AAH #638 - The EV Transition: Reality or a Field of Dreams?

Autoline After Hours is brought to you by Bridgedone Tires Solutions for your journey.

Hey everyone, thanks for joining us today. John is not here now.

I know some of you are thinking yourself John's on spring break, but trust me, John is not on spring break. He will be back with us

next week when we'll have as our special guest Sandy Monroe, so be sure to tune in for that show. But you're very lucky because this show is

going to be a fantastic one because I've got three of the smartest guys in the industry to join us today to talk about what's going on in the world of automotives. So let's bring them in. So we have Greg mcgliari,

who is the editor of autoblog in the brand new autoblog Electric. So Greg

autoblog Electric, tell us about it. Thank you, Thanks, it's great

to be back on the show. So autoblog Electric is where you know all

of your latest and greatest electric car news will be. We have a charging

station finder on there, so if you're looking to power up your electric car, we could help you out with that. And we have some you know,

electric car buying resources on there too, So plus we have a snazzy new logo which I think is it looks pretty sharp. It's very important.

So so speaking of things of a graphic nature, and we have Chris Poker who is the director of video for Edmonds. So so, Chris, I

mean when people think about Edmonds, maybe they think about doing a research of cars and things like that. So what is the video component that you bring

to the party here. So that's a great question, and we're really looking

at video is sort of the welcome Matt to get in a new audience.

People have come to Edmonds for literal decades to configure cars and get leads to dealers and to read the latest reviews. We're looking at video. It's an

opportunity not only to go through comparison tests and to really show off our testing expertise, but also to have a bit more fun and loosen up a little bit. Great. Great, and last, but not least, we have

Matt de Lorenzo, who is a long time automotive journalists and most recently the author of and I hope you can see this. It is how to Buy

an Affordable Electric Car and the subtitle is a tight Watts Got Tight Wads Guide to ev ownership. Now it's very rude to, you know, quibble,

quibble with one's guest. But I've got to say, having read the book,

that this this subtitle is completely wrong. It should not be a tight

wads guide. It should be a sensible guide. So um, Matt,

welcome to the show. Tell us about what you're trying to accomplish with this

book. Well, I don't want to overspend on cars. I never did

in my life. I came to that realization after driving all sorts of different

stuff for forty five years. And I went out after I left KBB,

and I said, well, I got to buy a car, and I wanted an electric and I thought about buying any golf and then I ended up buying a brand new Nissan Leave the cheapest one. And going through that experience

and just seeing how different it is to own an electric vehicle. I wanted

to share that information with other people because it isn't the same as owning a gas car. There there are a lot of different There are a lot of

pluses and there are minuses, and I think if you're going to make the transition, you should be well prepared to know what those differences are and be prepared to accommodate things like getting a level two charger in your home. Uh,

you know what the differences are in insurance rates, what the differences are in maintenance. So that's basically kind of the synthesis of the book itself.

So and I self pub it and it's been out since last summer and showing how much the world changes quickly in the EV space. I've already had to

revise it to reflect the new tax laws and new models coming to the market.

Under forty thousand dollars, We're going to see more and more of those vehicles. That's that's my big beef right now, is that all the evs

we seem to be talking about are with any decent range or fifty thousand dollars and up. And what I want to do is let people know that there

are some less expensive vehicles there, but they're going to come at the expense of some range in convenience. So we're going to get to all of that.

And I had planned to open the show with something else, but big news happened today and I think we got to start with this that GM announced that it is quote working to permanently bring down structural costs, and it's going to do so by offering its salary and salaried employees in the United States buyouts.

Now, these these employees get to decide by March twenty fourth of whether they're going to take the package or not, and if they take it, they leave by June thirtieth. Now, General Motors is in the process of

trying to cut two billion dollars of costs. I mean overall, it's not

just these people that they're talking about it. And last month it announced it

was cutting five hundred salary jobs around the world. So you know, you

have this this new offer to the fifty eight thousand salaried employees that are in the United States. Now, last month there were five hundred, so you

know that's the five hundred about one percent. Ford last month announce it's cutting

eight it's cutting thirty eight hundred people in product development and administration in Europe over the next three years as it is working to cut its costs. Now,

I put it to you, guys, are these companies making these drastic cuts because of the billions of dollars they're spending on making electric vehicles? I would

say that's certainly a Factorum the R and D process has been you know, fiendishly expensive and you know, famously so for a very long time already, and there's a lot of corporate learnings that happen, and obviously the manufacturing process tends to be a lot more simplified and so you need fewer people. Um.

But I think they're also just looking at the larger economic headwindsum that basically are we're facing here and leaning out. You know, they've they've got answer

to Wall Street. Yeah, I think we're at a point right now where

there's just so much economic uncertainty with you know, the supply chain, with inflation. Car companies in subways are thinking like they're trying to get ahead of

what could be perhaps you know, a bigger downturn. I think there's sort

of you know, ten fifteen years ago, when we were going through like a different it seems like the companies were being more reactive, and now it seems like themo is to train and get out in front of it. You

know, you might say, well, you know, they're doing quite well in this area or in that area, do they really need to do that, But you know, it seems to be like they're they're being offensive if you will, as far as going after cuts and bell tightening before, maybe they absolutely have to. I think it's a it's a it's a huge gamble

on their part, and I think they're betting on evs and I think that if they let all these people go, and they let a lot of institutional memory go with it, that they're setting themselves up for a huge failure down the road. That if if the market does not make this tectonic shift to

electric vehicles, they're essentially going to be out of business. And they're seeding

the market to the Koreans, to Toyota. It's a lot of healthy companies

by you know, by trying to make this whole sale change. So I

don't you know, I see in the larger picture that it's a it's a it's a huge gamble that just may not pay off. It'll it'll help mollify

Wall Street and short term, but I think long term vision in terms of being an industry leader, they're thrown in the towel. So so so let

me let me dig into that a little bit. Matt Um. So you're

suggesting that they're taking the people that know how to build and develop internal combustion engine powered type vehicles and saying thanks for the memories and we're moving ahead into the future, and that there's somehow going to suddenly start making some serious money on evs. I think that's their bet. I mean, that's their I

think that's their hope. I don't know where all you know, and I

can't speak to their internal figures or anything where they come up with how many people they really need to get get rid of. But I would prefer to

see more targeted cuts rather than this across the board because they're going to lose a lot of really good people. And to be fair, we don't know

exactly how targeted those cuts are or aren't you know they're they're offering packages to specific people, right, Um, it sounded like everybody, Oh, is that right? I apologize that part. Um, that is a risk then

for sure. UM. I think the other thing that's happening is we're seeing

a lot of automakers walk away from different segments in the market as it becomes more and more expensive to transition to evis um. And you know, when

that that happens, you have the cure needs for development, you know, if your needs for product line um, you know, for production and all of that. Look at the exodus from passenger cars UM and you know,

granted EVISUM have ridden ramping up with airty botle lines there, and obviously stevs continue to ramp up, but trucks have largely stayed. You know, maybe

they're adding one model that sort of thing, but they've lost a lot of different model lines in the process, and so you've probably created some redundancy through that process. But you know, Matt, it was interesting that, you

know, mentioning that they're they're seating part of their market to Toyota and Hondai and Kia and Honda and so on. Um. You know, it explained

that a little bit more. Well. I think if you look at the

product lines Toyota has, they're all in on everything, trucks, cars, passenger cars, hybrids, plug in hybrids, hydrogen. I don't think they're

singularly focused, and I think that they're they're willing to go where the market's going to take them. And even though the Koreans are kind of saying,

you know, we're gonna we're gonna electrify, and they still have a broad enough product family that they too can go where the market takes them. But

if you're just going to say, well, we're not going to build gas cars anymore, what does that leave you with. I think we've seen the

domestics perhaps start to gamble a little bit more in the areas of electrification and you know, to kind of build on what Matt said there, but just in general, for like decades, General Motors and Ford were among the most conservative companies in the US industry in any sector. And then you know,

if you look at how Ford has decided to literally under Jim Farley's leadership, break out the company into like ice vehicles and then evs and then even try to start to extrapolate some like financial and earnings data from that. You know,

that's that's a very significant change for them after how they had done business the previous one hundred and twenty or so years. And then if you look

at General Motors, I think it was about five six years ago, they just pulled out of Europe. They said, we can't make money here,

We've never been able to make money, we're leaving, and they gave up like hundreds of thousands of units. That's something that under like an old General

Motors business model, they never would have done because they valued the title of world's largest automaker, which they had since nineteen thirty one. So I think

it's interesting how risky. You know, it's a theme we've had here in

this kind of roundtable. You know, Ford to General Motors in particular,

have gotten with some of their business strategies. And then you know, to

bring like the third member of the Detroit three into it into this, you know, Chrysler is always i mean different ownerships, different you know, mergers.

I mean, they've always been almost like a case study in you know, different approaches to business management. So in some ways it's kind of interesting

that at the moment they're kind of the most reactionary of the Detroit three.

I wouldn't have said that. You know, if you think back to the

days of like Leia Coca and Bob Lutz and how that company used to be run. Chris, You're you're in town then when there was the days of

of Lutz and Iya Cooca and so on. I mean, do you do

you see the current regime at what is now? Um, you know FCA,

North America, Stilantis being more gunshy as it were. Um, I

don't know if they're gun shy or if they just have fewer chips to play.

Um, they just don't have the same amount of resources. And they

have so many brands now, um, you know, with the acquisition of Opal and all the other things, like it's it's just a crazy number of mouths to feed. Um. I've always said that Chrysler or whatever you want

to call it now Stilantists always did its best work when it's back was up against the rope I you know, I call them the rope a dope bottomaker because that's when they got like really clever and stretching the K car platform eighty different ways and coming up with the minivan or whatever, the sort of uh, you know, genre defining product that the lex cars were mentioned earlier.

Um, when they get desperate, they hungry and they get marked m But you know, for a long time now they've been trading on you know, big engine superchargers, h you know, testosterone, and that's a hard transition to make to the world of electrification. They're they're you know, moving in

some really interesting ways with what they've shown us in terms of concepts and seemed to be production cars and trying to imbuse some of the character and the noise and frankly the imperfections of internal combusting cars because that's what really equates to personality in a lot of way. So they've got to be on a different journey

than some of the other automakers. You know, I just read a piece

by John McElroy, was it where he talked about who where he talked about the profit margins, and Chrysler has the highest profit margin of the Detroit three and they're pretty close to Tesla in terms of just there. You know then

that they were running like, I don't know it was into like the sixteen percent range something like that. So, you know, I think going slow

right now in a market that isn't as far down the road in this transition probably isn't a bad strategy. You said, if you can, if you

can make money in this environment, especially when we face these uncertain times, you're going to be a better position to come out the other end, I think than just saying I'm I'm betting on twenty thirty five right now. You

know, you know, I thought there was interesting. Um So switching back

to Ford, and you know, Greg mentioned that, you know, Ford split itself in half, and so there's model e which is doing all the ev high tech sort of things. And then there's Ford Blue, which is

basically the rest of the company powered by internal combustion. And so Ford makes

this announcement about how it's going to be adding capacity because the vehicles it has are so much in demand. The only executives that they quote is kum Alcohol

who runs Ford Blue, which was curious, and they you know, the big headline that seemed to come out of it was the fact that they're going to be taking Mocke production must saying moche production up to two hundred and ten thousand by the end of the year. But also within that announcement was the

fact that they're adding eighty eight thousand unit capacity to the Broncos Sport and Maverick.

Now you know, the Maverick has a has A has A A hybrid version, but basically they're both internal combustion engine cars. So I started thinking

about that and I looked at the numbers to see how well these various vehicles did last year. Okay, so the Broncos Sport they sold ninety nine,

five hundred and forty seven, the Maverick they sold seventy four thousand, three hundred and seventy. The Mocke they sold thirty nine thousand, four hundred and

fifty eight. So I mean the delta between these these gasle Lean products and

you know, in one would argue that things like the Maverick and the the Bronco sport are in demand. I mean, they're not things that people have

to be you know, bludgeoned into buying. Are just doing incredibly well.

And it's just like, why are these guys only talking about the importance of their Moki or or even the Lightning. Lightning last year had sales of fifteen

thousand and six and seventeen. I mean, they've been capacity constrained on certain

things. They've been supplier issues. Um, the markups on I don't know

if you've looked on Mavericks and still on you know, the full sized Bronco are obscene, and the way periods of scene they've you know, they've already basically closed the reservation processes for effectively the next year for both of those models.

So the demand is there, The margins are there on those products, I would think, especially on the Bronco. I'm not entirely sure about Maverick

UM, but it's not a very When you're trying to position yourself as a tech company that's moving towards electrification, it's not particularly sexy to spend a lot of time talking about the thing that's actually paying your bills, which is a lot of those vehicles. Yeah. Yeah, I mean the Bronco one hundred

and thirty seven thousand, three hundred and seventy and again a gasoline powered vehicle.

So and they could have sold probably tens of thousands more if they could only make them. So. So does this get back to um what you're

talking about, Matt, about taking your eye off of the thing that is paying the bills. Yeah. I think right now, there's so much emphasis

on Wall Street and on government, and everybody forgets the other leg of the stool is a consumer. And if they're not there yet, the stool's going

to topple. And they're not there yet, it's it's going to be a

long, slow process. There's still a lot of affordability issues, and I

think that until you know the next solid state battery or breakthrough, which always seems to be two or three years away, comes through, there's there's no beating a gas car for affordability. Convenience, ease of use. You know,

I'm working on something where I'm saying, you know, if people had to have the same considerations in buying a gas car that they have to buy an electric car, they wouldn't be buying gas cars. You know. The

thing is you would be buying your car based on how big the gas tank was. You know, if your entry level car only went one hundred and

fifty miles on a tank of gas, would you be that interested in that car? So it's it's it's different, you know, it's it's it's a

different beast, and I just don't think the public is there yet. Well,

so what I was going to start off with with I read an interesting thing that Bloomberg NAF came out with that it said that peak internal combustion engine was twenty seventeen. And this is on a global basis, that eighty six

million ICE vehicles were sold in twenty seventeen, and all plugins we're about a million, okay, And for twenty twenty two, ICE is down twenty percent to sixty nine million units, and plugins of all types are up, so they represent a ten point four percent of the market. So okay, if

you're somebody who is sitting in in Dearborn or Stuttgart or Tokyo and you read that, how do you, with good conscience not push more chips onto the EV side of the business. I'm curious to know what portion of that is

China, you know. I mean, if you look at how hard they've

pivoted it's and how large of a market that is, that strikes me as a significant portion of that change just that one country, right I kind of wonder too about just the last few years if you look at twenty seventeen, eighteen nineteen, you know, I wonder if just the changes that have impacted society, you know, like you know, the pandemic for example, just how much that may have just thrown off normal carbuying trends and put it put

us into a space where maybe it'll take a couple of years to kind of like reset kind of level set, and then maybe we could get a better read, if you will, on where evs stand and how automakers can try to adjust consumer demand to that. I agree with Chris. I think China

is an important element because of the number of vehicles that are sold there, and that could distort the picture somewhere. The other interesting thing I see is

the pushback in Europe right now. Um, you know, Germany's pushing back

big time on the vote the band ice vehicles in Europe. So until a

lot of that stuff shakes off, the you know, shakes out, the internal combustions death is greatly exaggerated at this point. And that's the other thing

too. I mean, even moving back to GM, the fact that they've

that they're going to do the next gen small block push rod motor speaks to where the future really is. And and so I don't know, it's it's

not a it's not a done deal that we're going all electric by twenty thirty or twenty thirty five, like a lot of people are are predicting. At

this point. I think it's a long way from a done deal. Um,

But I would say that everybody has some interest in the narrative that that's where we're going, whether that's politicians, you know, outside of the base that really just you know, from my cold dead hands, you know, I'm gonna have my diesel. Um. The automakers have an interest in that

to prove that they are forward thinking and they're not the ecological boogieman and all of that. UM. While in the background, the thing that's powering these

companies is the F one fifty and the you know round fifteen hundred, their economic engines, and and that will continue to be the case for the foreseeable future. UM. And that's okay, it's just it's it's tougher to talk

about UM. And again, those mandates about banning ices, and most of

the time they're done by politicians that won't even be politicians by the time those come home to roost, and they'll you know, they're page one top, you know, above the fold stories and newspapers and websites, and then by the time it rolls around that they're getting pushed to the side. Then they're

you know, section C or the equivalent online. So so met you you

know, you're talking about the new pushrod engine that General Motors is in the process developing, and you're saying that that is the future. I mean,

that's that's heresy, that's that's that's crazy, that's a crazy talk. I

mean, the altium battery is what this is all about. It. Yeah,

so, so how how dare you say that? Explain? I know,

well, I think uh, to Chris. Chris's point, that's where

the money's coming from right now, and that's what you need to stay in business. I mean, that's the bottom line, is that you've got to

have sales and you've got got to get there. I'm not naysaying electric vehicles.

I own one. I love them. I think I think if they

hit twenty twenty five percent of the market, um, they're going to be that's a huge success for them. And I think they have a role to

play in the vehicle fleet. It's not it's not the silver bullet, panacea

answer that everybody is painting it to be. And I think we're going to

see a blend of vehicles. Plug in hybrids are very smart vehicles. Regular

hybrids get fent plastic mileage. You know the fact that a priest can go

sixty miles on a gallon That was unheard of even five or ten years ago, that you could get a gas car that could perform that way. So

electrification is going to be a very important part of the future. It's just

it's not going to be battery electric only. You know, it's going to

be fuel cells. There's going to be gas, there's going to be hydrogen,

burning cars. I'm excited. I think there's gonna be a lot of

really different things to look at and evaluate and find a vehicle that fits your particular need. So Greg does does Matt need to be burned at the stake

with electricity? By the staff of autoblog electric we would just probably zap them

with you know, our blitt zappos. You know that that could work.

Yeah. I think it's interesting you bring up like the different use cases,

and I think that's you know, I've kind of lived that life in the last like probably six weeks, like the three different press cars I've been in.

Is a plug in hybrid BMW three thirty E is what they call it.

It really rolls off the tongue. I was charging that thing NonStop and

filling it up NonStop because there was like a nine gallon gas tank. And

then I had our EV six, which is awesome. I really enjoy the

keya EV six. It was the North American SUV of the year. Great

vehicle, but I actually was a little redis to take it on a road trip because there's not all that many like chargers in the middle of the state of Michigan. Let's put it that way. Or the middle of most states.

So it's great to fill it up in suburban Detroit or power it up, but once you get out to like Pass Lansing, for example, you're in trouble, you know. And now I'm in the Toyota Siena hybrid minivan,

which is not a plug in, It's just a straight up hybrid.

It's got a pretty big gas tank. I love getting in this thing and

seeing a fuel range or a total range of five hundred miles not even thinking about, you know, going to a gas tank or gas station or a charger for the first time. And you know, probably November when I was

driving like a Yukon that had a huge tank. So I do think it's

a fair point to say, hey, like pure evs are not going to work for every single person. You know, there's depending on where you live,

depending on you know, the type of vehicle you need. It's it's

going to be a challenge for you, you know. I I'm very bullish

on evs. I like, I'm not a tech person, if you will,

Like I still take most of my notes in a like a dot journal, if you will. But when it comes to charging in ev I really

geek out. I think it's fun. I'm sitting there on my phone staring

at the charge point app, like really looking at the kill a lot of hours that are ripping through the you know, the car. So you know,

it's I wouldn't say it's not for everybody, but there's definitely, you know, a time and a place where evs do work better for others.

And that's just the reality. You know. I think we're actually we've we've

reached a sort of a reckoning point. There's enough critical mass of people that

know people that own evs around the country, and they're they're learning both the great things about them and the problems about them, and most of them are centered really on the charging experience. You know, Greg, you nailed it.

That's that's really the thing. And even here in Los Angeles, I

have to tell you, you know, this is theoretically best case scenario here, and you know, in Silicon Valley, the state of the public charging network is terrible. The reliability, the uptime is just dismal. The rates

are all over the place, UM, the availabilities all over the place.

The uh, you know, the apps that you have to use, there's somebody hoops to jump through. UM. It's just difficult if you don't have

the ability to charge at home. And I think people are starting to realize

that. Um, you know, the exception I always point out as Tesla

the supercharger network is the best charger network going, and it's not close.

Um. But obviously they recently opened up their charging work to some small degree

presumably to be you know, to a larger degree in the future, in order to get access to some federal funds. Whether that dilutes the availability and

appeal of their network they're uptime, that's going to be kind of interesting to watch if that dilutes brand appeal for them, because everybody's got to mix with the Hoi polloi and you know, their lightnings and what happen will be interesting to see. But I also think we're having a more nuanced conversation. We

got really excited by the crazy performance figures that Tesla's and GMC hummery vs We're putting out, and then everybody's like, well, wait a minute, how much is this damage is this doing to our roads? Because these things weigh

nine thousand pounds and how you know, how are we getting these rare you know, metals and how many PREUSS batteries could these power? And I think

we're starting to see more people asking more of those questions, which is healthy.

Yeah, I agree with you Chris too, like sort of a healthy conversation, like the informed debate is what's going to actually move the electric vehicle conversation forward, you know. Right now it seems like like everything people really

come at it from, you know, whatever team they're on or what they've owned in the past, and like, you know, there's a lot of hot takes going out there. And to me, having covered the industry and

like I enjoy cars, I enjoy all different kinds of cars. To me,

there's a level of frustration there because it's like, let's look at the car and its merits and look at the situation and try to figure out, you know, how it can work. You know, you could be an

EV supporter and also talk about you know, the downsides of them, you know, and I think that's how we're going to really reach some solutions, you know. Like I, like I said, I really enjoyed my experience

in the EV six, but I also was like, man, it's twenty eight degrees and I'm sitting here agatting, like forty kilo odd hours, you know, trying to juice it up under what's allegedly a DC fast charger.

Like it's a good story, it's a good part of the experience. So

I mean, it's I think it's important to try to like examine how these you know, different electrified things, especially the infrastructure can play in different different places. All Right, So so we're gonna have to take a quick break

for our friends from Bridgetone. We'll be back. We'll have more on this

and we'll be talking about prices, we'll be talking about companies, and we'll be talking a whole lot more about electric vehicles. So we'll be back.

How do Bridge don't hire stop shorter? On what roads? Is there hydrotrack

technology? But you don't have to know how the science works, just where

the brain is. What really matters is they're bridgetone and we are back.

Um, you know it's interesting. Um, Greg you're talking about the charging

experience, and Chris you're talking about how LA doesn't have a great charging experience as well. And our colleague Joanne Muller, she's with Axios now and she

recently took a road trip that she drove and I believe it was an EB six to Florida and back. And she just earlier this week on her newsletter

Axios What's Next, talked about how she and her husband are ready to drive basically from Kentucky up by seventy five to Detroit and it's it's absolutely unbelievable to me what those two had to go through to get home. And it took

like hours more because the weather changed and the temperature went down and electric vehicles don't like cold, and I mean, and so so basically, you know, the heaters is and you know, it's just it's just so many things.

So I mean, is this responsibility of OEMs or is this the responsibility of you know, the free market to be able to build out this this infrastructure. I mean, you know the mention of Tesla, I mean,

the only reason that they're opening their supercharger is not because you know, they have some some great warm feeling toward the public. It's just like basically,

yeah, they're gonna get money from the government if they do that. Yeah,

yeah, yeah. I mean, let's let's be clear about this,

Um, we don't have the national will to create a charging structure that's you know, mandated by the government. That's that's funded by the government, UM,

by our tax dollars. We're not set up for that. Our country

doesn't want to invest in that kind of thing right now. UM. And

countries that do that are you know that like China are gonna pull demand ahead for the entire world because they have such a need for somebody evs and because automakers here have to design their product portfolio for North America in you know, with China also in mind, because they you know, they sell a ton of cars over there. That's going to be difficult. So whether or not

we choose to really get into EVS here or if we want to hold on to our gas cars, there's there's a pole factor from other economies that are making the transition a lot more quickly that's going to make this a bumpy road for us. I think if you were a car company or a startup just

other company in general looking for the next great area of demand, building a great charging network would be an awesome idea. If you want to be like

the next Thomas Edison Henry Ford. You know, this is the area that

has problems, it needs solving. So if you could find a company or

create a company that could do that, you would really be entering like a white space to use a bed ciche buzz were there that would solve problems for companies, for consumers, and frankly the government, you know, because really if you look at it, it seems like the federal government is really the only single entity that you know, has the money to do something like this.

Is there currently the like the collective will of the people to do it?

Maybe maybe not. You know, I think Chris is you know this

is in the ballpark on that one. I think, you know, past

precedent, you know, we have done things like this. You know,

if you look at the public works programs under like FDR, or if you look at the interstate highway programs under Eisenhower, like this has happened here in the past. So you know, if there were the will of you know,

the voters, the people to do it, it's it's certainly possible.

But absent that, I mean, if you want to be the next Elon Musk, come up with an next great charging company, and you would really be solving a big problem. Okay, So so I've I've immediately turned to

my new bible, which is how to buy an affordable electric Car, and I turned to this chapter and I would do this on autoblog Electric except for I'm using the internet now to see you guys, so I can't I can't look there. But so I find here how to find public charging, and

I find Blink charge Point, Electrify America, ev Connect, ev Gateway, ev Go, Flow, FPL, Evolution, Francis Energy, Green Lots, Livingstone Energy Group, OPI Connect, Power, Flux, seem to Connect, Volta, and of course Tesla. Okay, so there's a whole bunch of

companies. But you know, if you look at the JD Power surveys that

are about you know, people satisfaction with with charging, it's like horrible and I mean and if you know, we all complain about gas stations having dirty bathrooms, well, but you know nobody complains about filling up their tanks.

Right. Well, the process is the same. You know, you walk

up, you are there, you know, put your credit card into your app it or maybe crazy idea use cash, but it's it's it's a simple process. It's something we're well versed and it doesn't take that long. With

EVIS and with all the different charging networks, we have a million different apps um, we don't always have you know, the easy uh you know payment process that goes along with that, and a lot of the time, frankly, they don't work with these third party charging networks and that's that's really frustrating to people and understandably so. And then you take into account, you know,

the fact that you're going to be there for longer, so what amenities or or do you feel safe where you are? Um, these are things

we just generally don't think about with gas very often. So that's why like

charging at home, if you can charge at home, you know, evs are a wonderful solution for I would say the vast majority of Americans, whether they realize it or not, because then you just take that out of the equation altogether. I had a friend of mine who he's on his second niece

on Leaf and he bought it because he wanted to quit smoking. And the

reason why that was he was always going to the gas station. That was

when he naturally gravitated towards buying smokes, you know, and like just taking that part of his life out of the equation and just plugging it at home, he's you know, recovered time, he's recovered lung capacity or whatever, like it's his life is better. Um. But if you don't have that

ability and you live in an apartment complex and they're not putting in chargers or whatever, or you know, the prime grocery store that you go to all the time doesn't have chargers that work that are available frequently, It's it's tough.

M man. Oh go ahead, No, I was gonna say you

you've looked into this whole at home charging thing, and um, yeah, it strikes me as being either expensive or complicated or both. Uh it really

isn't you know. Again, it just depends on the type of setup and

whether or not you're a tight one. In my case and Kelli Fornia,

everybody's garage is essentially or not everybody's, but most people's garages are also their laundry room, so you do have a lot of two forty outlets for dryers and things like that. I have a gas dryer, but I also have

a two forty outlet. So it was only a three prong thirty amp,

and my leaf came with a four prong fifty amp, so I had to go on Amazon and spend thirty five dollars for an adapter. And since it

only pulls twenty six ams, I'm good. I plug into the wall and

I have level two charging. I didn't have to have an electrician come out

and spend five hundred bucks. I didn't have to buy a two thousand dollars

level two charger. So it's not as big a barrier as as people think.

In terms of doing it, I will say some manufacturers are cheap and out and not giving you the portable charge cord like I got with my leaf that was good for both one, twenty and forty. Um. Those are

the kinds of issues and the Chris's point at home charging is a solution.

The larger thing about the infrastructure. I mean, the only reason Testa is

still in business today is the fact that they have the supercharger network. And

I think that manufacturers themselves have to be more proactive um in involving themselves in that part of the equation. They just can't leave it up to other people

like they did to the oil companies back when the industry was growing. Um.

They're you know, if they want to sell more electric vehicles, they got to make sure that people have a way to recharge them. Um.

The Electrify Americas and the ev goes charge point. They're trying as hard as

they can, but they're you know, Mercedes now is talking about doing their own network, So, um, you know, I think that isn't isn't Mercedes talking about with an existing charging company. Yeah, they made their own

branded but I but again, you need more outlets and you need more they need to be working. I mean, I think that's the most important part

of that JD. Powers study. Isn't so much that I can't find a

charger, it's I can't find a charger that works, and you know, until they can get that sort of reliability and um, so that you're not thinking about that. I mean everybody talks about range anxiety. I think charge

anxiety is a much bigger issue than range anxiety. Is where am I going

to plug this thing in? You know? Electrifying America though is basically Volkswagen,

right, I mean that's where where the money can and they're behind it.

So if you know one of the global car companies has a problem solving this, um, well, I you know, I think I think the difference is so that Tess understood that they needed to sustain their charging network, to sustain their business. I think Electrify America with VW they put two billion

dollars in to kind of get the diesel Gate scandal behind them, and I think they they kind of went, Okay, got that one done, and they're letting Electrify America carry the ball from here on out. I don't see

any ongoing commitment on their part or on the part of any other manufacturers to really support these charging companies other than oh, yeah, we have an app with charge Point or we'll give you a card to use an ev go thing.

They got to step up big time in order to make it work.

And and if they don't, their ev sales could collapse because people are going to say, I can't you know, this thing isn't usable. I'm not

going to be able to find a public charging station. Especially also the people

who live like a lot of people still live apartments and condos and they don't have access to you know, private charging or their their own charging. So

h that's an issue that needs to be confronted. A gas car you can

sell to anybody. Electric car that's so much. So we've we've talked around

this a little bit, and we've got to talk about Tesla like as everybody likes when we talk about Tesla, So we got to talk about Tesla.

So the company announced price reductions for the Models and the Model X from four to nine percent reductions. In January, it cut prices for the Models three

and Y from six to twenty percent. Now, for the Model three and

the Model Why, it was probably a play to make more of its vehicles qualify for the Inflation Reduction Act money, because otherwise it'd be too expensive.

They wouldn't qualify. But you know, the the S and X will not

qualify even with these ductions because the X starts at ninety nine nine zero and the S at eighty nine ninety. Um. What is going on at Tesla?

I mean, they're they're they're losing a lot of money here, it seems, I would say they're they're, you know, sacrificing money on the table. They've got, you know, pretty tremendous margins because of the way

they manufactured their vehicles. Obviously, they've you know, benefited handsomely from being

able to sell credits and all of that. That's kept them sustained for so

long. Um. And you know, I'm a Tesla skeptic in a lot

of areas. But one of the things that they do very well UM on

one level is build a vehicle with you know, fewer castings and all of that, rationalize that production process, slim down the number of variants that you have that lowers costs. I don't think they actually get the finer points very

well in terms of build quality UM and some of the materials that they use.

But they they make money on their cars UM, and that wasn't always the case, and so they have more flexibility that way they can put pressure on people. But it's also you know, those are really all vehicles at

this point UM, and even with facelifts, and you know, they're constant Ota updates, they're old vehicles, and they're they're under new pressure. You

know, there's new competition now UM, and so they've they've got to you know, restart the conversation with people UM and make those cuts. Maybe they're

feeling some pressure from that and and they're watching their sales flag their inventory you know, potential climb a little bit. But we're also you know, cognizant

the fact that they're not a brand that changes pricing once a year. Next

month, it could be you know, plus twenty thousand dollars, Like we have no idea, just kind of depends on you know, which way, you know, Eland got out of bed in the morning. It's it's hard

to tell them. So I was wondering about that, I mean, how

how is it? I mean, so you know, in this industry,

prices are basically set, and then you know, there would be incentives that would that would shift, that would that would modify the amount of money that someone would pay for a car. But but basically, you know, um,

it was it was still somewhat predictable. I mean, Chris to your

point of like he just suddenly decides I'm gonna give him a four percent cut or I'm gonna give hi an eight percent. How does how does the normal

industry react to that? The normal industry is reacted by quietly starting to adopt

that model of changing prices a lot. We're seeing a lot more small price

increases here and there throughout the course of the area that nobody even realizes.

And then we're also seeing companies come in with like super low price vehicles.

Remember the Maverick was under twenty thousand dollars and it's like nineteen nine starting price on the Maverick. Now it's like twenty four and change something in that range.

Look at what how many price increases of lightning has gotten um And so they're dangling that cure at that an incredibly low price. And make no mistake,

those are unbelievably low prices. And now they're more realistic, I think,

you know, to the point where they can make some margins. But

what we're seeing is, you know, they're falling in line. Whether they

want to talk about it or not, they're being more willing to change their prices up and down. So so, Greg, do you think things like

a thirty thousand dollars equinox is a one of the types of vehicles that Chris just mentioned, something that is there for but a brief fleeting moment and then poof. You know, I think that's sort of almost like the historical precedent

throughout the industry. You know, you look at like different You remember the

first thirty thousand dollars or sub thirty thousand dollars Mercedes, what was that, the celt whatever it was CLA and how long was it under thirty thousand dollars?

You know, so I think we've seen sort of the legacy automakers do that for a while, but when Tesla does it, you know, hey, that's that's big, that's national news. So you know, I think

that's a huge challenge that needs to there definitely needs to be more transparency in the pricing. Um. You know, you look at the Bolt. When

it first came out, it was thirty nine thousand dollars. They lost the

ability to offer the seventy five hundred dollars tax credit, the price dropped the thirty one thousand, then they dropped the price again, and now they're offering a twenty six thousand dollars version with the and they're eligible again for the seventy five hundred dollars tax credit. I was surprised they didn't boost the price up

again to kind of recoup some of that that money they gave away. So

it's just right now, I really feel for people who want to get into the electric vehicle market at the entry level. It's absolutely a mess right now.

And that Inflation Reduction Act is to blame because it went from you know, before the tax credits were just there to try to get electrics in the people's hands. Now it's there as a means to reward certain companies punish other

companies, and then also some sort of well you know, if you make more than one hundred and fifty thousand dollars a year, you don't get the credit. And so it's the government policy isn't doing anything to promote EV sales.

It's being done on a different level to either reward manufacturers or punish other manufacturers for where they build their cars, where they get their minerals, and where they get their battery backs. So let me let me ask you guys

to chime in on some of the startup EV companies in terms of what you think about what they're what they've accomplished, or what they will accomplish, where they're going, or whether they'll exist. So um, you know, full

disclosure, we were all NACTROY jurors and we all had to vote on the Truck of the Year last year, and one of the Trucks of the Year nominees last year was the Lordstown Endurance. Matt, what do you think about

the future of Lordstown in general, and maybe the Endurance as a subset of that, or the first part of your question will answer the second part.

Well. Their business model to begin with was the fact that it was going

to be a fleet vehicle primarily, and the pricing and all this other stuff, so you know, it's an interesting vehicle. I actually drove pretty well.

I was fairly impressed with the build quality and all that. But from

my own personal perspective, and I have in my book a little thing about you know, if you want an affordable ev my word about pickup trucks is don't bother because they're going to be way too expensive and they just don't do what pickups are supposed to do, which is hauled a lot of stuff and tow things. They're just not suited for it. And everybody's discovered that with

the lightning, So I'm I wouldn't. I'm not putting a lot of chips

on lord Stone at this point, Greg So, I thought the truck itself was pretty credible. I like driving it. They have a pretty interesting like

the way the hub motors are in the wheels. You don't see that very

much in the car business, at least not recently. You know, I

think they actually have a they have a defined business model, let me put it that way. Fleets, different design, interesting sort of you know,

propulsion system and like very basic but you know, very acceptable interior. So

I thought the product is is there, it's workable, it's a work in progress, that's on the right track. As far as their business plan,

as far as the company, it's been a bit of a roller coaster last couple of years. That's a tough one to predict. Let me put it

that way, you know, fifty fifty. Maybe it's just you look at

some of these automakers, whether it's the original Fisker, you know, to like the Lucids, to you know, the new Fisker, it's tough.

Especially I believe they got their money via like a spack, which it seems like that can be. It seems like those are maybe going out of you

know, out of being cool, let's put it that way. So I

think it's uncertain for them, Let's put it that way, even though the product is decent. All right, Chris, so go beyond the magic eight

ball of future unclear. UM. I'm more pessimistic UM, And it almost

has very little to do with how good that product is. UM, just

simply because you know, I think that for a lot of these companies, UM, they came out, you know, with their product announcements, and they had potentially good ideas. You had balling jer and it was going to

do you know a bare bones you know, um ev and off road and that was a market segment that was untapped. And you know, you could

make an argument that that's the same is true for Lordstown. UM. The

problem is that they didn't get to market before a lot of more mainstream products like the lightning and they you know, um, they won't be out there in volume before a lot of players are going to kind of eat their lunch.

That the companies that can get um, the batteries and the supplies, that the parts and stuff at a much you know, more favorable rate because they're they're ordering those parts uh in much higher quantities and they can put the squeeze on the little guy. UM. So I'm less optimistic, especially for

companies that aren't on the gate already obviously, UM the stock prices of companies like Rivan and Least that have already had several rounds of great reckonings and they're probably not done, but at least they're you know, they have products that are out of the market, UM that people can un over there, and they have some unique features to them. UM. And and some real merit.

But if you're just getting going and you don't have the backing of a major automaker or some other type of business UM that already has tons of cash, I would be very suspicious that they would be around in five years.

Well, so, so you mentioned you mentioned both Rivian and lucid UM.

You know what's interesting about both of those companies is that both have giant manufacturing facilities UM. And you know, we're not seeing giant manufacturing numbers the same

way we're seeing giant manufacturing numbers that Tesla, for example, has been able to show UM. You know, there seems to be some question about UM,

you know, the viability you know going forward of both of those companies.

Who has some ideas about either of them? Well, I think UM,

they have big profit march and they sell to a luxury market, but they're going to be limited in volume. You know, Mercedes doesn't sell very

many S classes to begin with, and they're not going to sell a lot of of the the eq s or those types of cars yet. You know,

the volume market is the Model three in the model uh, the model why for for Tesla and none of those. You know, Rivian certainly isn't

going to be there, and I don't think Lucid has any intention of offering you know, a sub sixty thousand dollars cars, so I wouldn't I wouldn't count to see any mass market coming from startups. I think the mass market

stuff are going to come from the established, the established players. I do

think they will have those products filter in, but they're just having product problems building the cars that they already have in market right um Rivian still has a huge weightlift and they just can't get their production processes together to get the volume out that they need to. And they're following the model that Tesla did,

where you launch with an expensive product. Um you know, you do your

duh, you know, mortizing of costs and all of that up there, and then you roll out cheaper products and you'll see the same thing happen.

Provided those too, you know, survive and thrive, they will fill out their model ranges. What's interesting is somebody like um, you know, like

Fisker, where they're already talking about models that are like thirty thousand dollars within a handful of beers. I don't know that they'll actually get there, but

that's a that's a different approach to the market. I tend to favor what

Rivian and Lucid are doing. I think there's just been more of a reckoning

around the value of companies like this. And then, you know, obviously

there's been the supply constraints all over the place, and frankly, in my experience, as lovely as it is to drive a listed are or I want to see build qualities out there yet and obviously tests was forgiven for that right up until present day. Actually I couldn't even say it for years because they

still have the issues um and those cars are just frankly not well built.

We have long term ones that we own that we bought and paid for with the company's money. They're not as well built as a normal luxury car from

an established automaker. They have all kinds of little niggles here, and they're

they're wonderful to drive, they're beautiful to have, you know, really clever solutions, especially the Rivium UM, but they're not making money on them yet.

They can't build them at scale yet and they have to solve that before they get to anything else. You know, this this makes me wonder.

I mean to go to go back to the very beginning when we were talking about General Motor is getting rid of the uh, the salary employees and Matt, you know, you were mentioning about their losing a lot of institutional knowledge.

So it seems to me that, you know, one of the things we lose sight of is in an electric vehicle is at the end of the day, still a vehicle. It's still a car, trucker, an suv.

And so you take the powertrain out, you know, you still have the interior, you still have a suspension system, you know, you have lots of things that there are lots of people who work at places like General Motors have been doing all their lives. I mean, might this not be

an opportunity for the likes of Lucid and Rivian in Lordstown for that matter, to get these smart people who know how to do the you know, the blocking and tackling of the auto industry. Yeah, I think I think that's

spot on. But the thing is that it costs money. That's why they're

getting rid of those people, is that they cost money, and a lot of these startups don't have that kind of money to support what it needs to really build a car and I think that point was underscored when we were driving the Car of the Year entries this year, is that when you got into an electric vehicle that came from an established carmaker, you could tell a difference.

You know. One of my favorite vehicles was the G eighty Electric.

That was a luxury car, was well screwed together. It was a beautiful,

beautiful car, really well executed, and that comes from the fact that they build millions of cars, so there's no replacing that expertise. But also

that expertise does not come without a great expense. Yeah, it's definitely a

balancing act because I think, you know, one of the reasons I talked about, you know, the way that Tesla builds cars now, with the huge castings and the things, the decisions that they've made that have actually driven the entire industry, like just the removal of switch gear and cars. Maybe

some of that was going to naturally happen because computing and you know, got better, and touch screens got cheaper and all of that, but they've really pushed the industry toward minimization of switch gear and that costs the things associated with that um and they've been able to reap much thicker margins as a result of all that. It's taken some time, but on a per unit basis,

Tesla is profitable in a way, you know, in segments that I think you know, established automakers couldn't do. So the question is, is you

know you're one hundred percent correct Matt that the institutional knowledge is hugely important.

And I think frankly, Tesla and others could have benefited from saying like, well, you can't build it that way because of this, this and this, and they just weren't willing to listen to that. But also probably there's

there's the flip side of it where it curbs innovation because there are people saying there, well you can't build cars because of this, this and this, and then somebody comes in and proves them wrong. All right, So so

for the for the final thing, and I want I want a quick answer from each of you. Okay, so we do this show five years from

now, will we be talking about internal combustion engines at all? Or will

they just be a quaint curiosity? Matt? Your first yes or no?

Yes, they won't be They won't be quaint curiosity, will still be still be talking about them. Oh yeah, Greg, Okay, yes, that's

that's not that far in the future. I think we'll still be talking about

them for sure. Chris. Just just say they're wrong and they're wrong,

and they'll just all be electric vehicles. They'll be the majority of the market

internal combustion. So we'll definitely be talking about it. It won't even be

close five years, all right, that's not even a model cycle. Come

on, ten years, still be talking about it, do you guys?

Are years? Definitely? Yeah, So the future is evidently not now,

all right, So all right Matthew Lorns Okay, so where can people get this? This this wonderful book? Uh Amazon dot com, Barnes and Noble

dot com, please buy it? And and Greg, where where can people

find autoblog electric? That's autoblog dot com slash electric dash vehicles and Chris and

Edmunds dot com. Yeah, and uh Greg, it'll always be autoblog green

to me. It served us well. And but hey, the future is

we're saying the futures now, we're saying the futures electric now. We're not

gonna wait ten twelve years, all right. For those who don't know Chris,

once upon a time worked at Autoblog, so we've we've got to have have that disclosure. You know. It's sort of amazing. You know.

I was looking at at you know, all the places you guys have worked, and it is like the three of you guys, if you added up all the cars you've driven, it would be like you'd need hundreds of normal people to get even a fraction of your combined expertise. It's it's really quite

amazing. So thank you for your your service to appreciate. Thank you.

It's a fun business, okay, So okay everyone, so thanks for joining us, and we'll see it here next week. Autoline After Hours is brought

to you by Bridgetone Tires Solutions for your journey. If you liked this program,

I would like to learn more about the automotive industry. Check out our

website at Autoline dot tv, or look for us on YouTube on the Auto Line channel

AAH #638 - The EV Transition: Reality or a Field of Dreams?

Dodge Charger

Dodge Journey

Ford Maverick

Ford Broncos Sport

Ford Bronco

Chevrolet Suburban

Toyota Siena

Gmc Hummery

Tesla Model X

About this episode

Original notes