Hot Topics of 4/5/2021 - 4/9/2021

Biden EV Proposal and Emissions Goals

• Electric vehicles get help in Biden plan, but roadblocks remain
• Biden plan calls for $100 billion in new EV consumer rebates: email
• Biden EV plan aligns with goals of industry
• Biden faces tough choice over a battery plant in Georgia
• Biden's EPA chief vows tougher tailpipe rules by July, unwinding Trump regs
• Biden wants to build a national EV charging system under $2 trillion infrastructure plan, but it won't be easy
• Will Biden's $2.3 Trillion Infrastructure Plan Usher in Era of the EV?

My thoughts:

President Biden has drafted an extensive push towards electrification, which he talked about during his campaign and is now making happen. Expanding beyond this, the National Academies of Science, Engineering, and Medicine recently issued a report that includes recommendations for CAFÉ for 2025-2035. Both of these align well with the Paris accords and push for an improved better carbon footprint for the USA. There will be negotiations, and some of this will be slightly watered down when passed through the legislature, but the automotive community supports this direction. Many EV products and manufacturing facilities are being announced with significant investment. These developments will address products and infrastructure, BUT developing customer demand is key to their success. In this regard, as an industry, we must address what we can do to inform consumers about EVs better, how they will meet the needs of their daily lives, the consumer's total ROI, and total cost of ownership, amongst others. We need to allow our data to be utilized to determine how to manage and position charging stations to meet the growing demand. We need to push for charging in multi-unit dwellings. The customer is king, and without them, we won't meet the goals that we know are necessary for our air quality and health.

Q1 2021 Reports:

• Detroit Three automakers post first-quarter sale gains; foreign rivals surge, too
• US Q1 Vehicle Sales Impress: Will Momentum Sustain in Q2?
• Tesla reveals record quarterly sales despite supply chain struggles
• First Month Of Volkswagen ID.4 Sales Beat The Mustang Mach-E
• Volvo Car USA posts tenth consecutive month of growth and best March result in 14 years

My thoughts:

Sales numbers in the first quarter remained impressive despite rising prices and lower incentives. Inventory levels continue to dwindle, which, at the very least, poses a risk for the remainder of Q1. High-demand models are becoming in short supply, and specific options may not be available, which will cause customer discontent.  My point here is not to be a downer but to be cautiously optimistic. Many obstacles can become barriers depending on several factors that, as an industry, we need to consider and weigh those options to satisfy the customer again. EV sales continue to improve month over month, and this is a good sign for the EV push needed for all manufacturers. The pandemic has made many people realize that they may not need a vehicle for all their previous uses – daily commutes may be a thing of the past, and an EV can fit nicely in their daily lives.

AI and Emerging Tech

• What if we get tech right?
• VW Comes To Detroit To Develop Its Artificial Intelligence
• Magna's camera-based technology helps take the “distracted” out of driving
• Automotive Radars Get a Touch of AI: Report
• Op-ed: Using AI to help solve today’s semiconductor problems
• Ford-backed Argo AI mulls going public this year, report says

My thoughts:

AI is a topic that is often hotly debated. Witnessing the most recent robots and their capabilities can be a startling sight – they look and act downright human. Still, they are programmed by humans, so most do realize the limits of their actions. AI is part of everything in our lives today if we know it or not. Our phone, laptop, buying habits, and websites frequented all provide our data, which then goes to computer algorithms for firms to understand us better and market to us or send us material to continue to stoke our interest. We can’t live in a bubble, and we do need to be aware of these activities. Often, we should stop and think before we google something or shop on a specific site.  Especially now that I’m in my “golden years,” I see more targeting of older folks. It’s easy to see how one can be hooked and swindled.

On the other hand, AI can improve our technology, make our lives easier, and make our world safer. The more we have data analysts who seek to use this data towards these aims, the better. We do have a shortfall of this skill set, and we need more colleges and universities doing this type of data analytics training. This talent development will help to offset the data users out for malintent.

Continued Parts Shortages

• U.S. Senate readying legislation on semiconductors, Biden says
• Industry is now hurting for supply, not demand
• U.S. auto industry calls for government help on chip shortage
• Automakers could make 1.3 million fewer vehicles because of semiconductor shortage
• Global Microchip Shortage Cuts Ford Production By 44,000 Vehicles In One Week

My thoughts:

The parts shortage will not go away quickly for many reasons. As we know, President Biden is taking action to try to remedy this situation for our US industries. It will take time to prepare manufacturing facilities even if we offer incentives to those currently producing semiconductors. 

News outlets report that this could cause more shortfall to the automotive industry than the pandemic did in 2020, so the industry's clear actions in totality are needed. Cooperation amongst automakers and suppliers will help clear these hurdles. CAR has written an excellent Op-ed on this subject, which is awaiting publication.

Factory Zero and Hummer Announcements

• GM's Factory Zero plant in Detroit to get more EV product
• GM confirms electric Chevrolet Silverado pickup to follow Hummer EV
• Hummer’s new electric SUV can drive diagonally, with 300 miles of range and a $110,000 price tag

My thoughts:

Factory Zero is great news for Detroit for sure. Factory Zero is vital to the community and employment. GM and the state of Michigan will work together to create the training needed for the skillsets required to manufacture these products.The Hummer EV is an electric beast that should convince customers that EV’s ARE REAL TRUCKS! The development of these classic trucks as EVs will help with the consumer acceptance piece, which I talked about earlier in this note.

But, we need to make EV’s affordable and part of ride-sharing services to ensure mobility and equity for all. EVs should not just be a luxury for the upper-middle class but should also meet the fundamental needs of all. As an industry, we need to strive towards this goal.

Best Regards,

Carla Bailo
President and CEO
Center for Automotive Research

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