A Kodak moment for GM

Mary Barra, CEO of GM, recently stated that GM will not be able to build a profitable $40K BEV until at least 2030. This means GM is a whopping 6 years behind Tesla and possibly BYD when it comes to building and selling battery electric vehicles. Six years.

Kodak dominated the camera industry until photography went digital. Cars are now becoming digital devices. Goodby GM.

Meanwhile, Jim Farley the CEO of Ford recently described the software nightmare facing traditional automakers. Today’s cars have on the order of 150 electronic control units (ECUs) that control various car functions, from seat warmers to power steering. Carmakers traditionally outsource these ECUs to a number of different of companies who all used different ECU control programs. The result is that not only is it very difficult to integrate these ECUs into a central operating system that will allow stuff like over the air updates, but it also means Ford has very little understanding of the software running their vehicles.

Farley’s solution is to vertically integrate. Ford needs to make its own ECUs and more importantly write its own software, which is what Tesla has been doing for the past decade. Unfortunately, software design is something Ford doesn’t know how to do. Yikes.

Elon Musk may be coming to the rescue by offering access to the Tesla automotive operating system. Ford and Tesla seem to be cooperating a lot lately, which may be the best way to compete with all those Chinese automakers.


Farley is probably looking more at the margins Apple makes off it’s proprietary OS. What is Apple’s margin on a PC, compared to a commodity Wintel machine? Of course, in his quest for ever fatter margins, Farley is probably missing the point that Apple is a cult, Tesla is a cult, but Ford is not a cult.



Well more like they dominated the film, paper and chemical parts of the photography industry. Maybe even the low end single use cameras.


The similarities are incredible!

GM produced the first mass market modern EV

Kodak invented the digital camera

The Captain

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First: Great post. Thanks for the effort.

Beyond that, gaining control of their vehicle electrical architecture will be just one element of the solution. They (Ford) are building a battery factory with a battery supplier and that will help also. They are also aided by a focus on developing just a few different types of vehicles. GM (Mary Barra) is idiotically pursuing a strategy of introducing a slew of BEVs, reducing their engineering focus and enormously increasing the complexity of operations… while reducing economies of scale. Be sure to keep popcorn handy because it’ll be really interesting to watch Ford struggle to get it’s act together… while GM works mightily to jump off a cliff.

Don’t even get me started on the Japanese car companies… (smh)

He is no fool who gives what he cannot keep to gain what he cannot lose.


Forget margins, this is about survival. Farley is trying to find a way for Ford to still be a significant company in 2030. Separating the EV and ICE businesses was a good first step because it allows the latter to go bankrupt as ICE sales decline while spinning off the hopefully someday profitable former.

Problem is that Farley has largely admitted that Ford cannot compete with Tesla in production cost for the foreseeable future. That pretty much leaves focusing on markets that Tesla has not entered, e.g., traditional trucks and commercial vehicles, while getting as much tech from Tesla (chargers and software) as possible in order to not be left too far behind.

Yup. IMO, the primary factors driving car consumers are cost, performance, and quality. Everything else is fluff. When the technology is mature, as with ICEs, analog phones, and socks, there is little difference in cost-performance-quality among manufacturers. That’s when fluff matters. Until then it is all about production cost and product quality.

We can see this empirically with BEVs. Norway is the only mature electric car market with 80% adoption. There are probably at least 100 electric car models selling in Norway, including the major Chinese brands. Yet Tesla has about 25% market share on the strength of only two models.

It may all come down to whether Toyota can make solid state batteries work. A plug-in hybrid with 200 mile EV range and <5 min charge time could be popular, particularly in rural states and countries where the electric infrastructure is less reliable. I wouldn’t count Toyota out yet.

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I agree on the financial manipulation part. As noted before, going bankrupt, in Shiny-land today, is not failure. It is a business strategy. Breaking companies up, loading one division with legacy liabilities, while the CEO rides off into the sunset with the unencombered part, is the thing now. Honeywell did it. J&J is doing it. Kellogg’s is doing it. 3M is doing it.

I noticed something in the grocery store lately. Kellogg’s cereal tends to be mighty expensive, but, now, I see special gondolas of Kellogg’s products in the aisle, marked down. Seems Kellogg’s wants to “paint the tape” by pumping up cereal volume just before the break-up. But I digress.

Most of the major automakers have been all about juicing ATP and GP, for several years. Not only Farley, but also the honchos at VW, have openly said they want to only build more expensive cars, and they don’t care about lost volume. That lost volume is no longer available to amortize overhead and development of technologies that are common to all size platforms.

It will be interesting to see who survives in the best condition, Ford, GM, or Toyota.

Steve…betting Ford to goes toes up


You left out ‘style”. It’s the reason Tesla didn’t design the car to look like a toaster even though that would make battery placement and a lot of other stuff easier. In a recent survey only 32% said “design”, but I’d argue that it ranks much higher; very few people want to drive an ugly car even if it hits all the other markers they say they’re looking for.

In a nascent consumer economy (India, China) you can get away with a couple of “sufficient” cars. In a rich one people are a lot more choosey.

That’s a one month statistic inflated by the introduction of a new model. The real number is close to half that for the year:

Tesla sold more cars in Norway than any other brand for a second consecutive year, clinching a 12.2 percent share of the overall market ahead of[ Volkswagen] with 11.6 percent, registration data showed.

Maybe. Maybe because it’s a new market they need to test a lot of price points, style accommodations, and other factors to see what works. It’s an interesting dichotomy, Ford focusing on a few high end segments vs GM playing the field. I’m not sure GM’s strategy is idiotic, they only need a couple of hits to make the entire program pay off, then they can refine and focus. Ford, by contrast, is likely to be stuck with only a couple of platforms which may or may not carry them through the transition.


Well, no. The reason is that batteries are still not good enough to eliminate the need for aerodynamics. At the time of its introduction, the Model 3 was the most aerodynamic mass production car ever made. The Model Y doesn’t look much different. Aerodynamics is why they look the way they do Insights into the Tesla Model 3’s aero innovations and how it can achieve 215 miles of range | Electrek

Again, not quite accurate. For the period from Jan-Apr 2023, 24% of new vehicle sales in Norway were Teslas. So Tesla made up 12% of 2022 car sales and are now at 20+% for the first half of 2023. I read that as Tesla’s market share is growing despite the bevy of new models from a bunch of competitors. Norway BEV Sales: Over 80% Of New Cars Were All-Electric In May 2023 (insideevs.com)

All they need to do is look at the Model 3, the Model Y, and the top 3 BYD vehicles in China to see what works. The hard part is building any one of those models profitably. That’s what GM should be focusing on.

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For example, the Pontiac Aztec, which by all accounts was a capable vehicle, but was straight up bug-ugly.

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And the need for (good) aerodynamics is going to continue for quite a while. Battery improvements are mostly going into longer range as we’ve seen over the last decade. And we’ll see some battery improvements go into lower cost (denser and smaller overall) where we still need good aerodynamics to have the good range.
Batteries are improving several percent a year so it is going to be a decade or two until we have enough range to not have range anxiety, and small enough batteries for small (mass market) cars and faster charging…and cheap. Then maybe we’ll have the toaster form factor for shuttling people around dense cities and to/from airports.


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Not anymore. Apple in the USA is quite mainstream, and Tesla is getting there, you don’t have the number 1 selling car as a cult, and you don’t sell millions of units as a cult. They may have been cults a few years ago, but they’ve entered the mainstream at this point.

I think I’ve explained this a few times here already. Good aerodynamics will continue forever in EVs. That’s because in an ICE car, the “penalty” (costs) for bad aerodynamics are borne solely by the customer (more gallons of gasoline). But in an EV, the “penalty” (costs) for bad aerodynamics are borne by both the manufacturer (more batteries for desired range) and the customer (more charging per mile).


I used to dabble in motorsports photography as a side business 15-20 years ago. As a result I got to know quite a few professionals in that field. One happened to be at the Pontiac reveal for the Aztec. He said when the sheet was removed and the media got its first glance at the car there was an audible gasp, and not a good gasp. That was one ugly car. The reaction was not what Pontiac was wanting!

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Globally, in Q1, 23, Android had a 71.63% market share, while iOS had a 27.71% share.

But Apple makes most of the profit in “smart phones”. Here is the breakdown for 2022:

Although Apple’s shipments, revenue, and operating profits declined year-over-year in quarter four of 2022, it still captured 18% of shipment share, 48% of the revenue of the marketplace, and 85% of the profit generated by the segment for the year.

You don’t get that sort of volume vs profit skew by being popular. You get it by being a cult, whose members are willing to pay stupid prices to be in the cult. “That” is the volume/profit skew Farley thinks he can get with Ford. (commence derisive laffing)


What probably happened is the big dog said “I like it”, and all the underlings chorused “yes, yes, you are absolutely right, it’s brilliant, it will clean up in the market”, because they knew keeping their jobs meant kissing the honcho’s backside…and that is why so many once prominent USian companies get run into the ground.



Look closer at what I wrote … “… in the USA” … I know that Android dominates outside the USA … mainly because it’s cheaper.

What is strange is that Pontiac & Toyota had a joint venture in which Pontiac could badge the Toyota Matrix as a Pontiac Vibe. It was roughly the same size as the Aztek but got much better MPG as it had a smaller engine.

I will agree the US has more than it’s share of insecure status-seekers, who will pay stupid prices to be a member of the cult. Ford is not a cult. That is why Ford bought Land Rover, Jaguar, and Volvo, in the 90s, to paste those labels on Fords, to get that cult premium profit. They lost their shirt. Now they are trying to do the same thing with the prole “Ford” brand? (continue derisive laffing)