Automotive Ventures Weekly Intel Report | Mar 25 2024
Intel Report: The Weekly Mobility News That Matters
BY AUTOMOTIVE VENTURES | MAR 25 2024 | VIEW ONLINE
Why did we invest in Axion Ray? | Automotive Ventures
What We're Reading
The electric vehicle, a breakthrough achievement in automotive technology, has driven into this year’s presidential election, inflaming partisan fights that have come to define much of American culture. The political war over electric vehicles has been fueled by an incendiary mix of issues: technological change, the future of the oil and gas industry, concerns about competition from China and the American love of motorized muscle. And in the rural reaches of America, where few public charging stations exist, the notion of an all-electric future feels fanciful — another element to the urban-rural divide that underlies the nation’s polarization. | The New York Times ($)
How would BYD, China’s top carmaker, fare in America if free to roam? That’s anyone’s guess, but Australia might offer some insights. After entering the market in 2022, BYD now has 14% of Australia’s EV market. | Yahoo! Finance
No American car buyer today can purchase a Chinese brand’s electric vehicle. And no one is really sure when these EVs will arrive on US shores. But the prospect of cheap Chinese-made EVs is already causing sleepless nights in Detroit. | Bloomberg ($)
The price of electric cars is plummeting so fast that they’re now almost as cheap as gas-powered cars. | The Washington Post ($)
In recent years, hybrid vehicles took a back seat to fully electric vehicles, as automakers introduced many EVs to challenge Tesla. Now, the once-niche hybrid is the hottest car on the lot. | The Wall Street Journal ($)
The Biden administration issued one of the most significant climate regulations in the nation’s history, a rule designed to ensure that the majority of new passenger cars and light trucks sold in the United States are all-electric or hybrids by 2032. | The New York Times ($)
Bowing to consumer interest and softening demand for battery-electric vehicles in an election year, the Biden Administration has backed off its clean-air regulations designed to have BEVs comprise 50% of new vehicle sales by 2030. The final rule for Petroleum-Equivalent Fuel Economy Calculation softens the previous Biden Administration framework by adding three years to the phase-in of the new rule, cutting the PEF over that time by 65%, versus the previously proposed 72% by 2027, thus allowing OEMs to build more gas-powered vehicles through 2030 while still meeting the Corporate Average Fuel Economy requirements. This was crucial to maximize profits of ICE vehicles until BEV sales become profitable. | Wards Auto
Automakers lose about $6,000 on each EV they sell for $50,000, after accounting for customer tax credits. | Automotive News ($)
Bentley Motors is pushing back its plans to exclusively offer all-electric vehicles by the end of this decade due to changing market conditions and a delay in its first EV. | CNBC
In the electric vehicle race, it’s increasingly clear that not every competitor will make it to the finish line. Companies like Rivian, Lucid and Fisker are burning through their cash reserves as they spend heavily on expanding factory production and sales—all while losing money on every vehicle they sell. | The Wall Street Journal ($)
Pham Nhat Vuong, Chairman of Vingroup Corporation and founder of VINFAST announced the establishment of V-Green Global Charging Station Development Company, propelling Vietnam towards becoming one of the world's leaders in electric vehicle charging station density. | VINFAST
When Apple started working on revamped CarPlay software about four years ago, it saw the system as a way to beat back Android’s growing expansion into vehicles. Now that Apple has shelved plans for its own car, CarPlay has arguably taken on even more importance: It’s the company’s only hope of seriously cracking the automotive market. | Bloomberg ($)
According to AAA’s latest survey on autonomous vehicles, only 9% of U.S. drivers trust fully self-driving vehicles. | AAA
A study commissioned by the Clean Freight Coalition (CFC) is warning of a staggering $1 trillion price tag that they claim sets up a roadblock to the Biden administration’s push to decarbonize the industry. The study concluded that commercial trucking would have to invest more than $620 billion in charging infrastructure, with another $370 billion coming from utility companies to upgrade their grid networks to meet the demand. | Freight Waves
Auto insurance costs rose 20.6% from the prior year in February, matching January's increase as the most since December 1976, when costs rose 22.4% over the prior year. On an annual basis, motor vehicle insurance costs rose 17.4% in 2023, the most since a 28.7% increase in 1976, according to data from the Bureau of Labor Statistics. | Yahoo! Finance
Honda Canada plans to reduce the profit margin its Canadian dealers earn on vehicle sales up to 44%, equating to hundreds of dollars per vehicle, as the automaker moves into the electric era. The margin reduction was done without consultation and caught dealers off-guard. | Automotive News ($)
Honda will reduce U.S. dealership profit margins on new vehicles and make other changes designed to help support the company's costly transition to electric vehicles. The Japanese automaker's 0.5 percent profit margin reduction — affecting the amount between the invoice price that dealerships pay and the manufacturer's suggested retail price — comes with additional changes to marketing, advertising and service payments. | Automotive News ($)
Fisker said it would pause production of its electric vehicles for six weeks and raise up to $150 million in funding by selling convertible notes after missing an interest payment, as the startup tries to navigate a cash crunch. | Reuters ($)
As the world builds more and more electric cars and trucks—and electrifies other modes of transit—a race is underway to build the ideal, mean-and-green motor. Rare-earth elements like neodymium and dysprosium, which are required for the most powerful magnets for the latter, also represent a major choke point. Their mining and processing comes at an environmental cost, and China holds a near-monopoly stake in them. Which is why the race to build an EV motor without rare-earths is so important. | IEEE Spectrum
Boston Consulting Group (BCG) says that U.S. consumer acceptance of EVs hinges on automakers delivering four things:
20-minute charging times.
30 minutes maximum to find and wait for access to a fast-charging station.
350 miles or more of driving range per charge.
A price of $50,000 or less.
| BCG
The National Renewable Energy Laboratory estimates that by 2030 there will be 33 million EVs on the road and 28 million EV charging ports will be needed to support them. The majority of charging will be at home and work, with the public network for opportunity charging and less common long trips. | Energy.gov
The global software-defined vehicle market size is expected to reach $510 billion by 2030 as vehicles become more electrified. But a big question is whether legacy automakers have the internal talent to develop them and make them work as reliably and efficiently as upstart rivals. Chinese automakers, Tesla, Apple, and Google have that talent. But does Detroit? Japan? Europe? | Wards Auto
More than 5.8 million vehicles were affected by software-related recalls in the U.S. last year. 24 out of the 41 software-related recalls announced by automakers – or more than half – could not be fixed by an over-the-air update (OTA) and still required customers to take their vehicles to a dealer to be fixed. | Wards Auto
U.S. Sen. Gary Peters (D-MI) led a bipartisan group of Senators in supporting the DOT’s draft plan to accelerate Cellular Vehicle-to-Everything (C-V2X) deployment. C-V2X is an intelligent transportation system technology allowing vehicles, roadside infrastructure and nearby road users to share data and enable various roadway safety and efficiency applications. Those applications include collision prevention, traffic signal priority for first responders and transit vehicles, and improved school bus safety. | Transportation Today
There hasn’t been a commercial supersonic passenger jet since the Concorde stopped flying in 2003. Since then, supersonic jets — which travel faster than the speed of sound — have been used primarily by the military. But NASA's unveiling of the X-59, designed and built in partnership with Lockheed Martin, comes as a growing number of private companies are vying to bring back supersonic travel for the commercial market. | Washington Post ($)
We are launching more stuff into space than ever before: launching a record-breaking 2,664 objects into space last year, with the U.S. (American companies or government agencies) responsible for 81% of them. | Chartr
Shell is rethinking its business strategy to increasingly focus on renewable energy and electric vehicle charging. By the end of 2023, the Shell Recharge EV charging division was operating around 54,000 public charge points for EVs at various locations across the world. This was up from 27,000 in 2022. | Inside EVs
Shell's annual "Energy Transition Strategy 2024" report is available. | Shell
A new study concludes that making minor adjustments to the routes of a small fraction of airplane flights could meaningfully reduce global warming. Jets release heat, water vapor, and particulate matter that can produce thin clouds in the sky, known as “contrails,” in particularly cold, humid, icy parts of the atmosphere. When numerous flights pass through such areas, these condensation trails can form cirrus clouds that absorb radiation escaping from the surface, acting as blankets floating above the Earth. This cirrus-forming phenomenon could account for around 35% of aviation’s total contribution to climate change—or about 1% to 2% of overall global warming, according to some estimates. A small fraction of overall flights, between 2% and 10%, create about 80% of the contrails. So the growing hope is that simply rerouting those flights could significantly reduce the effect, presenting a potentially high leverage, low cost and fast way of easing warming. | MIT Technology Review
Stellantis announced a purchase of 8.3 million shares in eVTOL company Archer, in a deal roughly worth over $39 million. Stellantis already has a deal to manufacture Archer’s electric vertical takeoff and landing aircraft, which are set to launch in 2025. | The Verge
Not a single eVTOL company has demonstrated a single mission that met a “normal” predicted profile for range, speed, and payload. Not. One. | Air Insight
A new petition for trade relief and state support of the U.S. shipbuilding industry accuses China of distorting global markets in the maritime, logistics and shipbuilding sectors through “unreasonable and discriminatory acts, policies, and practices”. The petition seeks a variety of penalties and remedies to level the global playing field in shipbuilding and stimulate demand for commercial vessels built in the U.S. These include port fees on Chinese-built ships docking at US ports, and the creation of a Shipbuilding Revitalisation Fund to help the domestic industry and its workers. | Financial Times ($)
Since Russia’s invasion two years ago, Ukraine has revolutionized warfare with its use of drones in the air and at sea. Now it wants to do the same with unmanned ground vehicles, or UGVs, aiming to replicate the low-cost, do-it-yourself approach that it has used to such deadly effect. | The Wall Street Journal ($)
Tesla's second-generation Roadster will feature "rocket technology" through a collaboration with aerospace company SpaceX that will allow the sports car to accelerate from 0 to 60 mph in under one second, said Elon Musk, CEO of both companies. | Automotive News ($)
Have a great week,
Steve Greenfield
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Notable & New
Steve was quoted in an article on Carvana by Jamie Kitman. | Car and Driver
On this week's Future of Automotive segment on CBT News, we detail Automotive Ventures portfolio company Axion Ray and their $17.5 million Series A funding round, led by Bessemer Venture Partners. | CBT News ($)
Azumo believes that for vehicles, light is the new chrome. Azumo’s Nano-TFI has crossed a key threshold for invisibility and directionality to provide beautiful, efficient illumination for a variety of smart surface applications. | Azumo
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