Electric Cars Cast Growing Shadow on Profits

Electric cars are poised to arrive en masse in European showrooms after years of hyped concept-car launches and billions in investment by automakers and suppliers. The hard part is selling them at a profit as consumers resist paying more for electrified vehicles - forcing carmakers to sell them at a bigger loss to meet emissions goals. 
 

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Also concerning is the fact that EVs are forecasted to account for 7% of car sales in China in the month of December this year, which indicates that China will achieve its goal of 10% of cars sold in 2019 being EVs.

Add to that the impending launch of autonomous car services (Waymo later this year, GM in 2019) and you've got your peak oil demand for 2020 !

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EV's are coming! Tesla paved the way - now the legacy car makers are dumping billions into investing into ev's. More demand more competition - we'll quickly see the prices of these vehicles drop. With each carmaker offering it's economic ev model up to it's top performing ev models. 

2 hours ago, JunoTen said:

Also concerning is the fact that EVs are forecasted to account for 7% of car sales in China in the month of December this year, which indicates that China will achieve its goal of 10% of cars sold in 2019 being EVs.

Add to that the impending launch of autonomous car services (Waymo later this year, GM in 2019) and you've got your peak oil demand for 2020 !

You bring up a good point - I wonder when the switch from owning your own car will cease to exist. You see this in big cities - San Francisco for example - more and more people do not have cars - yes it's limited in space - but uber and lyft are kings in SF.

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You are not going to be able to sell the electric car at a profit and meet the pricing points of the gasoline (or small diesel) engined car; you are supplying two power plants for the price of one, and that is never going to work.  For the manufacturer to have a shot at selling at a price point that generates a net contribution margin, it has to be built with only one power plant.  If you want to peddle an electric car, then build an electric car.  Forget the second engine. 

What you could do is offer, as an extra-cost option, an add-on self-contained generator.  This would have a stub frame that slides into the rear of the auto, extending that frame by say two feet, onto which a small diesel generator is mounted transversely.  The stub frame would have its own dolly wheels for support, but no "hitch" type hinge; it would not swivel, and thus not be a conventional trailer.  When you want to go on some long trip and not expose yourself to the vagaries of recharge stations, you attach  the stub-frame extension, bolt it in, hook up that generator with an umbilical cord, and off you go.  When you are on short trips within battery range, you have the generator add-on sitting by the side of the house, ready to provide stand-by power in an outage. You can sell that extra engine on that basis.

What I find fascinating is that none of the builders like that approach.  All hybrids have that fuel engine permanently mounted into the auto frame, for extra weight to carry around, and not functional for anything else.  You already know that that is not going to work. 

Interestingly, Elon Musk understood this, and dumped the fuelled engine completely. But he designed and programmed his Tesla Model S  (I have to assume the others also) so that it cannot be driven with a power plug attached; you cannot charge and drive.  Just guessing, he wanted to avoid having owners pull away from the charging station with the external cord in place.  Yet, using a slightly modified trailer power cord that does not engage the wheels-off pin in the receptacle would likely work just fine.  The only conclusion I can come to is that I must be smarter than Elon.  But you already knew that!

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There is a massive amount of potential price drops in the future for EVs. New battery technologies and mass manufacturing should bump the price down to be equal or lower than gas cars soon. When you add in a low maintenance and the cost of electricity vs gas, you surely would get price going down. 

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(edited)

10 hours ago, Vlad Kovalenko said:


There is a massive amount of potential price drops in the future for EVs. New battery technologies and mass manufacturing should bump the price down to be equal or lower than gas cars soon. When you add in a low maintenance and the cost of electricity vs gas, you surely would get price going down. 

Unfortunately, the electric utilities, at least not in the USA, are not getting on board.  For example, my local utility charges 10 cents a KWHr for the first batch of power.  If you go over that consumption in a specific month, then they charge 23 cents a kwhr for the extra.  Pretty much everybody with an electric stove ends up going over.  (And this is an electric co-op, a non-profit!). 

Now, if you add auto charging into that pricing profile, then you are always past the low-price band, and always going to pay 23 cents/kwhr to re-charge those batteries.  That is going to be very expensive.  You might as well be buying gasoline. 

Part of the reasoning of this is that there is not enough transmission capacity out there to wheel the large amounts of power needed to do a lot of charging.  Unless the auto buyer is going to go invest in his own windmill or solar panel rack plus house storage, figure another $20,000 or $30,000 or more, he is not going to have the power available to re-charge his car.  How now? 

Edited by Jan van Eck
context error corrected
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8 hours ago, Jan van Eck said:

Unfortunately, the electric utilities, at least not in the USA, are not getting on board.  For example, my local utility charges 10 cents a KWHr for the first batch of power.  If you go over that consumption in a specific month, then they charge 23 cents a kwhr for the extra.  Pretty much everybody with an electric stove ends up going over.  (And this is an electric co-op, a non-profit!). 

Now, if you add auto charging into that pricing profile, then you are always past the low-price band, and always going to pay 23 cents/kwhr to re-charge those batteries.  That is going to be very expensive.  You might as well be buying gasoline. 

Part of the reasoning of this is that there is not enough transmission capacity out there to wheel the large amounts of power needed to do a lot of charging.  Unless the auto buyer is going to go invest in his own windmill or solar panel rack plus house storage, figure another $20,000 or $30,000 or more, he is not going to have the power available to re-charge his car.  How now? 

In your locality is there no competition? Are you stuck with one supplier? 

In the UK you have the choice of dozens of different suppliers which at least means you can shop around. 

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8 hours ago, Jan van Eck said:

Unfortunately, the electric utilities, at least not in the USA, are not getting on board.  For example, my local utility charges 10 cents a KWHr for the first batch of power.  If you go over that consumption in a specific month, then they charge 23 cents a kwhr for the extra.  Pretty much everybody with an electric stove ends up going over.  (And this is an electric co-op, a non-profit!). 

Now, if you add auto charging into that pricing profile, then you are always past the low-price band, and always going to pay 23 cents/kwhr to re-charge those batteries.  That is going to be very expensive.  You might as well be buying gasoline. 

Part of the reasoning of this is that there is not enough transmission capacity out there to wheel the large amounts of power needed to do a lot of charging.  Unless the auto buyer is going to go invest in his own windmill or solar panel rack plus house storage, figure another $20,000 or $30,000 or more, he is not going to have the power available to re-charge his car.  How now? 

In Europe most people trickle charge overnight every night on low rate electricity which resolves both of the problems you describe above. 

 

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20 hours ago, Jan van Eck said:

If you want to peddle an electric car,

HA!!

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1 hour ago, NickW said:

In Europe most people trickle charge overnight every night on low rate electricity which resolves both of the problems you describe above. 

 

And the folks that live in flats, or only have access to on-street parking?

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(edited)

19 hours ago, NickW said:

In your locality is there no competition? Are you stuck with one supplier? 

In the UK you have the choice of dozens of different suppliers which at least means you can shop around. 

Nope, rural area, stuck with one vendor.  But, on the bright side, I can go to the annual meeting of the co-operative and voice my opinions!

19 hours ago, NickW said:

In Europe most people trickle charge overnight every night on low rate electricity which resolves both of the problems you describe above. 

 

 Nope, no time-of-day cost variances, you pay for the kwh,  and that is the way it is.  The power comes from the New England Grid, which is 29% hydro, from Canada mostly, apparently.  Still quite a bit of nuclear and gas in the mix. 

Edited by Jan van Eck
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(edited)

On 10/2/2018 at 2:24 PM, JunoTen said:

Also concerning is the fact that EVs are forecasted to account for 7% of car sales in China in the month of December this year, which indicates that China will achieve its goal of 10% of cars sold in 2019 being EVs.

Add to that the impending launch of autonomous car services (Waymo later this year, GM in 2019) and you've got your peak oil demand for 2020 !

EV's were 45% of car sales in Norway last month, and over 50% if you include PHEVs, and they are contemplating banning ICEV sales by 2025. Today I read that Denmark also considering banning all new ICEV by 2030.

We live in interesting times.

Edited by Refman
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On 10/2/2018 at 11:24 AM, Brian W said:

Electric cars are poised to arrive en masse in European showrooms after years of hyped concept-car launches and billions in investment by automakers and suppliers. The hard part is selling them at a profit as consumers resist paying more for electrified vehicles - forcing carmakers to sell them at a bigger loss to meet emissions goals. 
 

Yes very small countries, with narrow roads, small cars are feasible ..........and smaller distances to travel, yet still after so many years ..... success? why didnt TESLA go after the EURO market? would have been a lot more successful..........

and before anyone attacks me for  being a Euro-Phobe or whatever, I spend a lot of time in Euro-Land----- if you want to know ask me the details--- but I love to come back home to the Land and Home of the????? song and dance please!!!!!!

Wide open spaces, that I can drive my high performance vehicles on the road and off the road!!!!

 

 

7 hours ago, Refman said:

EV's were 45% of car sales in Norway last month, and over 50% if you include PHEVs, and they are contemplating banning ICEV sales by 2025. Today I read that Denmark also considering banning all new ICEV by 2030.

We live in interesting times.

 

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Your point regarding those countries being a small market is well taken, but to me it is a sign of things to come, and they were probably amplified by Diesel-Gate.

It is my understanding that Tesla is very popular in Norway, however, that being said Tesla does not have the manufacturing capacity to go after every market. They are working on a factory in China, and I'm sure the next one will be in Europe somewhere.

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16 hours ago, Jan van Eck said:

Nope, rural area, stuck with one vendor.  But, on the bright side, I can go to the annual meeting of the co-operative and voice my opinions!

 Nope, no time-of-day cost variances, you pay for the kwh,  and that is the way it is.  The power comes from the New England Grid, which is 29% hydro, for Canada mostly, apparently.  Still quite a bit of nuclear and gas in the mix. 

Surprising if there is a lot of Nuclear because normally they want to offload the power over night. Lower price overnight electricity is one way of doing that. Even without Nuclear it also allows you to get a higher capacity factor out of thermal plant.

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8 hours ago, ceo_energemsier said:

Yes very small countries, with narrow roads, small cars are feasible ..........and smaller distances to travel, yet still after so many years ..... success? why didnt TESLA go after the EURO market? would have been a lot more successful..........

and before anyone attacks me for  being a Euro-Phobe or whatever, I spend a lot of time in Euro-Land----- if you want to know ask me the details--- but I love to come back home to the Land and Home of the????? song and dance please!!!!!!

Wide open spaces, that I can drive my high performance vehicles on the road and off the road!!!!

 

 

 

I live just East of London in an area with a fair amount of money sloshing about and I regularly see Tesla's on the road now.

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35 minutes ago, NickW said:

I live just East of London in an area with a fair amount of money sloshing about and I regularly see Tesla's on the road now.

I've seen two in my life.

Not recognizing the logo, my kids were like, "What kind of car is THAT?"

I say, "Hmmm... I don't know." I squint to better discern the logo. My brain cycles through all the major car manufacturers. "Oh, I think it's a Tesla," was my delayed reply. 

"A Tesla? What's that?"

"It's an electric car."

"A what?" 

"It doesn't take gas. You plug it in, like your phone."

Glancing back down to their cell phones, I hear a lackluster, "Oh, cool."

Yup. Cool.

 

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54 minutes ago, Rodent said:

I've seen two in my life.

Not recognizing the logo, my kids were like, "What kind of car is THAT?"

I say, "Hmmm... I don't know." I squint to better discern the logo. My brain cycles through all the major car manufacturers. "Oh, I think it's a Tesla," was my delayed reply. 

"A Tesla? What's that?"

"It's an electric car."

"A what?" 

"It doesn't take gas. You plug it in, like your phone."

Glancing back down to their cell phones, I hear a lackluster, "Oh, cool."

Yup. Cool.

 

Teslas are a wealthy man (or womans) car so are not necessarily a good universal indicator.

There are loads more Nissan Leafs on the road and Prius / Auris Hybrids are getting pretty ubiquitous. I was in Westminster this morning and almost ever other car going past was an Auris / Prius Hybrid. I know Hybrids use petrol but they have been a test bed for development of EV cars.

Outlander PHEV's are a pretty common sight

Hyundai Ioniq Hybrid / PHEV's are much more common too.

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1 hour ago, Rodent said:

I've seen two in my life.

In San Francisco - I swear it's every other car nowadays. And it's not uncommon to see a 25-30 year-olds driving the Model S P100D
Then again San Francisco is it's own bubble that doesn't exist anywhere else. 

I've only seen a couple moms here in Mexico city driving around Model X's and maybe 1 Model S.

You'd be surprised - I've seen Tesla charging stations in the most RANDOM cities around Mexico city. 

 

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he wanted to avoid having owners pull away from the charging station with the external cord in place....lmao

But the car will drive itself into a stationary object on auto pilot without  missing a beat....lmoa. Somewhere there has to be an engineer that could have said something like this during testing "The car should stop automatically if it senses an object in front of it that is not moving out of the way and the driver doesn't take control at the warning signal" NOT....A new tractor trailer is by no means a feat of genius, but they are mostly equipped with a system that will at least do that if the driver isn't paying attention. Maybe he isn't the genius that folks want to portray him as. And I am interested in how his leaving could influence the price of the stock, the stock has value because of the companies assets right? Physical assets that can be seen and touched....and sold. That says to me that the stock is artificially inflated, and the company can't cover its stocks with tangible assets like cash or property. Why does that seem wrong? I have been watching this play out for a long time and I just wondered how a company that is losing so much money can have stocks that do anything but fall. 

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A lady drove around Australia in a Musk EV, that would be 20,000 plus Kms total cost of $90.   She planed her trip and charged overnight at the Motel.   We have huge distances here, I myself regularly do 17,00 km for a winter trip, Travel 400 km spend a night in a motel, it is little more than the fuel cost in Outback Australia.   Makes you think. 

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