Like many things, the electric vehicle world has been in limbo for the last few months. Many OEMs are still currently on track for new model releases but, as expected, many are also delayed. With canceled auto shows, cash flow issues, closed proving grounds, and shuttered production facilities, we’ve seen announcements, R&D, and plant construction come to a virtual standstill. These unexpected *speed bumps* are detrimental to schedules that are meticulously put in place well before a vehicle is scheduled to be in a customers’ hands.
Of the EVs slated to be released in the next year or so, these are some of the more interesting ones that have provided further details about their current state of affairs.
Markus Baumann, Head of Test and Digital Commissioning at BMW, recently told Austrian Industry Magazine that the i4 “is at the moment completely in the green area.” Meaning the vehicle is still on its original testing, validation, and production schedule, and that the vehicle should be released as promised in 2021.
Back in January, Byton announced that the U.S. launch for the M-Byte would be pushed from 2020 to sometime in 2021. Now the company has put “about half” of its 450 staff members in Santa Clara on furlough. The end of May was the target timeline for people to return to work but there have been no reports of this going into effect. A spokesperson told Electrek that the “production timeline will no doubt be impacted.” While all product testing is currently done in China where no workers have been furloughed, it’s possible that the timeline for the M-Byte to be delivered in the U.S. will be pushed back again.
One of the bigger EV debuts of the year is Ford’s Mach-E which is still on track to arrive in late 2020 for the US (Europe is delayed). As reported by CNN back in April, Ford engineers took home more than a dozen pre-production vehicles to continue making improvements in order to keep the original delivery dates on track.
General Motors has confirmed for now that it’s electric vehicle program is still on schedule with the Hummer, Lyriq, and GM’s Cruise Launches Origin, A Fully Autonomous Vehicle, expected to be released next year. The unveiling of these vehicles has been postponed for now but the work on these vehicles is said to still be pushing ahead. Details have not been given on how the development is pushing forward with a remote workforce, but one program is said to even be ahead of schedule at this point.
Karma announced that its all-electric vehicle the Revero GTE will be released in the Spring of 2021. A few weeks ago, Karma said that it had started prototype testing of the new model. Stating that “Karma engineers recently conducted dynamic testing at California’s exclusive Thermal Club race track, among other performance circuits and conditions.”
Lordstown Motors, a maker of light-duty work trucks, said that it has moved plans back to deliver the first vehicles to customers to January 2021, one month later than the original delivery date. The automaker recently announced that due to the canceled North American International Auto Show, the unveiling of the Endurance will now take place virtually on June 22nd. Included in that announcement was an update on the progress of the conversion of GM’s former plant into an EV production facility, which appears to be on schedule.
Lucid has trudged ahead with the construction of its production facility in Arizona and is actively hiring for all types of positions. It has also been giving a behind the scenes look at its beta prototypes that have been immobile for the last few months. Normally “these vehicles would be racking up long-distance miles on the highway or circling a test track as [Lucid] refine and validate the Lucid Air’s advanced engineering and game-changing performance.” For now, they are awaiting the opportunity to get back out on the road for testing and validation. The production unveiling that was originally scheduled for the New York Auto Show, has not been rescheduled, and production dates of late 2020 are still on track, according to CEO Peter Rawlinson.
The highly anticipated release of the R1T by Rivian has been pushed back to 2021 from late 2020. While a few workers have been on-site the last few months prepping the plant in Normal, Illinois for production, testing has effectively come to a halt. However, the plant has recently started reopening on a larger scale using a phased approach. Rivian’s Amazon delivery truck is still on track for its first deliveries next year.
In other Rivian news, Lincoln canceled its all-electric partnership with Rivian citing “[g]iven the current environment, Lincoln and Rivian have decided not to pursue the development of a fully electric vehicle based on Rivian’s skateboard platform.”
Volkswagen has been running into software issues with the ID3 causing delays of deliveries until September of this year, a delay of a few months. These delays date back to December of last year. The ID3 is viewed as a vehicle that will be around for the long term for VW so a few delays should not impact their larger electrification plans for the future.
BloombergNEF recently published its yearly outlook for the electric vehicle (EV) market with some intriguing findings. We’ve highlighted the facts and predictions that stood out to us most but you can see the full report here:
As some states slowly look to lift restrictions related to COVID-19, we still look to other countries that are ahead of the US in terms of lifting restrictions such as China to see what the future may hold. In a time when social distancing may become a new norm, what does this do to mass transportation and the future of private car sales?
In a recent study completed by Ipsos, before COVID-19 hit China, 34% of respondents used their own private car and 56% used the bus or metro. After the COVID outbreak, 66% planned on using their own private car vs. 24% now planned on using the bus or metro. While there was a slump in sales while the outbreak was occurring, there may be a larger demand for private cars after restrictions are lifted. In the survey by Ipsos, 66% of the people that responded planned on purchasing a car within the next 6 months due to the fear of infection from mass transportation.
In the US, we’re still in the midst of the COVID outbreak but we are starting to see some states lift restrictions. We would expect that there may be a shared view of mass transportation and a major sentiment to drive a personal car. While ICE and EV sales are expected to be 50% of what they were in April 2020 vs. April 2019, according to CNBC, a bounce-back in the near future looks likely.
For EVs specifically, sales were strong prior to COVID. According to InsideEV, they were up 16% compared to the previous year. COVID has thrown a wrench into the car sales industry and it’s yet to be seen how sales will be affected post-COVID. People are enjoying cleaner air and quieter roads, which can be partially attributed to fewer cars on the road. Both of these benefits could be enjoyed more with an increase in EV market share, as noted in our previous article. We see this as a speed bump to the EV industry, but we believe that sales will bounce back as people experience the benefits of EVs.
Car manufacturers have also dedicated billions of dollars to R&D for new EV models and we expect this trend to continue. For example, Volvo recently told Automotive News that they will cut some R&D and design budgets but will keep their EV budget intact. CEO Hakan Samuelsson remarked, “electrification, autonomous driving, and our future technology development are an absolute priority.”
How sales occur may change as well. Right now, car dealerships are offering to deliver cars to your house, or you can make an appointment at a dealership to test drive a car with minimal human interaction. Of the responses in the previous survey, 79% preferred this method after the outbreak. We expect dealerships to continue with this approach in order to ensure the safety and health of customers, but also their employees. Closing the transaction may be a new experience as well. Instead of signing the mounds of paperwork that you typically would at a dealership, you may just sign electronically. The future may be researching online, having a vehicle dropped off at your house, negotiating the price over the phone, and then finalizing the paperwork digitally. Time will tell if this will be the new norm. For now, we will enjoy test driving an EV next weekend with minimal interaction with a salesperson. Stay tuned for more about this adventure next week.
COVID-19 has affected us all to some degree, from orders to shelter in place to maintaining social distance. For the electric vehicle (EV) industry, it has had various impacts including affecting research and development, the supply chain and specifically, the production of its batteries. For years, the United States has fallen behind its competitors in EV battery production, but will COVID-19 act as a catalyst in the move of battery manufacturing from China to the US?
In recent years, moving manufacturing out of China has been on the docket for many companies. A Bank of America survey revealed that “two-thirds of global sectors in North America have either implemented or announced plans to pull at least a portion of their supply chains out of China”, including the automotive industry. For most industries, including the EV battery industry, the factory shutdowns as a result of COVID-19 could serve as an eye-opener to the United States’ reliance on China. A move to the US for EV battery manufacturing would provide more eco-friendly jobs, increase national energy security, reduce foreign dependence, and help the US firmly establish itself as the world leader in the transition to EVs.
Bringing EV battery manufacturing to the US is easier said than done. Most EV batteries are lithium-ion. The majority of this battery production currently takes place in China. Yayoi Sekine of BloombergNEF reported that in 2019, of the 316 gigawatt-hours of lithium cell manufacturing capacity worldwide, China led the way globally with 73% compared to only 12% to the next largest producer, the United States. With this large of a gap, it would take a concerted effort over the coming years to move production primarily to the US, but it can be achieved.
To better understand how a change like this could happen, it’s important to look at where the main elements of lithium-ion batteries come from. You guessed it, lithium is a large component of EV batteries. For years dating back to the early 1990s, the US led the entire world in lithium production, but for the last 25+ years, that hasn’t been the case. With the advent of EVs, mining companies across the US have worked to improve their positions as top producers but have fallen short. There are currently four countries that dominate in lithium production: Australia (51,000 tons), Chile (16,000 tons), China (8,000 tons), and Argentina (6,200). Because of privatization and secrecy, lithium production numbers aren’t public and are just an estimate in the US, but we do know that the US is far behind. It’s not that the US can’t become a leader in lithium production, it just hasn’t done so in recent years.
China also dominates the US when it comes to the other elements within lithium-ion batteries: cobalt, nickel, manganese, and graphite to name a few. For example, China is the only commercial-scale producer of spherical graphite. In order to improve the US’s place in the EV battery manufacturing world, it needs to improve in all facets of element production for batteries.
James Breyer, CEO of startup Hercules EV, commented when asked about the current state of EV battery manufacturing in the US: “US domestic production of batteries and other energy technologies is paramount to the security and sustainability of the electric transportation industry moving forward. While supply chain disruptions of the magnitude seen with COVID-19 are hopefully fewer than once per millennium, it showcases the need for distributed supply chain networks.” To overcome this, he has promised that his company will make a strong effort to partner with manufacturers that have regional supply chain capabilities.
According to research, the global EV battery market is expected to grow by $15.7 billion between 2019 and 2023, providing an opportunity for the US to close the gap with China. COVID-19 has opened the world’s eyes to many ways that we can change and improve. Will the location of EV battery manufacturing be one of them? We won’t know the true impact for a while, but this could be the start of big change for the EV industry.
In these unprecedented times, we find ourselves inundated with a significant amount of negative news. At the time of writing this, according to the CDC, there are over 160,000 confirmed cases of COVID-19 and 2,800 deaths in the US, and this amount is only rising. It’s hard to see through the negativity to get through to the positive stories, but there are some bright spots such as businesses and communities prioritizing health and safety, neighbors helping each other out, and some municipalities implementing virtual inspections to make sure that vital construction can continue. Another big positive that we noticed is how new technology like electric and autonomous vehicles (EV and AV respectively) can have a positive impact on the future
In the past, we’ve written about the benefits of EVs and in an odd way, today’s circumstances provide a look into what a future with ubiquitous EVs could hold. For one, we are starting to hear about how pollution levels are down in cities as more people are working from home and factories close down. As we wrote about, pure EVs emit no harmful gases and pollutants and would help to reduce pollution levels when the world returns to normal work life. We have also noticed how much quieter cities have become with fewer vehicles on the road which would be similar to a world with more EVs because of much less noise pollution compared to ICE vehicles.
Autonomous Delivery Vehicle
In times of crisis, we may see our government be more flexible and this may allow the acceleration of innovation. For example, this could be an opportunity for grocers to push further for the development of AV assisted deliveries. A company out of Bejing called Neolix has claimed that the pandemic has caused a boost in sales of its delivery bots. This autonomous grocery delivery could cut down on crowded grocery stores and may prevent the hoarding of necessities like water and toilet paper. Some people would argue that toilet paper isn’t necessary to hoard, but the grocery store shelves around the US might tell you otherwise.
AVs would also help overcome the driver shortage and logistical nightmare we are seeing with freight transportation. AVs transporting medical supplies to hospitals would allow oversight to be remote and would reduce human interaction. At EPG, we’ve even seen how self-driving technology controlling the movement of containers in shipping yards are doing their own part in getting critical supplies delivered faster. We believe AVs can play a vital role in improving people’s lives if implemented in a safe and correct manner.
In the days of 24/7 news, we often need a little dose of positivity. The world will get through this pandemic and although it may be hard to believe, some good things will come from it. We hope that everyone is staying safe and healthy around the world!
As EV popularity grows and revolutionizes the auto industry, we have seen the introduction of new companies that are focused on just EVs and existing manufacturers introducing more EVs to their existing lineup. One practice that seems to be in question is how these EVs are sold to the consumer. Many states have current franchise laws that require vehicles to be sold by an independent dealership or limit the number of non-franchised dealerships that a manufacturer can have in the state.
For example, Georgia limits non-franchised dealerships to five in the state. Some EV manufacturers are starting to challenge these laws and challenge how vehicles are being sold to consumers. In Colorado, legislation is making its way through the House to allow automakers with no existing dealer franchise network to sell EV’s direct to consumers. If the bill makes its way through the house, it will head to the governor’s desk for signature.
EV’s are changing the landscape of the vehicle industry in more ways than one. Could we start to see more and more states change how vehicles reach the consumer?
Where Can You Buy a Tesla Directly?
States With Total Direct Sales Bans
Alabama (also bans service centers)
New Mexico (also bans service centers)
South Carolina (also bans service centers)
States With Limited Sales
Colorado (1 store limit)
Georgia (5 store limit)
Maryland (4 store limit)
Michigan (Lawsuit Settlement)
New Jersey (4 store limit)
New York (5 store limit)
North Carolina (6 store limit)
Ohio (3 store limit)
Pennsylvania (5 store limit)
Virginia (2 store limit)
States for Which Tesla Gained the Right to Mostly Unrestricted Direct Sales
Arizona (2017 court ruling)
Indiana (2017 law change)
Massachusetts (2014 court ruling)
Michigan (2020 legal settlement)
Minnesota (2013 law interpretation)
Missouri (2017 court ruling)
New Hampshire (2013 law change)
Rhode Island (2017)
Utah (2018 law change)
Washington (2014 law)
Wyoming (2017 law change)