Month: March 2019

BMW beats Tesla in Europe, Prediction on electric fleet trucks

Competitors beating Tesla in Europe:  While Tesla dominates electric vehicle market share in the U.S., Europe is benefiting local automakers even more. BMW just issued a report conducted by IHS Markit based on new vehicle registrations from Feb. 2018 to Feb. 2019. BMW has 16 percent of plug-in vehicle market share in Europe, while Tesla ties for fifth place with Volvo. Volkswagen, Nissan, and Renault came in 2nd through fourth place. In Germany, BMW has 20 percent share with Tesla coming in at 3 percent. In Norway, the largest EV market in Europe, BMW has nearly 77 percent of that market while Tesla saw its sales drop there in the fourth quarter. Lack of retail stores in key European metro market areas is probably a factor. Tesla is tied with China’s BYD for first place globally, with Beijing Auto coming in second and BMW third. China is expected to play a big role in the future of EV sales. Tesla is getting ready to open its Shanghai production plant in May; while BMW was granted permission last year by the Chinese government to increase its stake in Brilliance China, the first company to take more than 50 percent in one of the joint venture vehicle manufacturers with factories in China. BMW hopes to lower its costs in that market, with EVs expected to be part of its growing presence.

Ford building more EVs and AVs in USA:  Ford has recommitted to building more electric vehicles and autonomous vehicle technology at its North American plant, with less emphasis on AVs. The $900 million Ford had planned to spend on AV production in its Flat Rock Assembly plant in Michigan through 2023 will instead be largely dedicated to EVs and the next-generation Mustang, the company said. The Flat Rock plant will become the production home to vehicles from the company’s “next-generation battery electric flexible architecture.” These vehicles will follow the all-electric performance SUV coming in 2020 from Ford’s Cuautitlan, Mexico, plant. Autonomous vehicles will be coming from a new AV manufacturing center in southeast Michigan. The company said that production of Ford’s first autonomous vehicles will begin in 2021 for deployment in commercial services to move people and goods.

Trump attack misses the point:  In the aftermath of a bitter Twitter feud with General Motors and the United Auto Workers in previous days, President Trump visited Ohio to continue attacks. After viewing the Lima, Ohio-based Joint Systems Manufacturing Center, which makes the 1M Abrams tank, on Wednesday, Trump attacked deceased Sen. John McCain and blamed Democratic union leaders for GM’s decision to close a plant in Lordstown, Ohio, eliminating about 1,700 jobs. All of this comes after announcements by GM and Ford late last year to initiate layoffs and close more plants to offset losses in the slowing economy and the steep tariffs implemented by the Trump administration. Tesla stirred up its own controversy last week after announcing it would close its U.S. retail stores and go to online sales to cut costs — which CEO Elon Musk later cut down to an expected 10 percent to 30 percent store closures. Tesla is joining several major global companies feeling pressure to close retail stores as shareholders put more pressure on management to increase performance and profits. Stores may not be worth the cost as companies such as Amazon lead the revolution toward online shopping and fast delivery services, analysts say. Overall, GM, Ford, Tesla, and competitors are facing a wave of changes in the imminent future impacting profits and market share. Job losses will continue as industries consolidate, robotics take over plants, and consumers want less retail stores and more digital transactions. The issues are much deeper than merely job losses at plant closures in Ohio and Michigan.

Model Y reveal:  Tesla CEO Elon Musk revealed the company’s Model Y a week ago, a compact SUV that had been mentioned long before. It shares the same architectural platform with the Model 3 compact electric car. It’s more conservative than Tesla’s other SUV, the Model X, with its falcon-wing doors. It’s putting safety and cost savings before flash, as Tesla continues to reach out more to middle income consumers with its Models 3 and Y. It offers the perks of a hatchback such as the Toyota Prius with the advantages of driving a smaller vehicle through crowded cities instead of a large SUV. The Model Y’s Standard Range model will roll out in the spring of 2021 with a $40,200 price tag and a 230-mile range.

Plug-in sales for February:  EDTA’s Electric Drive Sales Dashboard on U.S. sales in February reported 17,239 plug-in vehicles sold, made up of 6,792 plug-in hybrids and 10,447 battery EVs. The 34,279 plug-in vehicles sold so far in 2019 represents a 19 percent increase over the total sold thru the same period last year. The association will be including fuel cell electric vehicle sales data in future reports.

Prediction on electric trucks:  GNA’s Erik Neandross shared his thoughts on the boom coming this year with electric trucks coming to market at major trade shows and through compliance with government policy. Much will be learned in the next one-to-three years as a wave of electric work trucks come to market. Fleet managers and operators will be taking a close look at operating costs as more EVs go into daily fleet operations.

Tesla closing most of its stores, China showcased on 60 Minutes

Tesla closing stores, revealing Model Y:  Tesla is taking a giant leap on the car-selling front: closing down most of its shopping-mall stores, switching to online sales to cut down the high costs of running sales offices. Tesla wants to keep its pricing competitive especially on the Model 3 that starts at $35,000 while increasing the profit margin. The company does benefit from hosting invitation-only ride-and-drive events in major cities, which takes away some of the imperatives to operate retail stores. It will also be the hub for the next electric vehicle coming out, the crossover Model Y. Tesla will be revealing it March 15 at an event at the Los Angeles Design Studio, according to a recent tweet by CEO Elon Musk. It’s said to be 10% larger than the Model 3 and will cost about 10% more and will have slightly less range from the same battery. It will also share the same platform to save costs. It won’t have falcon wings like the Model X. The goal is to reach volume production of the Model Y by the end of 2020.

Lyft goes public:  Lyft has beaten ride-hailing giant Uber to the stock market with its initial public offering on Friday, raising about $100 million from placeholders. It will be traded on the Nasdaq market under the stock ticker LYFT. If Uber does make it soon the stock market, shareholders will be buying into companies that have been growing substantially while taking significant losses. Lyft’s net loss climbed to $911 million in 2018 from $688 million a year earlier. Uber lost $1.8 billion last year, according to a recently released filing by the market leader. Investors have to decide whether losses will continue for the next few quarters. Uber and Lyft have been fast-growing businesses inspiring many other mobility startups, which is part of the appeal. Lyft estimated last fall that it had reached 35% of U.S. market share. Market analyst firm Second Measure reported in October that Uber held 69.2% of U.S. market share, and Lyft had 28.4%.

DOE research funding:  The U.S. Department of Energy announced availability of up to $51.5 million for research of technologies for trucks, off-road vehicles, and the fuels that power them.  Funded through DOE’s Office of Energy Efficiency and Renewable Energy (EERE), this FOA addresses priorities in gaseous fuels research, including natural gas, biopower, and hydrogen; heavy-duty freight electrification; hydrogen infrastructure and fuel cell technologies for heavy-duty applications; and energy efficient off-road vehicles. “As the fastest growing fuel users, trucks offer an important opportunity to use innovation to improve energy productivity,” said Under Secretary of Energy Mark Menezes. “Through research and new developments in both energy efficiency and domestically-sourced fuel technologies, we can not only strengthen our energy security but also improve transportation affordability for our nation’s trucking industry – helping those who deliver American goods and those who use them.”

China’s EV market explored:  The “60 Minutes” news show recently broadcasted an in-depth look at China’s booming “new energy vehicle” market. Even with the possibility of generous government incentives being cut back, China is still the hottest electric vehicle market in the world. The U.S. had been the hub for years, but has been falling behind China in consumer and fleet EV purchases. Government incentives are getting harder to find as the Trump administration backs away from EV income tax incentives; and talks between the federal government and California on the state’s zero emission vehicle program have reached a stalemate. Chinese EV startup Nio was featured in the “60 Minutes” report, which helped its stock prices shoot up 8 percent last week. Nio sees itself as a Tesla-competitor. The startup has benefited from its price being about half of that of a Tesla in the Chinese market, and it doesn’t pay import taxes as it manufactures locally. Tesla hopes to cut that down, along with competition from majors in the market, by setting up its own plant and cutting away shipping costs and import taxes.