This disruption will catch out many legacy car makers, with the shift skipping the anticipated interim step to hydrogen vehicles. This page explores all the factors making it difficult for legacy automakers, and will track major ‘legacy’ brands through the transition to see which, if any, survive, as new brands and Chinese brands gain market share.
It is No Longer all About Climate.
Car makers were expecting to be pushed to a switch to zero emission vehicles, and have been studying and making plans for years. At COP26, carmakers signed a pledge:
Together, we will work towards all sales of new cars and vans being zero emission[footnote 2] globally by 2040, and by no later than 2035 in leading markets.COP26 declaration on accelerating the transition to 100% zero emission cars and vans.
While not necessarily this soon, this is what car makers had planned for, was a forced transition to zero electric vehicles, driven by legislation, not consumer choice. A forced transition would allow migration of production on a scheduled timeframe, and any disruption is easily managed. Plus, if EVs are being forced on buyers, then legacy cars would be in even increased demand as the migration progressed, and there would be no risk of ending up with excess stock. Legacy models would continue to sell as long as permitted, because it was assumed people want these legacy cars. It would even be possible that consumer backlash could see the rules get pushed back. Surely laws would not move so fast that the threatened the highly important auto industry.
The problem for the established industry is, electric cars have reached a point where people want electric cars. Now the desirable cars are the electric cars. This was not the plan. This means still producing legacy cars for a long as legislation allows is, unexpectedly, no longer the clear path to maximum profit.
That the outright world car of the year award 2022 finalists are all electric cars, demonstrates the shift. It is now and anachronism that World car of the year awards still have a special category for ‘green car of the year‘, reflecting a time when a ‘green car’ winning outright was not thought possible. Green cars needed their own category as they were handicapped by being green. Yet now, in 2022, all three finalist for outright car of the year are all electric vehicles. Two of the last three years the winner have been electric, and now even all the contenders to win are electric. There are 6 awards categories in total, and only 6 of the 18 finalists are not EVs. Expect even less next year, and probably about time to make ‘world internal combustion engine car’ a special category. Even in the USA where EVs have been slower to take hold than in Europe or China, Motor Trend’s car of the year was the Lucid Air(electric) and truck of the year the Rivian R1T(also electric). The highest selling Porsche is the Taycan(their only fully electric model).
The climate push towards electric cars is still present, but it is not just one factor making the cars even more desirable, rather than something people suffer because it is the right thing. Overall electric cars are rapidly becoming the most desirable of all cars. At the current rate, no one will want anything but an electric car well before people are required to buy electric cars.
The result is moving from a ‘green’ driving disruption, to a ‘new technology disruption’, at a pace far faster than anticipated, and faster than many legacy automakers can deal with.
Rewriting History: What is a ‘car’?
Many articles quote a Mercedes as the first modern production car, such as the 1901 Mercedes 35HP, with the first patent for a car being awarded to Karl Benz in 1886. However, Benz only invented the internal combustion engine car. In 1837 the first electric car was built in Scotland by a man named, Robert Davidson. Electric cars were being produced all over in the 1880’s when the lead acid battery was perfected, and steam powered cars date back to the 1700s.
The car as invented by Karl Benz is only the the first modern car if internal combustion engine cars remain “modem cars” and “obsolete technology”.
Porsche designed the electric production car in 1898 Egger-Lohner C.2 Phaeton, and presented Lohner-Porsche Electromobile with electric hub motors in 1900. Early electric vehicles came to be regarded as just experiments as internal combustion engine cars took over, elevating the first internal combustion cars to the status of being the first cars, but if internal combustion cars go the way of the horse and buggy, and are consigned a niche of nostalgia and recreation, perhaps we need to rethink our view of history of the automobile.
History Doesn’t Repeat: Batteries Surpass Hydrogen Which Sends Shock Waves.
The 21st century was set to be repeat of history, and between the 1990s to 2010 the thinking was that battery EVs that were real cars, were as far in the future as flying cars. Just like in the 1800s, when the better range of internal combustion engine cars allowed them to relegate electric cars to a novelty, it was thought electric cars would remain ‘toys’ cars in the 21st century and hydrogen would power the any real cars that ran without fossil fuel.
The thought was, batteries were for niche vehicles, for example little cars very much like the first version of the Wuling mini-EV. The thinking was that the only practical solution to a replacement for fossil fuels vehicles was hydrogen. Getting Hydrogen cars right would take decades, and in the end the cars would not be so different.
The Nissan Leaf, first released in 2010 with a 21kW battery, was at the time considered a revolution and state of the art. This is what an electric car was good for, just over 100km (67 miles) of range if driven carefully and the motors were not powerful. Factor in that most people would want at least of 30km (18 miles) of range in reserve when they recharge, even if only driving in the city. At that time, electric cars did not look like a technology that could take over. Fast forward to 2022, and there are electric cars with over 500 miles/800km (Lucid Air), 600 miles/ 1,000 km (Aion LX, Neta S) even over 1,000 miles/ 1,600 (Aptera) of range, and the world is turned upside down. That always superior technology of the electric motor, suddenly, can now be used for real cars, and well before the industry was expecting such a change.
History of Car Companies And Countries.
Companies, and countries, have been through cycles of ascendancy and decline through the history of the automobile.
By country, it is a complex picture, but in a too brief oversimplification: Today, Italy still has a role in ‘supercars’ as does England, but now so too does Germany, who also rules the world of the ‘premium’ car. The ‘mass market’ is very much the territory of with Japan owning the mass market in many countries, sharing with VW from Germany, as well as France and Italy, although theses are falling back but still play a role in Europe, or with US brands in varying degrees around the world. Korea rose to emerge as potential ‘new Japan’, and European brands such as Jaguar, Land Rover and Volvo are in partnerships with India or China, despite no global brands yet emerging from China or India.
China, the worlds largest car market, has local manufacturers partnered global brands in joint ventures. The result is the world has not really heard much of the actual Chinese partners.
As an alternative to company valuations, here is a history of sales in units by brand.
Don’t Believe the Rhetoric: All Brands Know the internal combustion engine is dead.
Some brands have been in denial, but all know we are seeing the end of an era. But where you hear statements that have been made by Ford, General Motors and others that 50% of their vehicles will be electric by 2030, it should be understood that they are not saying what you think they are saying. The 50% they are still making will all be electric.
A History Of Legislation to end fossil fuel vehicles (bans).
I do not believe fossil fuelled vehicles (ICEVs) will ever be really ‘banned’ and a small number will be permitted long term, but as fuel stations close they will become practical only for avid enthusiasts, and no longer viable as normal transport. If too many still want them, taxes and fees will keep numbers acceptable.
Bans play a role in accelerating getting to the point where bans will no longer be required, but when the time comes, if the people still want ICEVs, then they would elect government who will allow them. EVs will will because they are desired by consumers, not because of bans, but bans can accelerate EVs fulfilling their potential to be the best cars.
Announced bans do force everyone to picture what is necessary to prepare for an EV future, and and a easier to sell than progressive tax increases that could be more likely to create backlash.
Strangely, Norway started it all, and it was very much triggered by the band ‘A-Ha’.
I am accruing a list of milestones in government bans on fossil fuelled cars, but please add comments on things to add to this list.
- 2016, June 4, Motor Trend Report: Norway Might Ban Sales of Gas-Powered Cars by 2025
The Global Car Market: 60..80 Million Per Year, But No Longer Growing.
The graph from iea.org and data are both downloadable from their website. The data is clear, the volume peaked in 2017, and has since started to fall. There are so many factors affecting the longer term that it would be worthy of an entire separate discussion, but in the next ten year, growth of over 10% from 2017 levels would appear optimistic, and a market growing sufficiently to absorb all the new players, is just not realistic. Either some existing companies will cease to exist, or will scale back in volume, or a mix of the two.
Car sales by country are available in more detail here.
2030 Market Mix Predictions And Manufacturer Targets.
Most car makers have predictions of the percentage of their fleet that will be eclectic by 2030. Since sales of anything other than EVs will only occur in fringe niche markets, to some extent this is prediction of the percentage of current sales they will have in 2030, although setting a 100% target does not guarantee maintaining current sales.. Reality is these percentage figures are continually revised upwards, but with 8 year remaining, there is a limit to what can be achieved.
I will update this table as I find new data.
|50%(21-05)||100%(21-05)||50%(70%in EU 21-06)||100%(21-03)|
The Market: Numbers By Brand.
Toyota and VW via for top place, and the top 5 produce half of the world’s new cars each year.
There is one major point to note, exception of Changan, numbers include sales cars by joint venture partners for the Chinese market, but not actually produced by the company. Cars for the Chinese market are produced by joint venture partnerships, with a Chinese partner making the cars, and the brand credited only getting normally at most 50% of the profit from the sales, in return for transferring manufacturing expertise to China.
Also note, that by 2030, Tesla alone plans to produce 20 million cars per year, which is more cars than Toyota and VW combined currently produce, and represent almost 1/3 of all the above sales.
EVs Completely disrupt the automotive industry.
Market Disruption: Will New players steal market share?
Tesla, Chinese Other New EV will Take 50% of the New Car Market by 2030.
These are not facts, just estimates, but by 2030, BYD will be the worlds largest car maker. Tesla may be a larger company, but behind BYD in cars, and focusing more on Robots than cars. Tech phone companies Sony, Apple, Huweii, Xiaomi combined with other new entrants to the global car market such as Rivian, Lucid, Fischer, Vinfast, XPeng, GWM, SAIC, Li Auto, and others to claim much of the rest of the market.
The existing companies will be squeezed out and as much.
There Is Insufficient Global Car Market Growth To Maintain Current Sales For Legacy Brands.
It is simple maths. If new players come and take over a slice of the market, then market share of the existing companies falls. So either all these new players fail, or the exiting companies.
The world population for those under 30 had already stabilised.
Electric engines have always had advantages over combustion engines, in terms of efficiency, maintenance, reliability and power. Consider street cars and suburban trains, where there has been access to electricity supply, internal combustion power. But until recently, lack of sufficient battery technology limited electric power to vehicles that could access power while on the move.
Now there is battery technology, and it is advancing rapidly. A hundred years of internal combustion technology has been leapfrogged in just over 10 years, with EVs now clearly superior as demonstrated by Lucid, Rivian, Tesla and Rimac. Where there is appropriate battery technology or other power, the internal combustion engine cannot compete. While it is easier to manage batteries for cars and consumer vehicles than for freight trucks, large ships and airplanes, but all seem headed down the path of electrification.
The amount invested in internal combustion engine technology has been enormous, but it looks like it must all be written off as a dead end. Bringing electric vehicles to mass production is still a huge hurdle, but, as Tesla has shown, the payback from overcoming the hurdle is huge.
This leaves companies with all those billions in internal combustion engine technology with a dilemma. When is the right time to make the switch.
Manufacturing Disruption: Less Labour Means Problems For Legacy Car Makers.
Tesla is swiftly improving built quality and looks set to achieve a production time of just 10 hours per car at its Gruenheide plant, Diess said Thursday in a prepared speech at a staff meeting in Wolfsburg. VW’s main electric-car factory in Zwickau needs more than 30 hours per vehicle, which should be reduced to 20 hours next year.Diess to VW workers: ‘I’m worried about Wolfsburg’
Seba says internal combustion cars have some 2000 moving parts, whereas EVs have something closer to 20.IEEE Spectrum.
With far less parts to be assembled in an electric vehicle, automakers have to rethink how they put cars together. A huge problem is that with 1/3 of the labour per car, they either need to build 3x as many cars, or they would need only 1/3 of the workers. Even if the carmaker does not lose market share and as a result produces less cars, there is still around 2/3 of the factory workers to be made redundant.
Revenue Disruption: The Pain Of Moving To Less Revenue Per Vehicle With EVs.
Less Revenue Per Car, But Profit Lower Costs Too, So No Problem If Sales Increase.
One of the highest value parts of an internal combustion engine car is the engine. With an Electric vehicle, the battery and electric motors take over that role. However, only BYD makes their own batteries. Carmakers are simply making less of the car/battery/engines overall package, so they keep less of the profits. In the end selling 100 EVs is the same as selling perhaps 60 or 70 internal combustion engine vehicles. The profit can be strong, as the labour is less, and there are so many less parts, that once the market reaches a similar scale as is no longer dealing with the costs that occur during ramp while demand is rising rapidly leading to supply shortages, the costs will be lower.
The Problem Is Almost No one but The New ‘Start-ups’ Will See Sales Increase.
For a ‘legacy’ automaker to increase sales, when new start-ups take 50% of the market, on average these brands will each see a loss of 50%. But some could lose all of their market, while others lose none. However, ever legacy company that retains more the 50% of their market, means others must lose even more of their market share.
Can any legacy maker be a winner? It is possible, but less than half of the market can be winners, and even that half would require all the rest to fail completely. So far, VW and Hyundai and perhaps Mercedes are potential winners, but the Chinese have not really hit international markets yet. If there is sufficient international tension, the Chinese impact could be reduced.
Asset And Finance Disruption.
Engine families are in production for decades, and all these assets must be written off. Even factories designed around internal combustions cars need to be largely written off as assets.
- A ‘start up’ EV maker gets investors to fund new factories and IP that will generate new revenue streams providing a return on the new investment.
- A ‘legacy’ car maker has to fund replacement factories and IP which will still result in less revenue than before.
Service Industry disruption.
The same factors the result in manufacturing disruption, also disrupt the service industry. Unlike manufacturing, which affects a select group of countries, every country has a service industry. That reduction to around 1/3 the labour to build an EV, also results in around 1/3 the labour and parts to service an EV. Either this industry, globally, sheds around 2/3 or all jobs, or the service industry will see closures.
German auto production employs around eight hundred thousand people — with a further 1.8 million jobs indirectly linked to the industry. But even these figures don’t convey quite how important it really is. Apart from the fact that brands like Volkswagen are known the world over, the sector drives industrial knowhow upon which the German economy’s strength relies.
The German economy, very key economy for the EU and Europe overall, is highly dependant on the automobile industry. As recognised in the article quoted above, as the industry goes electric, jobs will be lost even if German carmakers retain their market and market share.
The global car market has been shrinking since 2018. This is a key economic sector for Germany whose producers belong to the Top 15 carmakers worldwide. Yet they are running the risk of being outclassed and eventually replaced, given emerging actors in the USA and China.The Automotive Industry: The Achilles’ Heel of German Economy? (EU think tank)
These new competitors benefit from the growing digitization of the mobility sector, disruptive economic models and the obsolescence of vehicles with an internal combustion engine.
The reality is for German brands who represented around 20% of new car production in 2018 to retain their market share, the losses need to contained with other 80% of the market compressing to around 30% of the market. This means Germany needs significantly outperform legacy automakers from other countries in making the transition to maintain market share, and even if German companies do maintain market share, 2/3 of all jobs in the industry could be lost, and profits still decrease.
BMW launched both the hydrogen and electric vehicles very early. While hydrogen vehicles were only trials, the battery electric i3 and i8 EVs were both vehicles, with great potential that was never fully realised. This was in part because the market was not mentally ready when the vehicles were launched, and neither vehicle evolved at the pace to keep up with the EV industry as attitudes evolved. Both vehicles were ahead of the time, but by the time the marketplace was ready for their concepts, details of their execution were clearly in need of update. A well executed up to date new version of the i3 with good range, would probably be a great seller in the next few years, or even today, but it does not look like happening.
BMW seems to have become convinced the market is not ready for EVs as ‘real’ or mainstream cars, and in the manner of a company still hoping for hydrogen, and a company that has not yet realised that EVs now are the market. BMW executives have, in 2021, done everything from plead that EVs will be bad for the industry(possibly true), to they will be bad for the environment (not true).
Despite all this, BMW still has some competitive electric vehicles. However with iX3 basically an X3 made in by a Chinese joint venture partner, the i4 again a modified internal combustion engine, and the IX built on a space inefficient “can be used for anything”, the question for me is how much money will they make on these cars, and how easily can they ramp up production. BMW ranks surprisingly highly on global plug in vehicle sales, but a lot of that is from plugin-hybrids, which are starting to lose market share.
Further 40% of BMW sales in 2021 came from their joint ventures in China, and although under new rules they have been allowed to lift their interest in the JV with Brilliance Automotive to 75%, it is the JV with Great Wall that produces most electric cars and is the path to the future. Further, neither JVC does anything for jobs in Germany.
- My 2021 prediction is the mixed signals are not looking good for BMW. Expect sales by 2030 to be 1/4 of the current level, which means, unless they start making batteries and electric motors, revenue would be at only 1/8 the current level. If they keep making cars rated as well as the i4 and iX, they beat expectations to only halve market share so 1/4 or revneue, but Tesla, NIO, and perhaps even XPeng seem to directly compete with BMW, and are all already stealing their market in China, and in the case of Tesla, in Germany particularly after the Berlin Gigafactory opens.
- Further out, a “merger” with Mercedes, NIO or another Chinese partner, or an alliance or something with a technology/smartphone company may be necessary to continue to compete in the mainstream.
- 2022 May: Electric 3 series using BMW Neue classe by 2025.
- 2022 January: BMW working on new combustion engines
The reference for Mercedes Benz for 50 years has been the S-Class. And in the eyes of most of observers, Mercedes has already created an electric car in the EQS that not only already ahead of the S-Calls if many if not the majority of categories, but at the same time is less expensive than the S-Class. Notably though, from this comparison for ‘car of the year’ for 2022, it should noted that the range EQS range of 340 miles(547km) is less than the traditional S-Class with 442 miles, and much less than the eventual winner of the car of the year, the electric Lucid Air dream edition with a range of 520 miles (837km), proving that part of the way to win it to at least match internal combustion vehicles for range.
Still, this shows Mercedes is already capable of at similar price delivering cars high end cars to match the pinnacle of its, and thus will logically soon clearly surpass what has been able to previously achieve.
However at the lower price points, where status sometimes is less important, Mercedes vehicles far less cost competitive, and critically, less efficient.
However, with a 68 billion spending budget to spend on the project, and technology in development to deliver even more efficiency, Mercedes does have a logical niche going forward, perhaps just not a path to continue to be competitive with more mass market cars such as the A and B Classes.
- 2021: Mercedes has previously moved into higher volume markets with the A and B classes, and may need to retreat them. Like BMW, by 2030, the best they can hope for is 1/4 of current revenues.
VW: The Mass Market.
Herbet Diess has taken steps to have the VW group in the best position of the all the German players, but as the highest volume German car makers, he does have the most difficult task. Further, the complex oversight structure where the unions have representation on selection of executives has added to the challenges. Being open about the need to reduce hours per car has lead to calls for VW to stay with internal combustion engines in order to retain current staffing levels. However with Germany already at 35% plug in vehicles, and headed to 50% during 2022, without a ban on EVs that is unlikely, abandoning the move to electric would just ensure the failure of the company. Still Herbert Diess was moved from full CEO to partial CEO to address the concerns on electrification. How well VW survives the transition hangs on how this power struggle ends.
The right moves are still partially happening, with a new factory to replace the more traditional legacy car manufacturing and produce cars with a target of 10 hours in place of 30 being approved, although not exactly as Diess would have chosen.
- VW to perform best of all legacy car makers if Herbert Diess remains through to end 2023.
- Longer Term, VW could merge with Tesla, as the Teslas target of 20 million cars by 2030 would be far easier with VWs brands and their loyalty, and very difficult if VW can retain close to current market share.
Tracking the announcements:
- 2022 August: Even with a new CEO, Volkswagen is still determined to become the world’s largest manufacturer of electric vehicles.
- 2022 May: VW CEO Expects Tight Battle To Overtake Tesla In EV Sales By 2025(video)
- 2022 March: https://cleantechnica.com/2022/03/20/porsche-ramps-up-its-electric-car-plans/
Things look far more problematic for Japan than for Germany. Firstly the brands do not have the same cache or history, secondly Toyota, the dominant player in Japan, is in a far worse position with EVs than VW, the dominant player in German. Japan is behind because its “leader” Toyota, had a plan that it would be hybrids until at some future date hydrogen became viable, and the industry and consumers would move only when they were pushed. It was only around December 2021 when Toyota leaders seem to reveal they have had an epiphany, and now realise, EVs, are going to take over because they are now able to out compete internal combustion cars.
But this is late, leaving Japan already behind competitors, and as the Japanese economy is just as reliant on the car industry as is Germany, Japan needs to do some serious planning to limit the damage.
Toyota: The Industry Giant Facing A Challenge.
Toyota and Electric: A Love Hate Relationship.
I have previously labelled Toyota the “anti-ev company“, and my first impression of their hydrogen car plans were that Toyota only was funding hydrogen cars to delay the move to electric cars. Looking back at the history, it is clear there was a time when battery technology was just not up to the task of enabling electric vehicles to provide a path to zero emission vehicles. However, Toyota, or at least their president Aiko Toyoda, became a victim of sunk cost bias and adopted any opportune argument to delay the adoption of electric vehicles.
Toyota Zero Emission Pioneer.
1997-2003: Rav4 EV Compliance Car .
The 1997 Rav4 EV had a 27kwh battery, and an EPA range of 95 miles or 153km. All of this sounds impressive compared to the 2010 Nissan Leaf arriving 13 years later with a range of 73 miles or 117 km from a 24kwh battery.
- The Rav4 EV was a “compliance car” produced at a loss in very limited numbers.
- The 1st Gen Rav4 EV was very slow, 18s 0-60mph, only achieved the range by being slow, and was very slow to recharge.
- Toyota’s other ‘compliance‘ zero emission vehicle, a hydrogen car, had far better range, better performance, and was faster to recharge, possibly a major reason for Toyota adopting a Hybrid and Hydrogen strategy.
1999-2021: Hybrid and Hydrogen Strategy.
The Toyota Prius, launched in 1997 in Japan by 2001 in the US and other international markets, gave Toyota a positive reputation with environmentalists, and those who wanted to be seen as environmentally responsible.
Ever since, Toyota has focused on hybrids for today, and hydrogen for “one day” as the company plan. Even plug-in hybrids have not been endorse by Toyota with “charge by gasoline” hybrids, that Toyota cleverly/cynically markets as “self charging hybrids”.
By aournd 2017, the luste from the Prius had stated to wane as it became clear in in tru green credential, Totoay was lagging bheind.
Toyota Electric History: EV Pioneer to Laggard, And Back?
However, there are other questions on Toyota’s ‘green’ history, and despite the seemingly environmentally friendly although complicated and expensive for the performance Prius, Toyota has been the only brand in the US to increase average fuel consumption of its fleet.
Despite the association of Toyota and the Toyota Prius hybrid with its history of having been championed as environmentally friendly, Toyota has a chequered history with electrification that includes:
- 2021 Jan: Were among the largest donors to Republicans denouncing the 2020 election.
- This was because the candidates are also those pro ‘big oil’, leading to call for boycotts of Toyota.
- 2021 March: Lobbied against electric vehicles (report March 2021)
- Claimed Electric Vehicles would mean the end of the Japanese car industry.
- 2021 September: Environmental, health, auto groups urge Toyota to stop opposing Biden’s push for more electric vehicles
- 2021 September: Repeatedly predicted EVs would lead to huge job losses in Japan.
- 2021 November: Has been declared the worst automaker in the world by Greenpeace with respect to green vehicles.
- 2021: November: Identified 3rd worst of all companies for the environment, only surpassed by Exxon oil and Chevron oil.
- 2021 November: Started an alliance for the continued production of internal combustion engines.
It goes, on, and I could add more, but hopefully this is enough he convey the point.
Toyota: No3 Worldwide In Companies Negatively Influencing Climate Action.
Toyota Motor has campaigned against proposed regulations globally to phase out internal combustion engines in favor of electric vehicles in 2020-21 and ranks 3rd on InfluenceMap’s list of global companies most negatively influencing Paris-aligned climate policy. It is joined by BMW (18th), Daimler (24th) and Hyundai (25th) from the automotive sector, which as a group is highly negative on stringent climate regulation on the automotive sector.The 50 Most Influential Companies and Industry Associations Blocking Climate Policy Action Globally
Only the largest American Oil companies block Toyota from 1st place. Toyota, currently the largest, and richest, manufacturer of internal combustion vehicles, sees electric vehicles as a significant threat. While hybrids increase car complexity and cost, battery electric vehicles remove the most complex parts of a car, the internal combustion engine, gear box and cooling systems. While you might think governments would not force consumers to buy more expensive cars as EV prices inevitably fall, Toyota in Japan has a government that already forces consumers to keep buying new cars in a planned obsolesce program to support the automobile industry.
Toyota is so concerned about the job loses in Japan from the move to electric vehicles that it has even formed “team Japan” to help keep the combustion engine alive. See “Toyota: The Anti-Electric Vehicle Company” for more, but Toyota is calling out that progress is bad for corporate profits and lowering prices is bad for economic activity. EVs can be built with 1/3 of the labour hours of building an ICE vehicle or hybrid, and Toyota argues that would be disaster for jobs in Japan.
The Hybrid Addiction.
Labour can be cut from 30 hours building cars with processes designed around internal combustion engines, to 10 hours for an EV. Toyota is master of building hybrids, which have the complexity of both powertrains one vehicle, Is any wonder why Toyota spent so many dollars advocating hybrids as a greener solution than moving asway from fuels?
From December 2021: An Electric Epiphany?
Then articles started to appear suggesting Toyota was trying to get serious about electric cars.
“Two million is a huge number and now we’re saying 3.5 million as a baseline, but people will still say [it’s only] 3.5 million out of 10 million annually.”Toyota CEO: December 2021.
So the latest prediction is 3.5 million cars per year by 2030. Critics suggest that means Toyota is sill planning to sell 6.5 million non-ev cars, and that will lead ot big losses.
While ramping up production does take years, as does fully converting factories and securing battery supplies, at this time 2030 is 8 years away and there is time to further increase that target. Of course, given all the competition, where something has to give as far as market share, if is very likely that Totyota could drop back to 5 million cars per year annually from the current 10 million per year, if it fails to pull a rabbit out of its hat.
It has been suggested Toyota has ground breaking solid state batteries, just waiting in the wings to be released any time from 2022, through to 2025, that revolutionise the industry. However, many reports say these batteries will first exist in hybrids, which remain Toyota’s favourite solution.
Toyota is one of the most difficult car makes to predict how they will handle the transition. Currently Toyota claim production reduction is due to semi-conductor shortages, but with several key markets such as Europe and China already around 25% EVs, it is hard to see how Toyota, with no current EV products, can avoid a drop in sales.
I suspect Toyota will lose more than 50% of their current volumes by 2030, and perhaps little more than the projected 3.5 million cars will need to be produced by 2030.
- 2021 April: Shanghai Auto show (pre-epiphany):
- 2021 December (revealing the epiphany):
- 2022 March:
- Toyota BZ3/4, some say largely engineered by BYD, is set to release late 2022.
- BZ3/4 release only China at this time
- 2022 April
- BZ4X US pricing announced (not particularly competitive, but there are not many to sell anyway)
Honda / Sony.
Number 6 on the top 15 list, Honda looks in the best position of all Japanese car makers though its partnership with Sony. Honda, the most recent entrant in car making of the Japanese in the top 15, has risen already above all but Toyota, and will likely continue to rise.
Up until the Sony partnership, it was clear Honda suffered the “EVs are city cars” syndrome, although the Honda e, they have tired to make a ‘city car’ or ‘urban car’ that is desirable.
It’s the Urban EV Concept that became a legend, the legend that became a prototype and the prototype that became the dinkiest, most desirable car since the Suzuki Jimny. It’s the Honda e, Honda’s first mass-market, pure-electric car (yes, Honda dabbled with the EV Plus in 1997, but only around 350 of those were ever built), and we want one.Top Gear: Honda e review
The problem is, this is hard likely to sustain them until 2025, when the Sony partnership is scheduled to bring their first “real car” EV to market. Sales are falling, and it may get worse. Honda also has an emissions problem in Europe, where it is has needed to purchase emissions credits from Tesla to stay afloat in the EU.
By 2025, Sony could be the senior partner. Prediction: Sony to control Honda.
- 2022 April 12 Plan to launch 30 EVs by 2030 and phase out internal combustion by 2040, but perhaps not hybrids.
- “By no means is this the end of hybrids and the replacement of all hybrids with EVs,” Mibe told the presentation. “We will develop our current hybrids and use them as a weapon in our business.”
- june 6 Sony and Honda’s EV venture to become independent company
Still at number 7 of the top 15 in the car market, Nissan does not appear healthy going forward. Despite their long history with the Leaf, their second EV, the Ariya, is taking a long time to arrive. Nissan are in the Renault /Nissan / Mitsubishi Alliance, and they do share platforms, but this “alliance” does not seem to have the full benefits of a “groups” like Stellantis, and Nissan sales are falling , and all three partners seem to be struggling, despite all three having early entrants in the EV marketplace.
Nissan does nave long range plans, including solid state batteries by 2028, but seems to have too much inertia to change to EVs fast enough now they have finally arrived.
The Ariya launching in 2022 is should gain sales, but is late to have a big impact, and the Leaf, despite at one time having a market to itself is now completely outdated.
It doesn’t make any sense for Nissan to still be selling the LEAF with a CHAdeMO plug. They really should have switched to the CCS plug with the refresh so that customers would have expanding charging opportunities for the life of the car instead of being left out in the cold.
But, the continued lack of liquid cooling (a major problem I’ve had with anything but around town driving in my LEAF) shows us that Nissan really didn’t mean for the LEAF to ever go on road trips.Still no CCS in 2023, the leaf is only viable as a city car.
Following in the footsteps of other automakers, such as Volvo, Volkswagen, GM or Mercedes, Nissan is announcing a plan to cut most funding for new internal combustion engines. The company will still develop the engines it already has, especially in order to comply with the stringent Euro 7 emissions regulations coming in 2025.InsideEVs Feb 2022: Nissan To End ICE Development Except For US Pickups And SUVs
I think Mazda is in big trouble. The MX-30 is another “EVs are city cars” syndrome car. With the range extender rotary engine, the MX-30 could becomes a far better car, but hard to see it as a plaform of the future.
Looking ahead, Mazda plans to launch a second scalable platform called Skyactiv Scalable EV Architecture that will underpin several products “with various vehicle sizes and body types.” It’s too early for the firm to provide additional details because the cars built on it won’t arrive until 2025 at the earliest. Some will launch as late as 2030. By that point, Mazda predicts its full product portfolio will feature some degree of electrification, and that EVs will represent about 25% of its global sales. It will be interesting to watch which side of the graph the MX-5 Miata lands on.June, 2021Mazda announces 10 hybrids and three EVs built on the same platform
To be added
The Automobile divisions of Mitsubishi seem to have has been in a mess for some years now. Looking at reviews, it would seem with the updates, the 2022 (2023 USA) version of the PHEV Outlander is still competitive in the market, as could be the case with the Eclipse Cross, but the range of competitive vehicles is small. From what I have seen, annual sales halved since 180,000 in the year 2000, to less than 90,000 in the year 2020, but with a rebound to 102,00 in 2021. This is a small base for launching into EVs.
No McLaren or Ferrari here, as they are not volume brands, and no Tata as it is not a global brand.
Jaguar/ Land Rover (India – UK)
Jaguar broke ground with iPace which on release won car of the year and was extremely impressive. Since then all the reports are of declining sales for iPace, but in reality, even bigger decline for the brand overall. The iPace is marred by high price, slow peak DC charge speed and being inefficient, but is still quite an impressive car, showing that one EV cannot save a brand.
Jaguar I-PACE Sales Continue To Decline In Q1 2022 (but share of Jaguar sales increases)
Stellantis plans to invest at least $35.5 billion (30 billion euros) in vehicle electrification and new software/technologies through 2025
Hyundai / Kia
- Hyundai & Kia Plan Electric Car Ramp In Korea
- Korean carmakers close factories in China as Q1 sales plummet 40%
- 2022, July 11: added overview and list of government bans.
- Minor Revisions 2022, June 6
- 3rd Edition: 2022, March 20: 2022 Started on other brands
- 2nd Edition: 2022, March 10, added Japanese story including Toyota
- 1st Edition: 2022 March 3, general story, but German brands only.
- USA to be added
- Hyundai group to update
- Update history for rise of ICE and hydrogen history to reflect ‘killing of electric car’.
- Targets/predictions table to link to manufacturer event log data below.
- Toyota history to link to Toyota enigma page.