There were 572,000 Wuling Hong Guang Mini EV vehicles sold in China in 2022, according to analyst firm Inovev.
The vehicle is produced by SAIC-GM-Wuling. A joint venture company. With that middle bit being General Motors.
South America, Inovev says, is GM’s third-largest market (after China and the U.S., respectively).
In 2022 GM sold 350,000 vehicles in South America.
572,000 of one model in one country.
350,000 of a show room on a continent.
Sort of puts the China market in perspective.
By Gary S. Vasilash
Last month Tesla did something that OEMs almost never do. (And in its history, Tesla has done lots of things that traditional OEMs almost never do, so at least in this regard it is being consistent.)
It cut the price of its vehicles in China, Germany, and the U.S.
These weren’t slight, either. In the U.S., for example, the Model Y Performance was cut by 19% and the Long Range version by 20%.
There were all manner of assessments as to why this happened. Some suggested that Elon Musk’s Twitter distraction was causing the company to lose sales. Others were pointing out that there is increased competition from some of the traditional OEMs. (Who, to be frank, are bigger on rhetoric about their electric scale today and tomorrow than they are in putting EVs in customer’s driveways.)
Tesla has some 2/3 of the U.S. EV market.
Consider: while the Ford F Series seems like a force of nature when it comes to sales, in 2022 there were 653,957 of those trucks sold—and GM sold 764,771 Silverados and Sierras combined, so it isn’t like either of the primary players have anything near 2/3. Yet a company that wasn’t taken all that seriously 10 years ago now dominates a category.
Shortly after Tesla made its announced cuts, the folks at Ford joined in on reducing the prices of its 2023 Mustang Mach-E models. The reductions ranged from $600 on the Select eAWD Standard Range model to $5,900 for the GT Extended Range.
Ford clearly wants to move metal. What’s curious, though, is that in 2022 it sold 39,458 Mach-Es, which is a 45.4% increase over the number it sold in 2021. It’s not like things were lagging. (Ford execs may have noticed that in July of last year GM cut the prices of the Bolt EV and Bolt EUV by $5,900 and $6,300, respectively, and those vehicles ended the year at 38,120 deliveries, not only close to that Mach-E number, but a 53.5% increase over 2021–greater than the Mach-E rise. Although it is hard to imagine the vehicles being cross-shopped..)
Everyone knows that EVs are more expensive than vehicles with internal combustion engines for a wide array of reasons. And while the overall percentage of EVs sold in the U.S. is still small—5.8%–it is growing, not declining.
So why were the cuts to prices made and will other OEMs follow suit?
Those are the primary questions raised and discussed on this edition of “Autoline After Hours.” Charlie Chesbrough, Cox Automotive Senior Economist, and Joe White, Reuters Global Automotive Correspondent, join “Autoline’s” John McElroy and me to talk about those topics and more.
And you can see the show here.
By Gary S. Vasilash
On September 18, 2021, this announcement was made by Rory Harvey, vice president, Global Cadillac:
“Today, reservations for the 2023 Cadillac LYRIQ Debut Edition sold out in just over ten minutes and we continue to see a lot of enthusiasm around the brand – both current product and in our all-electric future. The initial response for LYRIQ has been extraordinary. Since the show car unveiling last year, more than 200,000 people have expressed interest in learning more about the vehicle and our electric future.”
Deliveries of the electric SUV, which had obtained significant, deserved acclaim, began in July 2022.
The LYRIQ is built in the GM assembly plant in Spring Hill, Tennessee. The factory originally built for Saturn. At the plant the Cadillac XT5, Cadillac XT6 and GMC Acadia are also produced.
LYRIQ went into production on March 21, 2022.
So keep in mind: production starts in March, deliveries start in July, and thousands of people wanted to get behind the wheel of Cadillac’s first electric vehicle.
Now admittedly all OEMs in 2022 had to deal with all manner of issues related to COVID and chips and supply chain snafus.
But here is something that is simply startling:
GM announced its U.S. deliveries for 2022.
All in, 2,274,088 vehicles, making it #1 in the U.S.
Cadillac LYRIQ: 122 vehicles.
How many of those LYRIQ “hand wavers” are going to put down their arms and go across the street to an Audi or Mercedes store?
And what about those who were part of the 10-minute sellout? How are they feeling about their decision?
Yes, building vehicles is hard.
But you would imagine that for a vehicle that is as important to Cadillac as the LYRIQ is, that would have been addressed and any speedbumps mitigated.
(Incidentally: while the LYRIQ was the vehicle with the fewest deliveries among all GM vehicles for 2022, the second lowest was another electric vehicle that sold out in 10 minutes when its reservations opened in October 2020 and is now said to be sold out for at least two years: the HUMMER EV. GM delivered 854 in all of 2022.)
By Gary S. Vasilash
One thing that is occurring is that OEMs are decreasing the number of types of vehicles that they have on offer.
Consider, for example, Ford.
If you want a “car,” then you’d better be happy with a Mustang because that’s all that’s available.
It has gone from arguably a “full-line” manufacturer to a SUV/truck manufacturer.
And it is doing well in that truck category, as the company announced that the F-Series is the best-selling truck in the U.S. for 46 years running, and that it sold more than 640,000 trucks in 2022 (this isn’t just the F-150 but the F-550 chassis cab, so it is a mix of personal and commercial vehicles).
Toyota is a full-line manufacturer, as it builds cars, trucks and utes.
And while it might seem as though this spreading might cause some dilution of vehicle sales (i.e., with a range to chose from, a consumer might pick a car rather than a ute or a truck rather than a car, thereby diminishing the overall sales for a given vehicle), when it added up its 2022 U.S. sales it had some impressive numbers:
While some might think that the car segment isn’t all that interesting, know that it sold 295,201 Camrys in 2022.
It also sold 222,216 Corollas (the number-one selling compact in the U.S.)
And there are other cars on offer: Supra, GR86, Mirai, Avalon, and Prius.
The Tacoma clearly is a truck with legs. There were 237,323 sold in 2022. A point of comparison would be the combined number of the Chevy Colorado and GMC Canyon: 117,016.
The RAV4 run is perhaps the most impressive of all. While Ford and GM can legitimately argue—as can the Stellantis Jeep brand—that they have deep, deep SUV know-how and capability, the RAV4, of which 399,941 were sold in 2022, just keeps leading the list.
Seems that offering a full line can have some advantages for the OEMs’ sales and the customers’ choice.
By Gary S. Vasilash
This is the sort of thing that can cause someone—employee, investor—to gulp when they read it in relation to a company’s Q3 financials:
“We have taken deliberate steps to support our business for both the near-term and the long-term. We are managing our business prudently, and prioritizing initiatives that reduce costs, unlock operating efficiencies, profitably grow market share and create better experiences for our associates and customers.”
That’s Bill Nash, president and chief executive officer of CarMax, the largest retailer of used vehicles in the U.S.
He went on: “As the market leader, we have spent almost thirty years building a diversified business that can profitably navigate the ups and downs of the used car industry. We believe we are well positioned to effectively manage through this cycle.”
When someone notes they’ve been in this for decades and will consequently be able to handle what is occurring now, it is clear that it is tough.
In the case of CarMax, compared to Q3 last year:
And so on.
While it is fairly well known that there is an affordability problem in the new vehicle sales business, CarMax notes that vehicle affordability—as well as inflation, increasing interest rates and low consumer confidence—are having a negative impact on its business, as well.
Things may be improving. But probably not as quickly as buyers and sellers would like.
By Gary S. Vasilash
Analysts from Edmunds, the vehicle shopping research firm, have discerned some clues in the market that they feel bode well for consumers. (They have also found some not-so-good things, like the unlikelihood of getting a lease deal and rising interest rates, but let’s put those things aside.)
Edmunds found that while the average transaction price (ATP) for a new vehicle hit a record high in November, at $47,681, November was the first month since July 2021 that the ATP was below the Manufacturers Suggested Retail Price (MSRP).
The average MSRP in November was $47,696.
So $15 to the consumer’s side of the ledger.
For buyers of large trucks, there was an average save of $1,210.
However, on the other end of the spectrum, compact cars, there was a price $703 higher than the MSRP.
Go big, save big(gish). Go small, pay more.
The ATP for the large truck was $61,076 and that represents a ~2% saving from the MSRP.
The ATP for a compact car was $26,398, or a ~3% premium over the MSRP.
That said, the folks at Edmunds think that if you’ve been waiting for a time to buy, that time might be right now.
By Gary S. Vasilash
Last week Norihiko Shirouzu of Reuters reported “Toyota is considering a reboot of its electric-car strategy to better compete in a booming market it has been slow to enter.”
Toyota’s Prius is synonymous with “hybrid.” The company has pretty much hybridized everything. It argues—or maybe that would be “argued”—that it is better to build a whole bunch of affordable hybrids than a comparatively few electric vehicles that are comparatively more expensive: according to Kelley Blue Book, the average price of an electric vehicle in the U.S. in September was $65,291. The average transaction price for vehicles overall, KBB calculated, was $48,094. Which is roughly a 27% delta, which is certainly non-trivial.
Be that as it may, Shirouzu’s sources indicated that “Toyota’s planning had assumed demand for EVs would not take off for several decades.” Which is decidedly not the case.
So is Toyota making a pivot? That is one of the subjects discussed on this edition of “Autoline After Hours.” Joining “Autoline’s” John McElroy and me are automotive consultant/analyst Jack Keebler and long-time auto journalist, currently freelancing at Autoweek, Todd Lassa.
Other topics discussed are the Q3 earnings of both General Motors and Ford, as well as those companies positions on autonomous driving: GM continues to be bullish on the prospects for Cruise, still anticipating revenue of $1-billion from the operation by 2025; Ford is far more conservative, as it announced that Argo AI, the AV company that was owned primarily by it and Volkswagen (each had 39%), was closing. Ford going forward would focus more on Level 2+ and Level 3 ADAS. (Ford CEO Jim Farley: “It’s mission-critical for Ford to develop great and differentiated L2+ and L3 applications that at the same time make transportation even safer.”)
The conversation is wide ranging and lively. And you can see it here.
The good news for EV enthusiasts (as in those who enthusiastically support the proliferation of EVs not necessarily because of any environmental considerations but simply because (a) they have one and figure that others should, too, or (b) they simply think it is cool tech, and while they can’t afford it—according to KBB.com, EVs had an average retail price of $65,291 in September—they still think it is cool for those who can):
According to Elizabeth Krear, vice president, electric vehicle practice, J.D. Power: “October breaks a three-consecutive month decline in EV consideration.” More people are thinking about getting an EV.
J.D. Power data have it that 27.4% of people who are going to be in the market for a new vehicle in the next 12 months are “very likely” to consider an EV.
While that is a move in the right direction for EV sales, Krear has some other figures that are less propitious:
“Adoption has been flat for the past six months with the retail monthly share for BEVs hovering at 5.6%. The top two reasons for EV rejection are lack of public charging and price.”
As for that all-important price component, she points out that affordability has decreased by 15 points during the past 12 months and the recent rise in interest rates is having an effect, as well.
But the federal EV support money for EV purchases as well as an increase in the number of models (J.D. Power has 51 in its data set; two years ago it contained 27) are at least helping people consider EVs, even though they still might opt for that ICE model.
This seems unlikely.
In reporting its global sales for the first three quarters of 2022 Porsche noted that its ales in China—its largest single market—were down. Only down by one percent, but down.
Still, overall the company is up two percent compared to the same period in 2021.
Sales in North America were also down. By four percent.
So that means the #1 and #2 markets for the sports car manufacturer were down.
The case in China, Porsche said, was largely caused by the COVID-related lockdowns imposed there various times this year.
As for the North America, the company cited logistical challenges.
Turns out that Europe, including the home market in Germany, made the difference.
In Europe minus Germany sales were up 11%, to 42,204.
Germany had a rise of nine percent, to 20,850 vehicles.
China sales were 68,766 units and in North America the number was 56,357.
In total, the company sold 221,512 units.
The electric Taycan deliveries were down by 12%, to 25,452, which Porsche attributes to “supply chain-related bottlenecks and declining parts availability.”
Doesn’t seem all that long ago that the Taycan was really going to take it to Tesla. Even though the Model S, refreshing notwithstanding, is long in the proverbial tooth, doesn’t seem that much of a bite has been taken out of it.
Back in May, Lucid Group, which produces the magnificent Lucid Air line of electric vehicles, thought that it would produce from 12,000 to 14,000 of those vehicles in 2022.
But, as they say, stuff happens.
After delivering 679 vehicles in Q2 it adjusted its guidance to be at 6,000 to 7,000 for the year.
It just announced its Q3 production figures, which had 2,292 vehicles built at its plant in Casa Grande, Arizona.
So far this year it has built 3,697 vehicles.
To reach 6,000 units it would need 2,303 more.
That seems eminently do-able.
While the numbers are small, the Airs start at $87,400 and go north of $249,000.
Bigger numbers would be better. But in that context, small isn’t bad.
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