Why 2030 Isn’t Going to Be All That Different from 2020

Yes, there will be more electric vehicles. But not all EVs. So internal combustion engines need improvement.

By Gary S. Vasilash

Bosch, Sujit Jain, president, Powertrain Solutions for Passenger Cars, Commercial & Off-Road, and Electric Vehicles at the company’s North American operations, points out, has been advancing—and producing—technologies for the auto industry essentially for as long as there has been an auto industry.

And today isn’t any different.

The company is not only making massive investments for developing and utilizing Industry 4.0 capabilities, but it is investing heavily in the development and production of everything from microprocessors and fuel cells in order to advance the functionalities and performance in the auto industry.

It is committed to the electrification of vehicles, whether this makes the form of hybrids, full battery electrics or fuel cell powered vehicles.

But while Jain says company projections have it that the number of battery electric vehicles in the U.S. will grow from about 2% of the market in 2020 to 30% by 2030, that still leaves 70%, the large percentage of being combustion engines. Yes, they may be hybrids, but there is still gasoline or diesel being burned.

So one of the things that Jain and his colleagues are doing is developing the ways and means to increase the efficiency of those engines, both in terms of performance and emissions reduction.

Some of the things that they are pursing, Jain says on this edition of “Autoline After Hours,” include synthetic fuels, electrically heated catalysts to reduce cold-start emissions, and hydrogen fuel injection (i.e., instead of a hydrogen fuel cell, this would be a combustion engine running on hydrogen).

Jain talks with “Autoline’s” John McElroy, Kelsey Mays of Cars.com, and me on this show.

After Jain’s segment, the three of us talk about a variety of subjects, including former Nikola head Trevor Milton being charged with three counts of criminal fraud related to the company he founded; Tesla’s Q2 financials ($1.14-billion in GAAP net income), the possible consequences of it opening up its charging network to other brands, and the move from upscale-shopping districts for its stores and galleries to lower-end real estate; Magna’s growth and technological breadth; and more.

And you can see it all here.

Tesla Q2 ‘21

If it hadn’t last $2-million on Bitcoin, the number would have been bigger

By Gary S. Vasilash

A few things from Tesla Q2 numbers

Consider this:

Models S/X production numbers were:

  • Q2 2020:      6,326
  • Q3 2020:      16,992
  • Q4 2020:      16,097
  • Q1 2021:      0
  • Q2 2021:      2,340

Were they not electric vehicles, the phrase “running out of gas” comes to mind.

To be fair to the people in the Tesla plants, for the Models 3/Y:

  • Q1 2021:      180,338
  • Q2 2021:      204,084

So they’re certainly busy.

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Here’s an interesting understatement:

“Solving full autonomy is a difficult engineering challenge in which we continue to believe can only be solved through the collection of large, real-world datasets and cutting edge AI.”

The emphasis on the dataset comes from the more than one-million Teslas the company is collecting data from.

However, there are plenty of companies that believe that in addition to the critical datasets there is a need for a sensor suite on the vehicles in order to assure that the real world is discerned by the vehicle in real time.

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The company also stated in its report to shareholders, “Public sentiment and support for electric vehicles seems to be at a never-before-seen inflection point. We continue to work hard to drive down costs and increase our rate of production to make electric vehicles accessible to as many people as possible.”

Presumably much of this growing support among the public is predicated on the availability of EVs from OEMs other than Tesla. Vehicles like the Audi e-tron and the Mustang Mach-E.

That last phrase—“accessible to as many people as possible”—seems to echo what Mary Barra has been saying for some time.  At the Aspen Ideas Festival in June Barra said, “As we move to an all-electric, zero-emissions future, it is on us to lead positive change and implement inclusive solutions that bring everyone along, especially our employees and communities.”

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So here’s a question: Is it possible that its Q2 net income of $1.1-billion, its largest-ever quarterly profit, notwithstanding, Tesla is coming from behind for a change?

Behind in terms of the development of automated driving, as it tries not to use an array of sensors.

Behind in terms of having vehicles that come at a price point that are more affordable?

As for the first, the need for things like LiDAR seem clear.

As for the second, time will tell whether companies like Volkswagen and GM are truly going to give Tesla a run for its money on the closer-to-entry end of the EV market.

The Emerging EV Challenge

Incumbents will gain some share. But it is going to take a lot of work to get it

By Gary S. Vasilash

When GM announced its sales for the first half of 2021, the Chevrolet Bolt EV and the new variant the Bolt EUV did quite well. Comparatively speaking.

That is, sales were up 142.4% compared with the first half of 2020.

Of course, 2020 was the COVID year, so the sales of pretty much every vehicle has shown robust signs of sales, but few with such a high percentage rise.

That said, the total number of sales for the two models in the first half of 2021 was 20,288. To put that number into context, realize that the company sold 31,886 Malibus during the same period—and that represented a decline of 33.5% for the stalwart sedan.

And to put the Bolt EV/EUV sales into context, know that in the second quarter alone of 2021 Tesla delivered 199,360 Model 3 and Model Y units—or looked at another way, Tesla sold in three months 179,072 more vehicles than Chevrolet did in six months.

“IONIQ 5 introduces the Hyundai brand to a while new set of buyers, Jose Munoz ,president and CEO, Hyundai Motor America, said of the forthcoming EV. Buyers matter. Especially new ones. (Image: Hyundai)

General Motors has a lot of commitment to EVs going forward, In November 2020 it announced that it would have 30 new EVs on the global market by 2025, of which two-thirds would be available in North America. Then in June 2021 it announced it was adding commercial trucks to the North American mix, as well as additional EV production capacity.

In the GM boilerplate it describes itself as “a global company focused on advancing an all-electric future that is inclusive and accessible to all.”

Last week Mercedes announced its all-EV approach by 2030.

But presumably this is not a plan that is “inclusive and accessible to all.”

Also last week GM announced a recall of 2017-2019 Bolt EVs. A problem with the vehicles potentially bursting into flames.

This is the second time these models have been subject to a recall, with the first being in November 2020.

The new GM EVs that are on the way will not have the same battery system used by the Bolt EV and Bolt EUV. It is an all-new design.

However, GM is not exactly in a position to make that as a benefit of the new vehicles because it would throw some serious shade on the Bolts.

Perhaps the limited sales of the Bolts works in GM’s favor because if the number of recalled vehicles was larger, if there were more people aware of the problem, then it would have even more work ahead of it trying to convince people that it, too, can make EVs with the best of them.

It is widely known that Tesla owners give Tesla a pass in a way that traditional OEMs have never gotten, nor will they. If there are manufacturing defects, shrug. If there are performance problems, shrug. If owners learn of those who are using the so-called “Autopilot” system and run into the side of a semi, a moment of silence followed by a shrug.

If any of these things are related to a traditional OEM: Wailing and gnashing of teeth by the customer base—and that’s just the start.

To be sure there will be more people buying EVs from the traditional brands. While in some cases it may be because the vehicles look damn good—Audi is certainly staking a claim in the design space—in more cases it will probably be predicated on the availability that can come from volume: not only availability in terms of the vehicles being on lots, but availability in terms of economies of scale helping reduce prices.

But given the delta between Model 3/Y sales and Chevy Bolt EV/EUV sales, I can’t help but think that the traditional OEMs may have a bigger problem on their hands than they might expect.

Although Hyundai has certainly been in the U.S. market since 1986, arguably it is still a challenger brand in the market compared to those that have been around for 100 years or more.

While its sales numbers are still modest in the U.S. vis-à-vis the established players, in the first half it sold 407,135 vehicles, or 49% more than it did in the first half of 2020.

Hyundai has been offering hybrids, EVs and even fuel cell vehicles in a way that many traditional OEMs don’t match.

So let’s say for the sake of argument that the same people who buy Samsung phones rather than iPhones would be more likely to go with a Hyundai than a Chevy. (If we go back to the aforementioned design advantage, Hyundai is certainly proved that point.)

So a chunk of the traditional goes there.

Then there are the new entrants. Lucid. Fisker. Lucid is staring at a high price point (think of it as a Cadillac competitor) and Fisker is more in the middle. Both of those companies have announced that they are working on what could be described as vehicles that are more inclusive and accessible.

While it might seem that the incumbents have the advantage simply because of their name recognition and availability, IBM doesn’t make PCs; when’s the last time you bought an image-related product from Kodak; and although a Pan Am shuttle took people to a space station in 2001: A Space Odyssey, Pan Am went out of business in 1991.

Why OEMs Build EVs and Other Things You Think You Know That Probably Aren’t the Case

A lively discussion of things from why Americans don’t buy small, cheap cars and why OEMs aren’t likely to get a big revenue stream from sending data to vehicle head-units

By Gary S. Vasilash

Although there is a whole lot of development going on in the electric vehicle (EV) space, as OEMs announce products and plans with what seems to border on giddiness, maybe things aren’t what they seem.

Consider, for one example, the F-150 Lightning reveal. While it might seem as though every person on your street is likely to replace their gasoline-powered F-150 with an electric one as soon as is practical (even though there is a starting MSRP of $40,000, and even though $40,000 is pretty much the average cost of a vehicle, it is still $40,000), even though people are touting the frunk that will allow them to fill it up with ice and beverages and the power outlets that will permit the audio equipment to be plugged in for parties and picnics, when you listen to Eric Noble, founder and president of The Car Lab, what seems to be the case may not be the case.

The F-150 Lightning in what is a natural environment: a work site. (Image: Ford)

That is, Noble points out that largely because of EV batteries—“They are expensive, huge, very heavy and don’t store very much energy”—especially the cost part, OEMs don’t make money on EVs unless these EVs are priced so highly that the cost of the battery can be buried in the MSRP.

Noble argues that because of the zero-emissions mandate of California and the other states that follow California’s lead in emissions regulations, OEMs that want to sell vehicles in those states—including vehicles with a 5.0-liter V8 under the hood—need to sell zero-emissions vehicles: EVs.

What is the number on the sales forecasts that OEMs have for EVs, he rhetorically asks.

Pretty much what the number of EVs required by the ZEV states are for that particular OEM.

However, he points out that there could be some real business for OEMs when it comes to selling to fleets. (“Ford is good at fleets,” Noble says.)

In other words, Teslas and Mustang Mach Es notwithstanding (and I don’t know whether the champagne need be busted out for the Mach E quite yet because in April Ford sold 1,951 Mach Es and 8,000 regular Mustangs), things like the Lightning are likely to be more oriented toward places where they can do the OEM the most good, which very well may be in fleet applications.

Noble talks about this on this edition of “Autoline After Hours.” And many of his arguments are bolstered by observations by Sam Fiorani, vice president of Global Vehicle Forecasting, AutoForecast Solutions.

Also on the table are other subjects of the moment, like over-the-air updates (not likely to be a revenue stream for OEMs because customers don’t want to have a monthly charge to their credit cards, why tech companies won’t become auto companies and vice versa, and a whole lot more.

Per usual, “Autoline’s” John McElroy and I are engaged in the conversation with these guests, and it is one of the livelier discussions you are like to see about the state of the industry—the reality versus the proclamations.

And you can see it here.

And How Do Others Compete With That?

Tesla signifies more than an electric vehicle. . .

“Many consumers perceive Tesla as a leading-edge, high tech, environmentally progressive brand driven by a charismatic leader who not only builds cars and crossovers, but also sends rockets into space and is a global industrial visionary. That combination is hard to beat and has gotten the attention of the entire global auto industry.”  –Tom Libby, associate director, automotive industry analysis, IHS Markit 

Here’s something to consider: there are about 880 Mercedes dealerships in the U.S.—and just some 130 Tesla outlets (Image: IHS Markit)

Does Tueor Technologies Have a Better Idea for Vehicle Control Systems?

Although one of the claimed benefits of the Digital Current System (DCS) developed by Tueor Technologies is that it is “hack-proof,” what is possibly more compelling is that according to Dan Greene, chief operations officer for the company, is that it eliminates from 80 to 90% of the wiring needed for a vehicle’s electrical control system.

Just one loop of coaxial cable. It carries power. It carries data. It combines grounding and feedback.

There is a master control node running the system. There are sensor nodes, switching nodes and slave nodes. Each of the nodes has a varying level of intelligence, from obtaining information to essentially doing a single task, such as locking and unlocking a door.

Tueor’s simple, safe system. (Image: Tueor Technology)

Should the cable break, the DCS keeps working, Greene says.

The unhackability is predicated on the fact that it is a closed system and should there be an update necessary—over-the-air or otherwise—it cannot be loaded into a vehicle system unless there is explicit permission given by the owner. And to prevent something non-desirable from piggybacking onto a valid update, Greene says a check-sum system can be setup so if something is supposed to be X and it is seen to be X + 1, then it will not be permitted to load into the system.

According to Greene, Tueor began its work on the system to address the ability to hack medical devices like pacemakers and insulin pumps. Then they moved on to satellites. Then to military vehicles, working with AM General on the Stryker armored vehicle.

Auto application?

Not yet.

Seems that OEMs and suppliers are not engaging with the Tueor team.

Greene and his colleague John Dinkel talk about the DCS on “Autoline After Hours” to “Autoline’s” John McElroy; Henry Payne, auto critic for the Detroit News; and me.

Then John, Henry and I discuss a number of subjects, with a particular focus on electric vehicles, as Henry is an enthusiastic owner of a Tesla Model 3 and as on the day of the show GM’s Mary Barra announced that the corporation plans to be carbon-neutral in both its operations and products by 2040. Part of that undertaking includes “an aspiration to eliminate tailpipe emissions from new light-duty vehicles by 2035,” which means an increase in the number of vehicles it puts on the road that don’t have internal combustion engines but possibly frunks under the hoods.

We talk about innovation and corporate cultures. And a whole lot more.

All of which can be seen right here.

Sandy Munro on Tesla, Three-Wheelers and Flying Vehicles

From a functional and executional standpoint, there is probably no one who is more well versed in Tesla than Sandy Munro, who established the lean design, engineering and manufacturing consultancy, Munro & Associates in 1988. The teardowns and analyses that he and his colleagues have performed on Tesla models have become the stuff of grist for the never-stopping mill that is a phenomenon since the vehicles started rolling out of the Fremont, California factory. Has there been an auto company’s products that has garnered more attention? It seems unlikely.

Obviously, once a vehicle has been completely disassembled and assessed, it isn’t the sort of thing in which it is possible to take for a ride.

Arcimoto three-wheeler. (Image: Arcimoto)

So on this edition of “Autolline After Hours” Munro talks about how he has acquired another Model 3. . .and this time he and company president Cory Steuben are going to take it on a road trip, where they will make a determination of everything from how the battery works in the winter of the upper Midwest to the heat of the southwest to how hands-off the Tesla FSD (full-self driving computer system) actually is.

In addition to which, Munro talks to “Autoline’s” John McElroy, “Autoline’s” West Coast correspondent Chase Drum and me about what he sees as what is likely to become a growing automotive trend: three-wheel vehicles, like the products developed by Aptera Motors and Arcimoto. Munro explains that these electric vehicles are highly efficient and enjoyable to drive.

What’s more, a couple days before the show GM’s Mary Barra, in a presentation for CES, revealed a concept, the Cadillac Halo, an electric powered, four-rotor VTOL craft. Munro, who has also done extensive work on aircraft, thinks that there is likely to be a proliferation of personal aircraft for commuting.

While this might seem to be something that will be happening in the Jetson’s future, Munro anticipates such transformations in transportation in a matter of years—a few, not many.

And about that Tesla test drive: Munro says that he’ll also take the opportunity to. . .eat a lot of hamburgers.

And you can see it—the show, not the burgers—here.–gsv

Tesla 2020: The Numbers

509,737. Let’s call it what it is: that is a highly respectable production number for calendar year 2020, the number of Models S, X, 3 and why produced by Tesla.

Tesla doesn’t break down the numbers by specific models.

Rather, it reports it this way:

Model S/X:   54,805

Model 3/Y:    454,932

A lot of cars.

ooo

Tesla doesn’t break out where the vehicles are built. Its Giga Shanghai is building the Model 3 and Model Y production is anticipated (if not occurring). The plant is said to have a capacity of 250,000 vehicles a year.

So it could be that given that the Tesla plant in Fremont, California, is building all four models, perhaps a considerable number of the Model 3/Y are being produced in Shanghai. (After all, there are those 54,805 that had to be manufactured.)

ooo

Tesla is credited with doing things that traditional OEMs have not done. (Not the least of which is selling electric vehicles at volume.)

In that reporting of 2020 production it is doing something traditional OEMs have not done:

Reporting based on platforms.

That is, the S/X share a platform. The 3/Y share a platform.

So rather than separating the volumes, it is aggregating the platforms.

ooo

There is a number set of numbers Tesla reported for the year: deliveries.

So while it produced 509,737 vehicles, it delivered 499,550.

Obviously, a number of those vehicles are in transit. Or sitting on lots (not dealer lots, per se).

Tesla shorts will also argue that there are probably a non-trivial being held back for post-production fixes.

Which may be the case.

Which is doing something traditional OEMs have done.

Will Apple Get into the Automobile Business?

Although it is no secret that Apple had been operating a secret “Project Titan,” which was imagined to be its electric—and probably (at least semi-) autonomous—vehicle program, although it was said to have been disbanded, although it was said to be restarted after Doug Field was rehired, a Reuters’ report has gotten legions of Apple fanboys—to say nothing of the investment community—giddier than they already are when it comes to all things Apple.

The vehicle is back, it seems. Launch date: 2024.

Could this happen?

Apple CEO Tim Cook. (Image: Apple)

If so, they’d better start rethinking the Genius Bar and figure out how to install hydraulic lifts in the back of the stores.

As Elon Musk discovered—and it should be pointed out that he has Tweeted that he once wanted to sell out to Apple but couldn’t get a meeting with Apple CEO Tim Cook—building cars is hard.

And this is a challenge whether you’re a long-time manufacturer or someone who has just started within the past few years, trying to take advantage of the “simpler” production requirements of an electric vehicle, compared to one that has an internal combustion engine.

However, as Darren Palmer, global director, Battery Electric Vehicles, a Ford recently told me, “80% of a car is not the drivetrain.” Meaning that it is a challenge to make sures the doors fit, the plastic materials on the inside have consistent coloring, the fascias don’t fall off. And on and on.

Yes, hard.

Apple doesn’t manufacture its products. That is done for it by companies including Hon Hai Precision Industry (a.k.a., Foxconn), Wistron, Pegatron and so on.

So the likelihood of it building its own vehicles is non-existent.

It would have to work with a company that knows how to make things.

In the auto industry there are companies like Magna, which produces vehicles for companies including BMW, Mercedes, Toyota and Jaguar—and for Jaguar it manufacturers the electric i-Pace. Magna has recently entered into an agreement with Fisker. It is working on the engineering of the Fisker Ocean right now and will be performing the manufacturing when it is ready to go.

What’s interesting about Magna is that most people have no idea that it has manufactured so many vehicles.

That is the kind of company that Apple would need to work with.

It knows that building cars is hard (you can see an interview with Magna’s just-retired CEO Don Walker here, where he talks about how tough the task is). It knows how to build them with the highest levels of quality. And it does so while remaining discrete.

Let’s face it: It is one thing if someone has a problem with an iPhone that bends as it shouldn’t or a battery that doesn’t have the life it should and it would be something else entirely were that to be a full-size car or SUV.

Will Project Titan come to fruition?

If it does, Tim Cook will have his hands full. Just ask Elon.