Tag Archives: electric vehicles

Hybrids Still Matter

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By Gary S. Vasilash

Japanese car shoppers are going to buy more hybrids in 2024—more than half of all sales will be the electrified powertrains—than any other type of propulsion system, according to Bloomberg Intelligence.

Tatsuo Yoshida, Bloomberg Intelligence senior auto analyst, said:

“In Japan, hybrids are popular because they’re affordable and reliable, since they don’t rely on the existence of strong charging infrastructure.”

Arguably, those same characteristics—affordability, reliability, and no dependence on the availability of electric chargers (at home or out in the world)—are important to consumers everywhere.

2024 Toyota Prius: Looks good. Travels far. (Image: Toyota)

Although Honda had a hybrid in the U.S. market, the Insight, before Toyota brought the Prius, it was literally just a matter of months—Insight December 1999; Prius June 2000—and Toyota has really become more associated with hybrid technology thanks to its persistence in bringing out hybrids, both as powertrain options to vehicles (e.g., the hybrid RAV4) and as hybrid-only offerings (e.g., the Toyota Venza).

In Japan Toyota has had the Prius available since 1997, so the vehicle, and hybrid tech, are certainly familiar to consumers there.

While the Prius design over the years transitioned from something frumpy to something that looked like the designers were spending too much time watching anime, the 2024 Prius, the fifth generation of the model, is absolutely stunning in looks and certainly not lacking in its efficient performance: the top-of-the-line XLE and Limited models with AWD offer fuel economy of 49 mpg city, 50 mpg highway, and 49 mpg combined. For those who have more frugality, there’s the LE FWD version which is rated at 57/56/57 mpg, which means that given its 11.3-gallon fuel tank (and it takes regular gasoline) it can travel some 640 miles on a tank. That is the definition of “convenience.”

(The 2024 Prius was named the MotorTrend Car of the Year and it is a finalist for the North American Car of the Year, which will be announced January 4.)

Hybrids are garnering more attention in the U.S. market. Not as much as in Japan, but more.

The Ford Maverick Hybrid continues to be a massive hit.

And when Ram brings out its Ramcharger Ram 1500 variant next year, although it will probably emphasize that it is an “electric vehicle,” it is really a hybrid (a series hybrid: there is a battery that powers the electric motor; when the battery gets close to depletion, the gasoline engine operates as a generator to recharge the battery, to keep the propulsion going).

And at an Automotive Press Association Q&A late last month, GM CEO Mary Barra acknowledged that the company has hybrid tech in its portfolio, even though it has no hybrids on offer in the U.S. market.

Arguably, if more Americans knew about the ease of using a hybrid and the efficiency the vehicles provide, they, too, would buy more of them.

Perhaps this will happen when the 2025 Toyota Camry is launched.

The Camry, the perennial best-selling car in the U.S., will be available only with a hybrid powertrain. Clearly, Toyota is that confident in the tech. (Of course, having been putting hybrids under hoods for more than a quarter of a century, it ought to be.)

Affordability, reliability, and no dependence on the availability of electric chargers.

This may cause consumers to pay more attention to hybrids in the U.S., too.

You Can Reserve an Acura MDX EV Right Now

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By Gary S. Vasilash

Although it is widely known that Acura is late to the proverbial electric vehicle party, it announced today that reservations are now open for its forthcoming ZDX crossover, which is available as an A-Spec (single-motor, RWD; dual-motor AWD) or as a Type S (dual-motor, AWD, ~500 hp) vehicle.

The 2024 Acura ZDX: coming to a dealership near you (well, assuming you know where an Acura dealership is) sometime next Spring. They say. (Image: Acura)

So it is getting closer, as close as Spring 2024 for those who put down a $1,000 reservation fee. . .but given that the ZDX is based on the GM Ultium platform, there could be some minor or major delivery delays, given that the Ultium track record to date is not exactly confidence-inspiring.

The A-Spec models are said to be “Starting in the range of $60,000” and the Type S offering “Starting in the range of $70,000,” so the vehicles both of which are offered with a 102 kWh battery, don’t have particularly surprising price points.

That is, the Acura MDX has a starting MSRP of $49,850 and makes its way to $73,500.

Acura has always been premium, so for the money it tends to be a good value.

Often better than good.

So maybe it will be late, but it has the right body style for selling EVs, and a handsome body style out of its LA studio (which is undoubtedly surrounded by EVs from various and sundry OEMs, established, burgeoning, trying, and Tesla).

Let’s just hope the ZDX isn’t really late.

It’s not that the party will be over. It will be that people will have all selected their party hats vehicles and so the number Acura will be able to move will be less than it might be thought and there won’t be a whole lot of popping the cork.

Tesla and the Rental Fleets

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By Gary S. Vasilash

One of the things that rental companies do—besides trying to get you to buy all manner of insurance and making you feel marginally criminal and totally liable if you don’t—is sell vehicles from their fleets in order to get an even better ROI.

Hertz, back in 2021, announced that it was going to make a massive investment in electrifying its fleet, with the purchase of some 100,000 Teslas. A few months later it upped the amperage and further announced 65,000 Polestars would be included in lots at airports around the country.

But it seems that the company is rethinking its approach for a couple of reasons.

One of which has to do with the price reductions that Tesla made in order to boost its sales volumes, which had the consequence of putting downward pressure on the residual values of its vehicles. That is, if you buy something for one price and then the same thing is available for a lower price, even before you try to sell your object as used it is worth less than it otherwise would have been.

Hertz CEO Stephen Scherr told The Verge, “The MSRP declines in EVs over the course of 2023, driven primarily by Tesla, have driven the fair market value of our EVs lower compared to last year, such that a salvage creates a larger loss and, therefore, greater burden.”

In addition to which, Hertz discovered that it was costing about twice as much to repair damaged EVs compared to vehicles with internal combustion engines.

“We nonetheless remain committed to our long-term strategy to electrify the fleet,” Scherr also said, which undoubtedly has something to do with the company (1) justifying its initial tranche of EVs and (2) simply positioning itself as a good corporate citizen.

But Hertz isn’t the only rental company rethinking its EV strategy.

Sixt, the German rental company (#2 in Europe; #4 in the U.S.) has decided that as it is electrifying its fleet it is moving away from Tesla and moving toward Chinese OEM BYD.

Again: the residual values and the costly repairs are factors that have played into this move.

While this doesn’t mean that either of these companies are any less interested in electrification, it seems to indicate that their interest in Tesla is waning or disappearing.

EV (Dis)interest

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By Gary S. Vasilash

One of the things that isn’t talked about much is the fact that electric vehicles really aren’t that popular unless they come from Tesla.

Flying in the face of that is a finding of Kelley Blue Book that in Q3 2023 EV sales in the U.S. hit 313,086 units, a 49.8% increase over Q3 2022. Such a jump means interest, right?

Well, the total number of EVs sold in Q3 represents 7.9% of total industry sales.

In other words, 92.1% of the vehicles people bought in Q3 weren’t electric.

And to the point of Tesla’s sway over the market—even though KBB saysTesla’s share of market tumbled to 50%–is that KBB acknowledges“Tesla’s price cuts have moved the market, pushing electric vehicle prices down more than 22% year over year, from $65,295.”

That’s right: a single company moves the entire segment.

(And in case you’re wondering, in October, according to KBB, the average transaction price for an EV was $51,762 while the ATP for a non-lux vehicle was $44,331.)

Drilling down a bit more, it is bracing to discover that in terms of share of the EV segment, the mainstream brands really don’t have much in Q3.

  • Chevrolet, 5.1%
  • Ford, 6.7%
  • GMC, 0.4%
  • Hyundai, 6.3%
  • Kia, 3%
  • Nissan, 1.9%
  • Subaru, 0.9%
  • Toyota, 0.9%
  • VW, 3.4%

And know that the 6.7% for Q3 Ford racked up represents 20,926 vehicles: 14,842 Mach-Es, 3,503 F-150 Lightnings and 2,617 E-Transits.

Ford sold 23,931 Mavericks in Q3, of which 56.5% were hybrids. Somehow that 20,926 EVs sold—encompassing three models, one of which is based on the best-selling pickup Since Time Began—seems more than anemic.

So even before Ford started talking about having to make adjustments as a result of the salary and benefit increases in the proposed agreement with the UAW, the auto company suddenly found things like the F-150 Hybrid more interesting.

When I ask knowledgeable people about the subject, they point out that much of the EV development and promotion is predicated on government regulations, more than organic customer demand. Look at those puny percentages up there, slices of the 313,086 vehicles sold by companies ranging from Audi to Volkswagen.

There’s not much there there.

Yes, there will be more EVs offered. More EVs sold.

But—again, absent Tesla—the market demand isn’t at all what it sounds like it should be.

Another example of this not-big demand is something that some point to as a real success story: the Chevrolet Bolt EV.

Here are the sales figures for the past five years:

  • 2018: 18,019
  • 2019: 16,418
  • 2020: 20,754
  • 2021: 24,828
  • 2022: 38,120

Whoa! you might think. From 2018 to 2022 the sales of the Bolt EV doubled! Remarkable.

But there are a couple of elements that need to be considered.

For one thing, Chevy added a (slightly) different body style, the more ute-like Bolt EUV in 2021, which certainly added some interest to the model(s).

And in June 2022 General Motors cut the price of the Bolt to persuade customers to buy one—sort of like what Elon has been doing.

Had Dodge made a substantial price reduction to the SRT Hellcat Redeye Widebody, the Brotherhood of Muscle would exponentially increase its membership of all genders and municipalities throughout the country would have a sharp uptick in revenues from speeding tickets.

If there is a change in the political situation, those regulations that are driving EV development and sales and those incentives that do the same (what if the government offered $7,500 tax credits for the purchase of a Hellcat?), the question of actual market demand is really going to matter.

Will Minivans Make It Once Again?

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By Gary S. Vasilash

One of the things that isn’t often cited with regard to the forthcoming VW ID. Buzz is that it is a minivan. Yes, an electric minivan. But nonetheless the type of vehicle that has more than its share of people who say they’d never be caught driving one.

In the U.S. market, the brand that really brought the minivan to the market back in 1983, Chrysler, is still there with the Pacifica. There is a plug-in hybrid option available for the Pacifica.

Toyota has the Sienna as a hybrid-only minivan.

And there are the Honda Odyssey and the Kia Carnival, although these are ICE-only (for now, anyway).

Which brings us to what they’re calling an “MVP,” or “multi-purpose vehicle,” but which one glance at its configuration says “minivan”: the Volvo EM90.

Volvo EM90: A minivan by any other name is still. . .a minivan. (Image: Volvo)

Volvo describes it as having an interior design that makes it “your living room on the move.”

For years (hard to imagine that the architecture is 40 years on) minivans have always had the most versatile and capacious interiors among light vehicles.

Will electrification make them more appealing to customers such that people will be boastful, not sheepish, about that comparatively boxy three-row vehicle in the driveway?

One thing about the Volvo EM90, however.

It is being launched in China and there has been no announcement it is going to be available elsewhere.

Perhaps if the ID. Buzz becomes a hit in the U.S. market Volvo may offer the EM90 there, as well.

Perhaps.

The Coming EV Cost Challenge

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By Gary S. Vasilash

B-segment cars are not big in the U.S. Of course, these cars, which are under compacts (e.g., Honda Civic, Toyota Corolla, Hyundai Elantra), are physically small, as in things like the Honda Fit, Toyota Yaris and Hyundai Accent, all of which have departed the scene in the U.S.

However, the B-segment has a solid following in Europe probably not because Europeans just like to wedge themselves into smaller vehicles but because of things like high gasoline prices and parking challenges.

The Boston Consulting Group (BCG) recently performed an analysis of the costs of producing B-segment electric vehicles (EVs) for the European market.

This is apparently quite a challenge, as they found:

“the price difference between a B-segment EV and a similar ICE vehicle is greater than the price differential for other EV and ICE vehicle segments. An analysis of recent French price data found that the average retail price premium on a B-segment EV compared to its ICE counterpart is around 75% (€36,800 vs. €20,900). In the C- and D-segments, the premium is 47% and 11%, respectively.”

People who might be inclined to buy a B-segment EV would likely be disinclined once that price delta is seen at a dealership.

BCG finds that material costs are a big driver, with the material costs for an EV being about 65% higher than the materials for an ICE vehicle.

Batteries play a big role in this.

So as the BCG analysts looked at how prices can be managed, they pointed out, of course, that reduction in battery costs through things like using lithium iron phosphate batteries (LFP) instead of nickel-manganese-cobalt are beneficial.

But there needs to be more done, from reducing the number of vehicle variants to sharing parts across models.

And then there is the manufacturing cost input that must be managed.

The BCG analysts note:

“In the manufacturing realm, restructuring assembly lines to focus solely on producing EVs will automatically lower assembly costs. In both greenfield and brownfield EV plants there are 75% fewer engine preparation and 25% fewer mechanical preparation steps per vehicle compared to ICE factories. This, in turn, improves productivity and factory output while decreasing the number of full-time employees.”

Again, this is about B-segment EVs in Europe.

But it makes one wonder about the recent tentative agreements between the UAW, Ford, GM and Stellantis.

In the BCG model, “decreasing the number of full-time employees” is arguably a positive in that it would reduce costs.

In the new model created by the UAW-OEM negotiators, that is something that is not likely to be realized.

Which could prove to be challenging to the OEMs in the U.S., even when producing much larger EVs.

Faced with competitors who can, this could be rather problematic when pricing those new domestic EV models.

Biden and Belvidere

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“Congratulations to Stellantis and the UAW for their dedication and focus in coming together to reach a hard-won tentative agreement. The significance of this historic achievement coming just days after the UAW and Ford reached an agreement cannot be overstated.

 “This tentative agreement includes a number of important provisions including a commitment to reopen the Belvidere plant in Illinois, which will bring good, union jobs back that community. The parties are also charting a future of good middle-class jobs in battery manufacturing, consistent with the President’s vision for a just transition where building a clean economy and creating good union jobs go hand-in-hand.

 “Today’s agreement demonstrates what is possible when workers have a voice and a seat at the table. On behalf of the most pro-worker, pro-union administration in history, we applaud the parties on what they have achieved.”—Julie A. Su, U.S. Acting Secretary of Labor

A couple of considerations.

  1. What does it matter that there is the self-proclaimed “pro-worker, pro-union administration in history”? Wasn’t this contract worked out by the UAW and Stellantis? How was the Biden Administration involved? One of the points that the UAW used in bargaining was that the Administration is shoveling money into battery plants and while the OEMs can take advantage of that, there was no certainty that the workers would benefit from it, as that wasn’t written into the language of the Fed’s largess, only geography and material sourcing, not worker representation. Pro-labor?
  2. That plant in northern Illinois had been closed earlier this year because the Jeep Cherokee that was built there wasn’t selling. Obviously, making something that someone doesn’t want to buy is not a good idea. (OK: that only a few people want to buy.) According to UAW vice president Rich Boyer, the plant will build a midsize pickup and there will also be jobs at a battery plant in Belvidere. Should that midsize pickup be an electric pickup, given what’s happening in the market right now, that may put the workers back in the situation that had occurred with the Cherokee. EVs are not selling at the rate that had been anticipated, which is causing Ford to cut a shift from its F-150 Lightning production and GM to push back the construction of an EV assembly plant. Seems like more EVs isn’t what’s required at present. However, UAW president Shawn Fain pointed out: “We not only won the right to strike over plant closure, we won the right to strike over product and investment. That means if the company goes back on their word over any of these plans, we can strike the hell out of them.” Stellantis better hope its product planning is on target for Belvidere as well as its other U.S. plants.

Underwhelming Domestic OEM EV Sales

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If you listen to the pronouncements of traditional OEMs about their EV efforts, you’d think that there is probably some sort of parity vis-à-vis their internal combustion engine business.

As in GM (remember: “All in” on EVs) selling plenty of EVs, and the Ford F-150 Lightning being in demand the same way the ICE versions of the truck are.*

So it comes as a surprise how few EVs the traditional OEMs are selling in the U.S.

According to the just-released Kelley Blue Book “Electric Vehicle Sales Report” for Q3, when it comes to General Motors, year-to-date it has sold:

  • 49,531 Chevrolet EVs
  • 5,334 Cadillacs
  • 1,216 GMCs

That’s a total of 56,081 EVs over nine months. If we include Brightdrop commercial vehicle sales, it boosts the number to 56,414.

The GMC HUMMER EV was introduced in October 2020. During the past three years, there have been 2,071 of them sold. (Image: GMC)

GM sold 65,255 Chevy Trax models, or 15,761 more units than sales of the Bolt EV/Bolt EUV sold through Q3.

Meanwhile, over at Ford:

  • 46,671

To put that in perspective: during the first three quarters of 2023 it sold 56,427 of its giant Expedition SUVs. So the Mustang Mach-E, Lightning and E-Transit commercial van summed are nearly 10,000 fewer.

And while adding things together: GM and Ford combined sold 103,085 electric vehicles.

Meanwhile, according to KBB Tesla sold 493,513 EVs.

Think about that: two of the biggest, most legendary OEMs in the U.S. together sold about a fifth of a company that was established 20 years ago.

*To be fair, Stellantis brands (Chrysler, Dodge, Jeep) sold 0 EVs.

What Do Potential EV Pickup Buyers Think?

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By Gary S. Vasilash

It is always interesting to see surveys that ask about how people perceive autonomous vehicles because most people have only seen an AV on TV.

Things are a bit better with electric vehicles. But still, if you take Tesla out of the calculations (in the first half of 2023 Kelley Blue Book calculates that there were 556,707 EVs sold in the U.S., of which 336,892, or 60% of the total were Teslas), there aren’t all that many EVs out there for people to buy.

Cox Automotive (which, incidentally, owns KBB) recently ran a study of pickup shoppers who are planning to buy a truck within the next two years.

The information related to those considering EV pickups is interesting.

For example, consideration for an EV from a brand that one already owns is solid, which perhaps help explain why the Ford F-150 Lightning has the highest level of consideration.

What’s more, Cox found Lightning is clearly the most appealing to people.

Ford F-150 Lightning frunk. (Image: Ford)

When asked about appeal before a truck was revealed and consideration after the reveal, of the Ram 1500 REV, Chevy Silverado EV, GMC Hummer EV pickup, Rivian R1T, and Tesla Cybertruck, and the Lightning, only the Lightning had a higher post-reveal consideration number.

And when looked at from the perspective of the following metrics, the Lightning got the top score in all of them:

  • Mileage range/fuel efficiency
  • Driving performance
  • Price
  • Overall look/styling
  • Technologically advanced

Which brings us back to the aforementioned survey about AVs.

Of the vehicles on the list, only the Lightning, Rivian R1T, and Hummer EV pickup are out there, and the number of Hummers is capable of being parked in a strip mall lot with spaces to spare.

How do people know about driving performance?

And how does the Lightning, with a top range of 320 miles, out score the Silverado EV, which has an estimated range of 450 miles?

When it comes to technology, it is hard to figure how the Lightning is more advanced than the R1T—unless it is that the Lightning has a 14.1-cubic foot frunk and the R1T’s is just 11.

Return of the Acura ZDX: Why Bring Back That Name?

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By Gary S. Vasilash

One of the things that Japanese OEMs do that American OEMs tend not to is to recognize when something isn’t working and then moving on.

There isn’t a tendency to say, “Gee, maybe if we add some exterior trim and increase the amount of stitching on the seats people will buy it.”

Rather, the vehicle goes out of production.

Case in point is the Acura ZDX. It lasted from model years 2010 to 2013.

The vehicle design was something of an amalgam of a car and an SUV. It has a fast sloping roofline such that people who were trying to get into the back seat could get a nice bump on the head. And there is a sharp backward-angled cutline for the rear door which helped with the awkwardness.

Acura had made much of the vehicle prior to launch, given that it was something that it hoped would have the success of something like the MDX, which is was then and is now unmistakably an SUV.

But the so-called “Luxury Four-Door Sports Coupe” simply didn’t appeal to anyone, so it went away.

Oddly, Acura has brought back the ZDX moniker for the electric SUV that was officially debuted today at Monterey Car Week.

2024 Acura ZDX Type S. (Image: Acura)

It will be available with a standard single motor in the entry A-Spec and with a dual motor setup in the sportier Type S. The former will produce an estimated 340 hp, a 325-mile range and a starting price of around $60K. The latter will produce 500 hp, have a 288-mile range and start at some $70K.

On the subject of the “increased styling and packaging freedom EVs offer,” Dave Marek, Acura Executive Creative Director, said, “Embracing that creative liberation, our team was energized designing ZDX, Acura’s new modern expression of performance.”

To be sure, the vehicle is far more fetching than the other vehicle that carried the name.

Which makes one wonder why the previous name was brought back.

Sure, Acura reselected the name “Integra.” But unlike the original ZDX, the Integra was a success in the market.