Intel Report | Oct 21 | The Weekly Automotive & Mobility News That Matters

BY AUTOMOTIVE VENTURES | OCT 21?2024?| VIEW ONLINE ??

Automotive Ventures portfolio company?Treehouse ?has raised a $16.6M?Series A funding. Treehouse is?on a mission to simplify electrification projects of all types and to do it, they're building a software-enabled installation platform that is creating value for all critical stakeholders - electrified product manufacturers, homeowners, and electrical contractors. | LINK

What We're Reading:

??? Mobility

The Oliver Wyman Forum projects that the global mobility industry will grow to $1.1 trillion through 2035 (up from $389 billion in 2023). It's amazing to see how their forecasts across 14 categories of "Mobility Services" have changed (in many cases very dramatically). | OliverWyman Forum ?

??? Automotive

Just in time for Halloween, Rivian brings back David Hasselhoff (as Michael Knight) to channel their best K.I.T.T. impression.?| Car and Driver

An increasing number of consumers with auto loans have negative equity, meaning they owe more on their vehicle than it’s worth. As of the third quarter that ended Sept. 30, Edmunds said 24.2% of trade-ins applied toward a new vehicle purchase had negative equity. The average upside-down loan spiked to an all-time high of more than $6,400. Of those with negative equity, 22% owed $10,000 or more, and 7.5% owed $15,000-plus. | The Washington Post ($)

Car prices have been taking a toll on inflation, with the cost of owning a new car at about $1,000 a month compared with $774 before the pandemic.?One consequence of higher costs is that people are hanging on to their cars for longer. According to one industry estimate, the average age of passenger cars now on the road has risen to 14 years.?| Bloomberg ($)

Stellantis NV CEO Carlos Tavares' message to dealers and suppliers struggling for profitability on the bumpy road to increasing adoption of electric vehicles is: "Deal with it."?| The Detroit News

Tim Jackson argues why bringing back dealer-facing, volume-based "stair step" new vehicle incentives is a bad thing for all parties: automakers, dealers and consumers. | Automotive News ($)

Ferrari has revealed its F80 supercar, priced at €3.6 million and powered by a 1200-horsepower V6 hybrid engine. Inspired by the aerospace industry, the F80 reaches a top speed of 217 mph. Only 799 units will be produced, with all already reserved by potential buyers. This marks Ferrari's first supercar launch since the 2013 LaFerrari, reflecting the company's strategy to maintain exclusivity and boost profits. Deliveries start next year.?| Road & Track

Ferrari became Europe’s most valuable automaker by increasing sales volumes and prices while persuading customers to purchase lots of expensive options. But now its finely tuned business model is showing signs of wear. While new vehicle orders extend well into 2026, nearly new sports cars are piling up in the used market. The Italian manufacturer has put part of the blame for weaker resale values on the esoteric choices of its wealthy clients. Some options, such as special paintwork, are “maybe not so appreciated by the second client,” Chief Executive Officer Benedetto Vigna told investors in August, citing an analysis of 20,000 used transactions. In contrast, “functional” personalization choices maintain their value, he added, insisting overall residual values remain “strong.” | Bloomberg ($)

In 2013, McLaren, Ferrari, and Porsche all had the same idea, to build the world’s highest-performing supercar with the latest hybrid technology. Now, 11 years later, we get to see round two (though Porsche seems to be sitting this one out). Succeeding both the McLaren P1 and Ferrari LaFerrari are now the McLaren W1 and Ferrari F80, released within just two weeks of each other.?| The Drive

How might Porsche respond to the new hypercar wars? | The Drive

Last year, the small South Caucasus nation of Georgia imported $3.1bn (￡2.4bn) worth of cars, according to official figures. It then exported vehicles to a value of $2.1B, mainly to former Soviet republics in the Caucasus and Central Asia. Cars are in fact Georgia’s second-largest export by value, after copper ore.?| BBC

An attempt to stage an auto accident in Queens, New York, was thwarted all thanks to a simple dash cam.?| Jalopnik ?

???Electric Vehicles (EVs)

BloombergNEF estimates that sales of EVs — including both battery-electric and plug-in hybrid vehicles — are headed to 16.7 million units this year, up from 13.9 million in 2023. | Bloomberg ($)

Elon Musk set out to make Tesla “a guiding light” that would lead other automakers to electrify their cars years before they might have otherwise. Among the puzzling aspects of Mr Musk’s devotion to electing Donald Trump is that the former president considers this achievement a historic mistake. “The electrics are just not going to work,” Mr Trump told the Detroit Economic Club on October 10th. “The entire industry will go to China for the making of these all-electric cars and trucks. The auto industry would be non-existent.” | The Economist ($)

Electric vehicles have had a hard year. Sales have been disappointing. Former President Donald Trump has regularly disparaged them. And even many environmentally conscious car buyers have been choosing hybrids instead. Yet the chief executive of 通用汽车 , Mary Barra, says the company is still committed to doing away with combustion engine cars in the United States by 2035 — and she may have good reason for her optimism. GM says it will start making money on battery-powered models by the end of the year — becoming the only U.S. automaker aside from Tesla to achieve that feat. | The New York Times ($)

Around this time a year ago, the first headlines started to emerge about a drop-off in demand for electric vehicles. Automakers including GM and 福特 began to scale back production plans and delay model launches, and others followed suit. In the first half of this year, global EV sales rose 26%, and preliminary data suggests sales increased around 30% in September. That’s very solid growth, though it is down from an increase of 33% last year and 60% the year before. | Bloomberg ($)

Plug-in hybrids are not the electric vehicle compromise that consumers have been clamoring for, according to a new study from J.D. Power . Overall satisfaction on a 1,000-point scale with PHEVs is 669 while mass-market satisfaction with BEVs is 716, according to J.D. Power consumer satisfaction data. Satisfaction with premium EVs is 738 on a 1,000-point scale. | Automotive News ($)

Global sales of fully electric and plug-in hybrid vehicles rose by an annual 30.5% in September, as China surpassed its record numbers recorded in August and Europe resumed growth. Gains in the U.S. market have been slow and steady in anticipation of the Nov. 5 election, which makes it difficult to predict future trends in the country.?| Reuters ($)

Electric cars have gone from pricey purchases to some of the biggest bargains on the used-car lot, as resale values for the vehicles have tumbled. Two years ago, some used electric car models were selling for as much or more than new ones, because of a supply-chain crisis that resulted in a broader car shortage. Now, the dynamic has flipped. Dealer lots are full of unsold EVs, and car companies—largely led by Tesla —have slashed prices on new models in an effort to sell them. | The Wall Street Journal ?($)

A study published last month in the journal Nature found that EV charging stations boost sales at nearby businesses. Shops, restaurants and hotels within about 300 feet of an EV charging port see sales increase roughly 3% compared to similar businesses that don’t have a charger nearby, according to the MIT-led research team. That adds up to several hundred dollars of extra revenue at each store every year.?| The Washington Post ($)

Democratic strongholds of California, Colorado and Washington continue to make up the largest share of new EV purchases, with Republican bastions including Mississippi, Arkansas and West Virginia making up the smallest percentage of sales. In each of those southern states, electric cars accounted for less than 3% of new-vehicle sales in the second quarter compared with 27% in California and 18% in Washington state, according to the Alliance for Automotive Innovation. There are clear geographical and economic elements that influence EV buyers in these areas, but it’s hard to ignore the political divide: data shows that Republicans make up the largest group of new car buyers in the US, but Democrats are 4.5 times more likely to buy an EV.?| Bloomberg ($)

Toyota Motor Corporation is exhibiting portable hydrogen cartridges. Hydrogen is the ultimate clean energy that emits no CO2 during use, and CO2 emissions can also be minimized during the production process when renewable energy sources such as wind and solar are used. Hydrogen can be used to generate electricity in fuel cell systems and can also be used as a combustion fuel. Toyota has reduced the size and weight of hydrogen tanks, which were previously large and difficult to carry, to a size that can be carried by hand.?| Toyota

Tesla’s Cybertruck is facing blowback in Europe, particularly over pedestrian safety concerns. Euro NCAP, a voluntary but influential car safety assessment program in Europe, has not in any way tested the Cybertruck, but based on a visual assessment alone, raised alarms over its sharp, angular design, saying it could pose a serious threat to pedestrians.?| TechCrunch

Three police chiefs from Northern California cities who have independently come to the same conclusion: Teslas are not equipped to handle the demands of modern policing.?Once modified, for example, the car’s back seat is too small for more than one passenger, with the front too cramped for the officers. The chiefs further cite “autopilot interference” when trying to pull off the road; they also say a reliance on unsecured charging stations makes officers vulnerable when it comes to transporting suspects long distances and note that in a firefight, police are taught to hide behind a car’s engine block. With EVs, that’s not an option. | SFGATE

At Tesla’s ‘We, Robot’ event where they unveiled their new Robotaxi, the automaker confirmed that wireless charging is going to be the company’s solution to charge its autonomous vehicles in the future.?| Electrek

????? China

GM CEO Mary Barra says China’s hypercompetitive, cheap EV market is a ‘race to the bottom’.?| Fortune ?($)

"New energy" vehicle sales in China, which include battery electric and plug-in hybrid, are expected to hit 11.5 million units this year, well over a third of total light vehicle sales in the country, according to the China Association of Automobile Manufacturers. New energy vehicles are expected to account for more than 75% of new vehicle sales in China by 2030. Chinese brands make up 65% of all new vehicle sales in the country now and are on pace for 90% market share by 2030, according to an analysis by consulting firm AlixPartners . That is a staggering shift — just four years ago, more than 60% of vehicle sales in China were gas-powered brands from makers based outside of China. | Automotive News ($)

比亚迪 aims to woo European buyers, but not with low-cost cars. BYD Executive Vice President Stella Li criticized EU tariffs on China-made EVs as a loss for the consumer. BYD, China's best-selling car brand, may initially offer electric vehicles in Germany for between €25,000 ($27,340) and €30,000. | Automotive News ?($)

BYD plans to “double to triple” its dealer network in Europe by the end of next year. In Germany, BYD will expand its retail network faster and aims to increase the number of dealers in the market to 120 by the end of 2025 from 26 now. Success in Germany is crucial to BYD, which wants to achieve a 5% share of Europe's EV market in the midterm. BYD's German sales have remained low even after the automaker invested heavily to be the automotive sponsor for the European soccer championship held in Germany.?| Automotive News ?($)

After increasing its annual sales in China 15 times over, to 3 million cars in only three years, BYD is now exporting to roughly 95 markets, including 20 new ones this year. The company is building, has recently opened or has announced plans for assembly plants outside China in 10 countries on three continents. The speed and scope of this expansion have caught the global auto industry off guard and triggered protectionist tariffs in the US and EU, where policymakers fear Chinese players such as BYD will, in the words of Elon Musk, “demolish” their domestic automakers.?| Bloomberg ($)

As China moves away from combustion-engine cars, 大众 , Mercedes-Benz, and 宝马 ? are struggling to offer electric vehicles that appeal to customers in their largest and most lucrative market, putting €35 billion ($38 billion) of investment on the line. After dominating the combustion-engine era, German automakers became complacent, underestimating the threats posed by new rivals and reluctant to abandon the profits generated by big-engine cars. That allowed Tesla and local companies led by BYD to speed by with tech-savvy and affordable plug-in hybrids, and now China no longer needs or wants them there. | Automotive News ?($) ?

???Robotics & Autonomy

Elon Musk's choice of Warner Bros Studios for the long-anticipated launch of his robotaxi on October 10th is entirely appropriate. Hollywood's film studios are as much a dream factory as Tesla, his electric car company. The vision he served up, accompanied by whoops of delight from the superfans in the audience, is an autonomous Cybercab so cheap that it will serve as "individualized mass transit". But Mr Musk's promises were, like many Hollywood movies, long on bombast and short on reality. The road to self-driving taxis will be long, and Tesla will have tough competition along the way.?| The Economist ($) ?

????Connectivity

More than half of vehicles sold globally are connected, according to 麦肯锡 . The consulting firm forecasts that figure will rise to 95% by the end of the decade. That connectivity gives hackers more targets. Last year, 95% of automotive cyberattacks did not require physical access to vehicles, according to a global automotive cybersecurity report by Upstream, which monitors 25 million connected vehicles worldwide.?| Automotive News ($) ?

??? Aviation & Space

The rockets are nifty, but it's the satellites that make SpaceX valuable. Elon Musk’s space venture may soon be more valuable than Tesla.?| The Economist ($)

Space is highly geopolitical, as Americans will recall from the Cold War. Starlink terminals have proven critical on the battlefield in Ukraine but also stoked doubts over whether Elon Musk is doing enough to crack down on their illicit use by Russian forces. Musk has also appeared to use Starlink as leverage, such as when the service told Brazil it wouldn’t comply with a requirement to block access to Musk’s social media platform X. (It later complied.) For the European Union to accept dependence on SpaceX in a $630 billion global space economy, where China is also resurgent, is a risk: It assumes Musk will always “come in peace” despite his four-letter invectives against EU regulators and his pal Donald Trump’s trade barbs.?| Bloomberg ($) ?

????Climate

The world is on the brink of a new age of electricity with fossil fuel demand set to peak by the end of the decade, meaning surplus oil and gas supplies could drive investment into green energy, the International Energy Agency (IEA) said on Wednesday. But in a release accompanying its annual World Energy Outlook report, the agency also flagged a high level of uncertainty as conflicts embroil the oil and gas-producing Middle East and Russia and as countries representing half of global energy demand have elections in 2024. | Reuters ($)

Demand for electricity around the world is rising faster than expected, making it harder for countries to slash their emissions and keep global warming in check, according to the International Energy Agency (IEA). Over the next decade, the world is poised to add the equivalent of Japan’s annual electricity demand to grids each year, driven by surging power needs for new factories, electric vehicles, air-conditioners and data centers, according to the agency’s annual World Energy Outlook, a comprehensive report on global energy trends. | The New York Times ($) ?

?????Car of the Week

Our Automotive Ventures "Cars of the Week":?a 1965 Ferrari 275 GTB by Scaglietti. | RM Sotheby's

Have a great week,

Steve Greenfield