Comment by bryanlarsen | Hacker News Reader

Comment by bryanlarsen | Hacker News Reader

They've still got time given their reputation.

In 2024 it's borderline OK not to have an EV business. EV's are 10% of the American market, 25% of the European market and >50% of the Chinese market. The Chinese market is probably lost anyway due to the insane local competition, so concentrating in 2024 on the larger share of the market outside of China is reasonable.

Let's say that the flipover point is 2027.

And let's say it's 2027 and you're looking to buy an EV. You narrow down your choice to a 3rd generation Tesla, a second generation Ford or VW and a first generation Toyota or Honda. Reliability is the deciding factor. What do you choose? Lots of people are going to choose a Japanese brand despite any drawbacks getting a "bleeding edge" model entail.

By not ramping up EV production gradually they're setting themselves hard production and logistics problems. All new production processes have teething problems, and they're a lot easier to solve when production is in the 5 figures rather than when it is in the 7 figures, but if anybody can solve hard production and logistics problems it's probably Toyota.

Isn't it very likely that Chinese brands will also feature in the decision? From my sporadic reading here and there it seems they will be able to compete on price globally sooner rather than later.

It seems that people are not able to process the shock for the Chinese entrance to the automobile market. I have seen the Zeekr. It's simply insane. The price is competitive. The quality is competitive (I find it superior to VW and rather competing with BMW/Audi). China also can build stuff at large scale. Now, is it reliable for 5-7 years? That's still not known but we are about to find out.

How long will other countries allow Chinese companies to sell there when non-Chinese companies face much stricter rules when selling in China? Not to mention the perks like state banks providing financing, forgiving missed payments and doing loan rollovers repeatedly, etc. Everyone provides support in some form or another but China provides the most (on a relative basis).

For my part I'd like to see China increase imports to balance trade so it becomes sustainable. That will result in the best outcomes for everyone.

I mean, they build Teslas don't they? The IP goes around. Cheap/forced labour and half command economy definitely help.

But it's long not the "buy the cheapest and of good quality anymore" world, considerations like "whom am I working with / contributing to" are a factor

I had the same thoughts a few years ago.

The winner will not be the first one to the market, but the one at the right time with the best car on the market.

Actually neither. The best car is the one that you can actually buy. That requires manufacturing, logistics and supplies. The likes of Toyota have barely begun the process of getting organized there. Even if they had an amazing EV product (which so far they don't), they'd struggle to sell a lot of them because they simply don't have factories, battery supplies, etc. in place that they would need for that. And at the scale they operate anything that doesn't sell in the millions of units is not worth doing. Getting from zero to there will take them quite a bit of time and money.

Which is why the winners in this market so far are Chinese and Korean manufacturers. And Tesla. Unlike other manufacturers they have manufacturing dialed in and a robust supply line with batteries and other things they need. Their main challenges are keeping up with demand and keeping cost low while growing manufacturing capacity.

The pace at which this market is growing means that it is getting harder for the likes of Toyota to break into this market. The few EVs they have on the market are actually not made by them and also a bit underwhelming. For example the bZ4X is actually a BYD car with a Toyota logo. That might be their future: leave the manufacturing to specialized companies and simply milk the brand. They seem to still insist they'll have their own drive trains and supposedly amazing batteries. But so far there's little sign of them building factories for those. Maybe that will work for them.

> EV's are 10% of the American market

Ah, no. EV sales in the US are slowing with dealerships having large amounts of unsold inventory, as documented below:

https://www.usatoday.com/story/money/personalfinance/2023/11...

https://www.cnbc.com/2023/11/01/why-dealers-say-ev-sales-hav...

The total percentage of new cars being sold as EV is about 7.9% in the US for Q3 2023.

https://electrek.co/2023/10/12/ev-sales-7-9-us-market-volvo-...

https://www.coxautoinc.com/market-insights/q3-2023-ev-sales/

That sounds great, until you realize that new car sales have slowed significantly due to the economy and high interest rates; meaning that wealthy people have outsized buying influence at the moment.

https://www.marketplace.org/2023/03/06/new-car-sales-have-sl...

This has caused dealerships to warn Congress that they believe EV purchase orders will decline in percentage when interest rates decline and the middle class starts buying cars in greater quantities again; making the Congressional recommended deadline unfeasible.

https://www.teslarati.com/car-dealers-biden-ev-demand/

Despite the above, EVs and Plug-in Hybrids combined register as only 1.2% of all vehicle registrations in the United States.

https://www.visualcapitalist.com/visualized-ev-market-share-...

EV adoption is still increasing. The rate of increase has decreased.

Oh, no doubt, but the parent's comment about a potential flipover in 2027; that is, in my opinion, with the sources cited, wildly optimistic.

I am personally in the camp that believes, because of the geographic area of the United States and people's families (very different if all your friends live in Spain, and you live in Spain, versus California to Chicago); EV adoption in the US will be much more strained than Europe or China (as in China, 60% of the population lives in 12 coastal provinces and most of the family stays together). I could see the US easily being a decade or more behind, not because we're stupid or backwards or lazy, but because our requirements are different.

For the US; I think Plug-in Hybrids are a fantastic option that should be encouraged. They completely kill the arguments or concerns about range anxiety; and, what, 80%-90% of all miles travelled will be electric? Don't let perfect be the enemy of very good; especially when far more people would be willing to sign up. I think it's fine and reasonable to get 80% of the way there with broad adoption, wait a decade or so for EV technology to be even better and go further to where nobody has concerns, and then transition to 100%. Forcing people into premature technology ruins first impressions and sets stereotypes that will never die.

Hard to pinpoint a year. It's nearly impossible to figure the economic conditions in 2027 and determine if demand for new cars will be high or if there will be heavy (and high profile) investment in charging infrastructure.

Flipover in 2027 is highly unlikely in the US. Flipover worldwide in 2027 is highly likely because China is a much larger market than the US and has already flipped, because Europe is way ahead of the US and because the rest of the world is going to switch to $10,000 Chinese EV's quite rapidly.

> $10,000 Chinese EVs

That sounds like a safety nightmare.

They're a heck of a lot safer in crowded pedestrian conditions than the typical US oversized SUV.

And the $8,000 BYD Seagull has passed European safety testing for highway speeds.

I meant in terms of fire; I'd be concerned that if Tesla can't stop occasional spontaneous combustion, how about a cheap Chinese EV...

> typical US oversized SUV

I actually don't know if people will go back from SUVs even if there are better cars. They just feel psychologically safer to the passengers and the large cargo hold is convenient. If you took them away from people, I think there'd be widespread anger at EV's expense which is not needed right now.

A cheap Chinese EV uses LFP batteries, which have a much lower fire risk than Tesla's nickel batteries. And Gasoline cars have a 10X higher risk of fire than a Tesla.

Tesla is using LFP batteries in many of their cheaper, lower range vehicles. Just not in the US market since the batteries are sourced from China, and that reduces their EV tax credit.

Hybrids are much more complicated, and thus will be more expensive all things being equal. Once EVs break out of their current weird artificial premium only market segment, and are available at their natural price points like the cheap Chinese EVs, then they should be much cheaper than hybrids. I suspect all these range anxiety and geographic arguments will be proven irrelevant for most people, once the cars are cheaper.

> For the US; I think Plug-in Hybrids are a fantastic option that should be encouraged.

They are for the consumer. The Volt is a fantastic car.

Hybrids are a disaster for manufacturers. GM killed the Volt.

The manufacturing cost difference between the Volt and the Bolt was simply far too large.

The manufacturers are way better off putting the price difference into a larger battery and dumping the combustion side.

I found it interesting that even in Norway, the total share of EV is just below 25%. https://www.vox.com/future-perfect/23939076/norway-electric-...

Total fleet will obviously take a while to turnover, 93% new of passenger car registrations in September were PEV, 87% BEV, Norway has long led the world though in this area with very strong incentives for many years.

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