be $2.62 per gallon. EIA expects that Brent and West Texas Intermediate oil prices will see gradual changes next year — up to $65 per barrel compared to $61 this year for Brent; WTI prices are expected to be about $4 per barrel lower than Brent in late 2019 and throughout 2020.

The US Dept. of Energy’s Alternative Fuels Data Center sees price stability for these fuels since 2014 — compressed natural gas, liquefied natural gas, propane, electricity, ethanol (E85), and biodiesel (B20 and B99-100). Gasoline and diesel have seen more fluctuation in the past five years, but have stayed within a $2 to $3 per gallon national average (with diesel slightly over $3 lately).

Electric vehicle sales are down now in the US, and fuel-efficient smaller cars and crossovers have been down in sales compared to trucks and SUVs since oil prices plummeted downward in 2014.

Spiking oil prices in 2008, and periods of turbulent pricing in 2010 through 2012, helped automakers sell smaller vehicles, EVs, hybrids, and smaller crossovers. All of that changed in 2014 when oil prices plummeted downward — and gasoline and diesel pricing also dropped — helping pickups and SUVs take the lead in new vehicle sales.

Being less dependent on oil imports has helped US gasoline and diesel prices remain stable and less prone to price spikes than a decade ago — less affected by decisions made by OPEC and disruptive events in key supplier markets. It also raises the bar on making the case for consumers and fleets to purchase new vehicles powered by electricity, hydrogen, propane autogas, natural gas, and renewable fuels.

And in other news……..
Ford is rolling out the 2021 Ford Mustang Mach-E electric crossover SUV at this week’s LA Show press days. It will have two different battery sizes, with one of them having the capacity to go up to 300 miles per charge. Buyers can also choose from rear-wheel drive, all-wheel drive, and different power outputs. Ford thinks the Mach-E will make a big splash, its first ever all-out competition against Tesla and the majors, tapping into the performance history and style of the Mustang. EVs are expected to play the leading role at this year’s LA Auto Show product launches, with the Audi E-Tron Sportback and, post-show, Tesla’s Cybertruck. Overall, new SUVs/crossovers will be the leading vehicle classification on display.

California announced yesterday that it will halt all purchases of new vehicles for state government fleets from General Motors, Toyota, Fiat Chrysler, and other automakers backing the Trump administration in a battle to strip the state of authority to regulate tailpipe emissions. It’s been a good market for OEMs on the fleet side; between 2016 to 2018, the state said it purchased $58.6 million in vehicles from GM, $55.8 million from Fiat Chrysler Automobiles, $10.6 million from Toyota, and $9 million from Nissan.

Volkswagen’s Electrify America announced today an agreement with Lyft to provide the ride-hailing company’s Express Drive program renters of electric vehicles with convenient and included charging on its DC fast charging network. Express Drive is Lyft’s short-term car rental program that gives people wanting to drive on its platform access to an electric vehicle through its rental providers.

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.

 

This topic has been further explored in a Green Auto Market analytical report. Click here to see the market report available for purchase and download.

 

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.

 

This topic has been further explored in a Green Auto Market analytical report. Click here to see the market report available for purchase and download.

 

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.

 

This topic has been further explored in a Green Auto Market analytical report. Click here to see the market report available for purchase and download.

 

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? 

This topic has been further explored in a Green Auto Market analytical report. Click here to see the market report available for purchase and download.

 

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.