EV Follies

Legacy automakers made a catastrophically bad bet on EVs. They are now suspending some new product launches, slashing production on existing EV products, canceling multi-billion dollar battery projects, pivoting to hybrids, and redeploying employees from underutilized EV factories to plants that produce the vehicles that consumers actually desire, e.g. those with gasoline engines.
WSJ - Some auto executives acknowledge they got ahead of the market with overzealous demand projections.
“Some auto executives” could have avoided billions of dollars in unnecessary losses if they had talked to me before committing so heavily to the EV fantasy.
[Ford CEO Jim] Farley and other industry CEOs are still confident that EVs will eventually take off, albeit at a slower pace than initially envisioned. But for now, the massive miscalculation has left the industry in a bind, facing a potential glut of EVs and half-empty factories while still having to meet stricter environmental regulations globally. “Ultimately, we will follow the customer,” GM Chief Executive Mary Barra told analysts this month.
It’s good that Mary Barra is now acknowledging that General Motors has no choice but to “follow the customer.” Unfortunately, she had previously promised to take GM all-electric in barely a decade, mistakenly believing that GM has the capability of leading the customer down that path, rather than following the customer. GM does not have that capability.
Ford is now having to retrench from its failing EV programs. But as noted in the quote up above from the Wall Street Journal, Ford’s destructively inept CEO, Jim Farley, is still a believer in the EV transition. He is clearly willing to destroy Ford Motor Company in pursuit of the globalist anti-carbon agenda.
So how did Ford’s EV division fare in 2023? “Ford’s electric-vehicle business lost nearly $4.7 billion in 2023 and could lose another $5 billion this year, but CEO Jim Farley argues the automaker is undervalued…”
A ship that is taking on water is rarely “undervalued.” How do you “undervalue” a business that is willing to lose $10 billion in just two years on a product that customers don’t want?
Ford sold 72,608 electric vehicles in the US in 2023. Its $4.7 billion loss on EVs averages out to over $64,000 for every electric Ford sold in the US in 2023. Ford’s Board of Directors will have to address the crisis in their CEO office sooner rather than later.
Even Californians Are Giving up on EVs.
In “EV friendly” California, total electric vehicle sales declined in the third quarter (Q3) of 2023 from the number sold in Q2, and then the bottom fell out in Q4, with EV sales declining another 10%, or about 11,000 cars.
“EV sales start to fall in California; Consecutive quarters of falling EV sales could derail state's zero-emission vehicle transition target” [Automotive News – 01/31/2024]
The pain was spread among all EV manufacturers, with Tesla’s sales decreasing by about 5,000 units, and the other manufacturers combining for a decline of about 6,000 units.
“Tesla California registrations fall for the first time since the pandemic” [Reuters – 01/31/2024]
Registrations of Tesla dropped 10% in the last quarter of 2023, the first fall in more than three years in the state, which is one of the most important markets for the electric carmaker and considered a national trend setter.
Is it possible that Q4 EV sales plummeted in California because total vehicle sales also fell? Nope. Not the case.
This was the fifth consecutive quarterly increase in new car sales in the state. The Q4 2023 pace of new car sales showed a slight acceleration compared with Q3, posting a 6% increase.
Sales of the various forms of hybrid are rising rapidly as even California car buyers are starting to reject EVs.

 

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THE MORNING RANT: Roundup of the Latest EV Follies (02/16/2024)
—Buck Throckmorton - https://ace.mu.nu/#408387