US Auto Makers Falling Off the EV Train

GM’s Mary Barra just explained that GM is bailing from its 400,000 EV goal. There are lots more buzzwords like “in order to make more cost-effective vehicles”. Ford’s Jim Farley has made similar statements. Does this mean there is no longer demand for EVs?

The answer is no, that isn’t what it means. Mostly what it means is that the Detroit big three are just way behind in the EV game. That is, they don’t know how to make compelling EVs at an affordable price. Clearly the UAW strike has made things worse for them as they were already losing money on every EV they produced. The strike is costing a lot in lost productivity and when it ends the result will be higher car manufacturing costs. (The Electric Viking talks more about the GM part of the story.)

While the big three are delaying everything, other players are jumping ahead. Tesla, of course, is doing very well. While Musk’s Q3 statements seems pretty “low key”, they really just translated to not wanting to jump into more expenses when the future is not secure. Realistic but Tesla sales are fine, the Cybertruck is just hitting the market and Tesla’s income from other products such as the Powerwall and MegaPacks continue to grow. By the time the big three wake UP, the $25,000 Tesla will probably be in production.

What about other vendors? VW and Mercedes are making EVs in the US. Hyundai and Kia are working toward that. While BYD has said they don’t currently plan to enter the US market it seems like they could before the big three get back on track. They are growing quickly worldwide and already produce lots of electric buses in California.

No, moving to EVs is still happening — it just is happening faster outside the US and by non-US manufacturers. While the IRA was supposed to help the big three it seems like it is mostly helping foreign manufacturers to start producing their vehicles in the US.

Leave a Reply

Your email address will not be published. Required fields are marked *