The ICE auto industry is being seriously disrupted.
NIssan’s profits in the most recent quarter declined a whopping 99% year to year. Market expectations were for about a billion dollars operating profit. It turned out to be $6.5M. Nissan's Q1 profit plunges 99% as US discounts shred margins
Honda is shutting down two factories making gas cars in China. They are planning to replace them with two new EV factories. It is interesting that Honda isn’t trying to reconfigure the existing factories to make EVs. It suggests that electric vehicle production is sufficiently different from ICEs that it is more cost effective to start from scratch. GAC Honda to Shut Down Production Line, Open New NEV Line in China
Unlike its rivals Toyota and Honda, Nissan doesn’t offer hybrid models in the US, missing out on the rising demand for hybrids as enthusiasm for EVs cools.
I’d guess that it has a lot more to do with their costs increasing, but the prices they can charge for their products not increasing. It’s very likely, due to the recent bout of inflation, that many of their input costs have gone up. All sorts of parts are costing them more, shipping is costing them more, distribution is costing them more, and labor is costing them more. Meanwhile, they can’t get premium prices for their products because they just aren’t particularly exciting, and they have some gaps in their product lines. Even their Infiniti line, that used to be quite exciting and fresh, has become stale and boring.
Back in 2021/22, a carmaker could sell pretty much anything, nice or not, exciting or not, up to date or not, at a premium because demand strongly surged above supply. Today that is not the case anymore. Some brands have their vehicles languishing for tens of days, even over a hundred in some cases, and that utterly destroys profitability (unless the manufacturer is willing to let their dealers fail and shut down). Meanwhile, even with manufacturer support, many dealers are suffering greatly from the higher floorplan costs.
The largest part of the factory is still metal stamping, welding, cleaning, priming and painting. Ev still requires seats and interiors.
ICE assembly line drops in preassembled engines, transmissions, etc. But battery and ev motor installation might need different sequence. So must rearrange assembly line. And equip for heavier lifting.
I think you are misreading the tea leaves. Nissan is dying because no one wants to buy a straight ICE anymore. People want to buy electric. They are going with hybrids now because hybrids are much cheaper and represent a reasonable compromise until battery range and the charging network improves. But BEV sales are still increasing. Not ICE sales though. Gas cars are in a death spiral.
America and Europe are scared to death about Chinese BEVs. No one cares about ICE or hybrid imports. That’s because BEVs are where the market is going.
When you say that, are you including conventional hybrids as ICE cars? Because sales of conventional hybrids - which run on nothing but gas/petrol - are skyrocketing in Europe. BEV sales are basically flat and losing marketshare, but full and mild gas-only hybrids are flourishing.
Not really what happened. First of all, there was a real shortage, it wasn’t just a narrative. Second of all, that’s how all pricing works. The price of anything is what a willing buyer will pay a willing seller. If there are 900 available, and 1000 customers for it, the only reasonable way to determine which 900 out of 1000 get the item is based on who will pay more for the item. Third of all, most of the excess profit was made by the dealers, not the manufacturers. The only additional profit the manufacturers got was due to not having to give extra good deals to the dealers. But even so, the dealers only sold to willing customers. You’ve got to be nuts to pay $10k over MSRP, just get a different car instead, or get a used one for a while, of fix your old jalopy one more time, etc!
Not an option when everyone is Rogering their customers.
Used car prices flew too.
Unless you leased, and the dealer demands the car back. I read of several cases where people tried to exercise the buyout option at the end of the lease, but the dealer refused to honor it, because they could sell the off-lease car for more than the lease buyout.
I was shopping for a car at the time, and this is not at all true. There were a few less popular brands and certain dealers that used to sell $1-2k under MSRP and sold at MSRP or maybe a bit above in 21/22. And there were a few manufacturers that always sold at MSRP and only at MSRP (I bought a car from one of those).
Oh, definitely, but nowhere near $10k over previous value!
VERY few cases of this, most lease contracts are quite clear regarding the availability of a buyout or the lack of availability of a buyout. Not to mention that the dealer doesn’t hold the lease, a finance company does. I personally know a few people that always lease their cars, and they always roll over every 3 years (they like driving new cars all the time). Last time their lease ended, they got a new lease as usual (arranged well in advance, so shortages affected them less than others), AND they took the buyout on their previous lease and sold it right away (at least once or twice to their own dealer) for a quick $3-5k profit! Back then, you could drive up to carmax/carvana/whatever and they’d hand you a check right there.
Definitely a laugh riot. That’s why your posts are so entertaining, they’re criminally dumb.
ICE cars 3 times more than EVs and hybrids combined .
Maybe. Probably not, not in my lifetime or yours. Of course there will be erosion, that’s what happens when a new competitor starts, or a new technology is introduced. It took 30 years for cable to disrupt broadcast TV, and 20 years for streaming to disrupt cable.
It was 20 from the brick phone to the iPhone. It’s been 30 years for BlockChain and we’re still waiting. Flat screen TVs came out in 1997 and took a decade to make it into homes. Smart TVs came out in 2011 and work wide penetration is still below 50%.
It’s going to be the laziest, slowest spiral you can imagine. By the middle of the century, most people will still be driving gas cars or hybrids.
It is remarkable how the mindset has changed so rapidly. A few years ago hybrids were considered the leading edge of the electrification of the auto industry. Now hybrids are being used to show the resilience of ICEs.
Goofy I do enjoy engaging with you. You are the like the old Uncle with strong opinions who hasn’t realized that time has passed him by.
Hybrids are now supplanting straight ICEs as the vehicle of choice by the masses. In about 5 years, BEVs will be doing the same to hybrids. The latter transition will occur faster because of the pressure global warming is putting on governments.
Primarily because for most of the past decade, the sticker price of BEVs was about twice that of ICEs. What China and the Scandinavian countries have shown is that if one gets to price parity, either through incentives or cutthroat competition, people will choose BEVs over ICEs. Price parity (at the $20K range without incentives) will likely happen over the next five years in the West.
The only thing keeping ICEs competitive in the US is the tariff.
If Americans love ICEs as much as you all say, why is everyone so afraid of BYD who only makes BEVs and hybrids?
Meanwhile, Toyota’s global sales for 2024 declined 5% and Samsung announce a solid state battery with 600 mile range, 9 min charge time, and 20 year life span. Samsung just needs to get the production price down, which history has shown can happen quickly with batteries. Samsung Rolls Out 600-Mile Range Solid State Battery – NC
Well, more than a few years ago - after all, it’s been nearly a decade and a half since the Leaf and Roadster production BEV’s went on sale.
But yes, hybrids do show the resilience of ICE’s. From an Econ 101 standpoint, you would expect any market-based efforts to reduce fuel consumption/carbon emissions to start with the changes that have the lowest marginal cost per unit of fuel reduction. In other words, you start with the cheapest solutions first. The cheapest ways to reduce fuel consumption are to make your ICE’s more efficient - smaller lighter cars, start-stop tech, leading into mild and pure conventional hybrids.
Here at the midpoint of 2024 it looks like consumers in Europe have reverted a bit towards just marching up the marginal cost curve - moving from traditional ICE’s mostly to conventional hybrids, and not so much EV’s. It’s early days yet, but that’s at least one data point that EV adoption might not necessarily follow an S-curve.
Hybrids are ICE vehicles (even PHEVs are ICE to a great extent). And overall, hybrids are a terrible phenomenon overall for long-term energy efficiency. In the short-term they’re great (we [humans] seem to be very good with short-term rewards/benefits). I’ll explain why. It’s because a hybrid will let’s say double gasoline efficiency, call it from 25 mi/gal to 50 mi/gal. But over the 20+ lifespan of the vehicle it will still be consuming gallons of fuel at a fixed rate of one gallon every 50 miles or so. Meanwhile, BEVs will consume the equivalent of 1 “gallon” every 100 miles, but that initial efficiency isn’t the end of the calculation. Out of that 1 “gallon” equivalent, right now perhaps 1/3 comes from cleaner sources, and 2/3 comes from dirtier (fossil fuel) sources. But in 6 years, it might be that 1/2 comes from cleaner sources. And in 12 years, it might be that 2/3 comes from cleaner sources. The BEV gets better and better with age, while the hybrid stays the same forever.
Not at all. It only looks that way in your analysis because you’re comparing them only to BEV’s.
Oh, sure - they’re not as good as BEV’s. But they’re better than ordinary ICE’s. And a new non-hybrid ICE also lasts 20 years - locking in even more future gas consumption/carbon emissions.
The key is that if hybrids are cheaper or easier to sell to consumers, more of them will be sold. So even though each individual hybrid doesn’t save as much emissions as a BEV would, if more of them get sold it can still be a better outcome for long-term efficiency than the alternative of selling lots more ordinary ICE’s.
So, yes - a hybrid Camry (50 mpg) will emit more carbon in 10 years than a BEV. But it will emit less carbon in 10 years than a conventional Camry (32 mpg). So when Toyota switches all Camrys from conventional to hybrid for the 2025 model year, those ~300,000 cars will end up saving more carbon emissions than if Toyota had sold 100K BEV’s. Which is pretty significant, since no automaker apart from Tesla has sold as much as 100K BEV’s in a single year. [Edit - the foregoing is for U.S. sales]
Sometimes it does! For example, let’s say a gas powered plant is switched with a solar plant.
Gas - has fuel costs each year of $X, maintenance of $Y.
Solar - has fuel costs each year of $0, maintenance of $Z.
If $Z minus $Y+$X divided by energy unit declines, then the solar plant is getting better efficiency (relative to the alternative) as time passes.
Nuclear is even more stark. Once the huge costs of construction have been amortized, the efficiency numbers go way up in terms of $/energy unit.
Gas generation can also improve efficiency, but generally only in very small steps and almost always has a limit close to the design constraints.
The point is that when you separate the energy generation part from the energy use part (EV), you at least have a chance of improving efficiency (externally). When they are together (ICE), you have no chance, and that device (the ICE vehicle in this case) is a long lasting item (20+ years).
