This past week, the national conversation on electric vehicles concentrated on improving charging infrastructure and its challenges. We are continuing to track microchip shortage updates, including how they may or may not have impacted Q1 sales for OEMs and suppliers. We also saw some interesting news in the autonomous vehicle space with large deals and exciting announcements.If you missed my previous Hot Topics email, you can read it here.
We would love to hear from you and welcome your questions at any time. If you're interested in sharing your thoughts with us on hot topics, or if you would like to ask us a research question, please reach out to Katie Ramsburgh.
Hot Topics of 5/3/2021 - 5/7/2021
EV Charging Infrastructure
- Biden Wants 500,000 Charging Stations. How Will We Get There?
- Electric Car-Charging Business Is Doing Everything But Making Money
- Electric Vehicle Charging Station Companies Struggle To Turn A Profit
- General Motors has a solution for our crappy EV charging infrastructure
- EVPassport Launches First Open EV Charging Platform
- The Lack Of EV Charging Stations Could Limit EV Growth
- U.S. lawmakers make push for electric vehicles, charging stations
My thoughts:
Without charging infrastructure that meets the needs of all parties (personal and commercial vehicles), the EV rollout will happen much slower than most of the government and industry would like. This rollout can’t occur without detailed studies of where to locate and what type of charger is needed to meet the consumer demand. We don’t need to have infrastructure everywhere all at once, but instead, we need it where concentrations of EV usage will grow first. Infrastructure can then be extended outwards as demand increases. A strategic rollout allows investment to be spread over time. As our experience with the systems, workforce required and more to be learned and applied, each iteration will become better and more in tune with society's needs. Beyond this, we must be savvy about the business models for charging infrastructure to make sure it is easy to use and seamless to pay. Consumer education will be critical as the charging industry grows. Equity of usage will be very important, remembering that many US citizens do not have a credit card or bank account…again, let’s be smart.
Microchip Updates and Plant Shutdowns
- Ford slammed by new production cuts, but promises summer delivery of Bronco 'on track'
- EXCLUSIVE Facing chips shortage, Biden may shelve blunt tool used in COVID fight
- Some auto plant workers without pay as Stellantis shutdown hits 30 day mark
- GM extends downtime in Kansas, adds curbs at Michigan plant
- Rental companies buy up used cars as microchip crisis gets worse
- Car Companies’ Profits Have Outrun the Chip Shortage—but Not for Long
- Intel CEO says chip shortage will persist for ‘couple of years’
My thoughts:
Everyone is likely tired of fighting this fire every day and/or tired of hearing the same news played over and over, BUT I was thrilled to see the company’s profit reports this past week despite the semiconductor headwinds. Beyond this, it was interesting to hear some companies put out a profit warning for Q2 and beyond and some not. Mary Barra, in her comments, made it clear that her team is on every minute of every day to secure and balance supply to avoid as much disruption as possible. Supply Chain management is now the critical link in many companies, and, quite frankly, this group of talented people probably have never received the adequate praise they deserve for the critical role they provide. This clearly won’t be the case any longer. Supply chain talent demonstrating resilience will be in demand as never before. I wouldn’t be surprised to see more colleges offering degrees or certificates in this critical talent pool.
- GM expects strong first half of year despite production interruptions due to chip shortage
- Stellantis revenues up 14% to $44.4B in first three months of the year
- Ford swings to $3.3B net profit in Q1, warns of 50% cut in Q2 output
- BorgWarner doubles Q1 operating income
- Hyundai Q1 profit triples, to adjust May auto production due to chip shortage
- Tesla posts record net income of $438 million, revenue surges by 74%
- Magna more than doubles Q1 net income, improves 2021 forecast
My thoughts:
Although I mentioned this above, I’ll take a different approach here. The current situation is a supply and demand “perfect equation.” Limited supply and strong customer demand equal high prices, no haggling for discounts, and larger profits. SAAR at 18.1 also helped this a great deal. The impact of the shutdowns will be prevalent in the next quarter and on into the rest of the year. It remains to be seen how many customers will “take what’s on the lot” or decide “to wait it out.” Even though the vehicle is a mode of transit, there is still a “love affair” with personal vehicle ownership. If a customer “settles” for something they really didn’t want, this will come to play in future JD Power scores, which no automaker wants to see happen. There might be a double-edged sword in play here; time will tell.
- Hot Off The Presses: Defining Standard For Self-Driving Cars Gets Newly Updated And Released, Here’s What You Need To Know
- SAE refines levels of automation in push for system clarity
- Toyota is buying Lyft’s autonomous car division for $550 million
- GM expects to offer personal self-driving vehicles to consumers this decade
- Baidu Launches Robotaxi Service in Outer Beijing. How ‘Fully Driverless’ Is It Vs. AutoX?
- Ford-Backed Argo Sees New Sensor as Key to Self-Driving Cars
There are two key points in this week’s news: 1) Standards revisions and clarity and 2) Partnerships, mergers, and acquisitions.
- Much dialogue has ensued after the Tesla incident in Texas, and rightfully so. Customers need to be crystal clear about what their car can and can’t do and shouldn’t be confused by the terminology. Beyond making this clear in the SAE standards for the automotive community, the technologies utilized in the vehicle designed to be sure that the customer is engaged need to be quickly studied and standards considered.T here has been doubt and a lot of discussion over the past few years about IF the customer can really EVER be a fallback as they become accustomed to their vehicle's capabilities. Many of you who know me also know that I believe they can’t and shouldn’t. The redundancies and the car’s knowledge about the driver must supersede any requirement for the driver.This technology needs to be analyzed across the industry and standards established as soon as possible – we are already too late.
- It costs a lot in R&D to develop AVs, and, as such, the smaller players with reasonable IP will continue to be acquired by larger companies in need of that IP. If we ever want to achieve the cost levels needed to penetrate the market with AVs, these mergers are needed.Talent needs to be combined as well to have all the different skillsets required to make autonomy a reality.
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Best Regards,
Carla Bailo
President and CEO
Center for Automotive Research
Upcoming virtual events:
Book launch: The Road Forward
May 19, 2021 | 5:00 PM - 6:30 PM ET
Join Inforum and Inforum AutomotiveNEXT in recognizing the women whose wisdom is shared in the soon-to-be-published book, The Road Forward: More Conversations with Top Women in the Automotive Industry, published by SAE in collaboration with Inforum and the Center for Automotive Research. In this virtual event, we will hear from Sue Bai, chief engineer, division director, Honda Research Institute; Donna Bell, director, AV & mobility strategy, Ford Motor Co.; Mamatha Chamarthi, chief digital officer, Stellantis; Darci Marcum, plant director, General Motors Co.; and Kristen Tabar, group vehicle development & engineering, Toyota.
Following the panel discussion, you will be able to network with women featured in the book in a relaxed and intimate breakout room format.
WiM North 2021
June 23, 2021 - June 24, 2021 | 8:00 AM - 5:00 PM ET
WiM North is a regional conference for manufacturing professionals who are navigating the way through their manufacturing careers—whether it be in production, the C-Suite, or anywhere in between. This annual conference, produced by the Women in Manufacturing Association (WiM), offers attendees based in the northern region of the US with:
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