Intel Report: The Weekly Mobility News That Matters

BY AUTOMOTIVE VENTURES | SEP 16 2024 | VIEW ONLINE ➡️

What We're Reading

🚗 Automotive

Carmakers are the cheapest sector in Europe, trading at just 5.4 times forward earnings on average. That’s nearly a record 60% discount to the broader Stoxx Europe 600. Confidence in the value of their business has been eroded so much that they now trade at about a 40% discount to their forward book value, the lower end of a 20-year range. Volkswagen is trading at lowest valuation ever. | Bloomberg ($)

Nearly a third of major passenger-car plants from Europe’s five largest automakers — BMW, Mercedes-Benz, Stellantis, Renault and VW — were underutilized last year, producing fewer than half the vehicles they have the capacity to make, according to a Bloomberg News analysis of Just Auto data. | Bloomberg ($)

Tesla has revealed its modular ‘unboxed’ EV manufacturing process that will be used in its upcoming Robotaxi in a new patent application. At Tesla’s 2023 Investor Day, the automaker unveiled a new car manufacturing system, which CEO Elon Musk claimed would be faster, more efficient, and enable the production of cheaper electric vehicles. Tesla is calling it the “Unboxed Process”: The general idea is that Tesla wants to be able to work on separate sections of the vehicle individually and only bring the car together at a new “more final” assembly. It differs from the more traditional car manufacturing model to move the entire vehicle body down a line all the way to the final assembly. This new “unboxed” process was supposed to enable the “$25,000 Tesla”, but Musk canceled the two cheaper vehicle programs meant to be on this platform and now, Tesla only plans to build the Robotaxi on this platform. | Electrek

Leases accounted for a record 32% of EV transactions in the US during the first quarter of this year, according to Cox Automotive. That’s up from 11% a year earlier and well above the auto-industry-wide rate of 19%. EV leases on average cost $88 less a month than a new electric-car loan, Experian says. | Bloomberg ($)The National Highway Traffic Safety Administration (NHTSA) is proposing new regulations for vehicle design intended to reduce the number of pedestrians killed and seriously injured in crashes on U.S. roads. The proposal announced Monday comes as the number of annual pedestrian deaths is up more than 75% since reaching its lowest point in 2009. Regulators say their proposal would establish new test procedures that simulate a head-to-hood impact, along with performance requirements to minimize the risk of head injury. The agency estimates that could save 67 lives each year. | NPR

When the first motorized carriages emerged before 1900, operators had to physically sync the speed of the engine to the appropriate gear of the axle turning the wheels. General Motors introduced fully automatic transmissions in the US. By the 1940s and ’50s, everyone else started using them to make driving easier. Today, only 2% of new vehicles sold in the US have manual transmissions, per data from CarMax. Most manufacturers, even famous sports car brands such as Ferrari and Lamborghini, don’t make them at all anymore. | Bloomberg ($)

Faraday Future is doling out big raises and bonuses to its CEO and its founder, despite having delivered just 13 cars in its 10-year history and recently laying off or furloughing the majority of its workforce. This all comes at a time when the company has been scrounging for money. It finished the second quarter of 2022 with just $793,000 of unrestricted cash. | TechCrunchElon Musk’s AI startup xAI has discussed a deal where it would get some Tesla revenue in exchange for providing the carmaker access to its technology and resources, the latest example of the growing interconnectedness of Musk’s companies. Under a proposed arrangement as described to investors, Tesla would license xAI’s artificial-intelligence models to help power its driver-assistance software, called Full Self-Driving, and share some of that revenue with the startup. | The Wall Street Journal ($)

Elon Musk has denied a report that one of his companies, Tesla, has discussed sharing revenue with another of his companies, xAI, so that it can use the startup’s AI models. Writing on his social media platform X (formerly Twitter), Musk said he hadn’t read the WSJ story, but he described a post summarizing the report as “not accurate.” | Tech Crunch

Volvo Cars is quitting the car subscription business. The automaker aims to transfer its Care by Volvo programs in Germany, the Netherlands, Sweden and Norway to new owners while phasing it out in the U.K and the U.S. | Automotive News ($)Stripping rear-view mirrors from heavy-duty trucks, buses and coaches can reduce collisions with other road users by 40%. | Wards Auto

⚡️ Electric Vehicles (EVs)

New electric vehicle registrations surged 18% in July compared with the same month last year on the strength of newer models such as the Tesla Cybertruck and Honda Prologue, according to the most recent U.S. data from S&P Global Mobility. The positive trend was driven by sky-high incentives on popular battery-electric crossovers. | Automotive News ($)

BloombergNEF’s most recent EV forecast, issued in June, which projects that all-electric vehicles and plug-in hybrids will be 12% of new sales in the U.S. market this year, followed by 16% in 2025, 22% in 2026 and 29% in 2027. Growth would accelerate around 2026 for many reasons, including an increase in EVs priced to appeal to the middle of the market and because of the continuing buildout of charging infrastructure. | Inside Climate News

Ford said it's the first automaker to participate in Southern California Edison (SCE)'s Emergency Load Reduction Program, which pays customers $1 per kilowatt-hour in reduced usage during peak demand periods. The utility's lowest rate under the Time-of-Use prime plan that it recommends for EVs is 23 cents per kilowatt-hour, according to its website. A Southern California Edison spokesperson told Utility Dive that Ford EV owners eventually could return power to the grid, but for now the program is being used to manage when people charge. | Automotive News ($)

RMI reports on six solutions that can help eliminate the need for newly mined battery minerals by 2050. | RMI

Scientists working at the Oak Ridge National Laboratory (ORNL) have developed a new kind of solid-state battery technology that could double the energy density in electric cars. The distance electric vehicles (EVs) can travel between charges — known as their range — has been on a steady upward curve for the past decade, tripling from 80 miles in 2010 to 220 miles in 2021. But limits apply on how efficient they can become due to both the chemistry of liquid electrolyte lithium-ion (Li-ion) batteries that currently power EVs and their weight. The new technology, if developed, could double energy storage from the current maximum energy density in EV batteries to 500 watt-hours per kilogram, the scientists said in a statement. | ACS Publications

As we transition from fossil fuels to renewables and electric cleantech, our energy system is set to nearly double in primary-to-useful energy efficiency. This is driven by the fundamental physics of heat and work. Energy supply comes as either heat (from burning fuels like coal and gas) or work (from moving electrons with hydro, solar, and wind). As renewables replace fossil fuels, we’ll see a massive, once-in-a-century leap in energy productivity — similar to the post-World War II boom when oil and gas took over from coal and biomass. | RMIZūm, the leader in modern student transportation, has deployed an all-electric fleet of school buses in Oakland Unified School District (OUSD), making it the first major school district in the U.S. to transition to a 100% electrified school bus system. This first-in-the-nation EV fleet is also equipped with groundbreaking vehicle-to-grid (V2G) technology, enabling the buses to return energy to the grid at scale when not in use. Zūm is deploying a fleet of 74 electric school buses in Oakland, each with its own bidirectional charger, managed via an AI-enabled Virtual Power Plant (VPP). The all-EV fleet will decarbonize student transportation while sending 2.1 gigawatt hours of energy back to the grid annually. | PR Newswire

A Tesla Semi crash in California last month required firefighters to dump 50,000 gallons of water on the burning wreckage of the electric tractor-trailer in order to extinguish the fire, the National Transportation Safety Board announced on Thursday — and authorities were even forced to call in air support to waterbomb the vicinity to keep the fire from spreading. The NTSB's preliminary report states that the California Department of Forestry and Fire Protection (CAL FIRE) used an aircraft to drop flame retardant on the "immediate area" of the burning electric truck, in order to prevent the fire from spreading to the nearby forest. The California Highway Patrol said the inferno's temperatures climbed as high as 1,000º Fahrenheit, according to The Associated Press. | Road & Track

🇨🇳 China

The Biden administration on Friday locked in steep tariff hikes on Chinese imports, including a 100% duty on electric vehicles, to strengthen protections for strategic domestic industries from China's state-driven excess production capacity. The U.S. Trade Representatives said that many of the tariffs, including a 100% duty on Chinese EVs, 50% on solar cells and 25% on steel, aluminum, EV batteries and key minerals, would go into effect on Sept. 27. | Reuters ($)Even after the Biden administration's huge tariff increase on imported Chinese electric vehicles takes effect, some models will remain cheaper than competing American cars. Chinese automaker BYD's lowest-priced model in the U.S. would still be the cheapest in the market even with a 100% tariff. | NIKKEI Asia ($)China’s BYD now has the world’s largest R&D workforce of any automaker after its latest hiring spree. With over 900,000 employees, BYD aims to continue climbing the global sales charts as it advances new tech to promote longer-range, more affordable EVs. At the end of last year, BYD had just over 700,000 employees, meaning it added nearly 200,000 positions in 2024. BYD is one of the largest employers in China and is the largest employer of the over 5,300 companies listed on China’s mainland stock exchange. BYD is also the world’s largest automaker in terms of R&D staff, with over 110,000 employees. | Electrek

China is a battery powerhouse. The $115 billion Contemporary Amperex Technology Co., Limited (CATL) and its smaller compatriots accounted for two-thirds of the global market for power cells used in electric cars in the first half of 2024. Much of that output is exported: the total volume of lithium battery units leaving China roughly doubled between 2015 and 2023. The U.S. and Europe have become major buyers of Chinese cells, squeezing local operators like Sweden’s Northvolt. | Reuters ($)

Jim Farley had just returned from China. What the Ford chief executive found during the May visit made him anxious: The local automakers were pulling away in the electric vehicle race. In an early-morning call with fellow board member John Thornton, an exasperated Farley unloaded. The Chinese carmakers are moving at light speed, he told Thornton, a former Goldman Sachs executive who spent years as a senior banker in China. They are using artificial intelligence and other tech in cars that is unlike anything available in the U.S. These Chinese EV makers are using a low-cost supply base to undercut the competition on price, offering slick digital features and aggressively expanding to overseas markets. “John, this is an existential threat,” Farley said. | The Wall Street Journal ($)

🤖 Robotics & Autonomy

A Pennsylvania woman who allegedly killed two people while using Ford Motor Company’s hands-free BlueCruise system was charged with DUI homicide. Now her defense lawyers are ready to argue that, when activated, the self-driving tech is responsible for all the vehicle’s maneuvers, including the crash. | The DriveSelf-driving company Mobileye is ending development of lidar sensors and will instead focus its R&D resources on computer vision perception. Mobileye’s strategic change-up appears to validate Tesla and others that have spurned lidar in favor of a camera-based approach to autonomous driving. | Seeking AlphaAs Chinese tech companies look to dominate the future of autonomous driving, one problem they don’t have to deal with is a skeptical public. “In a survey last year by PwC, 85% of Chinese consumers said they were comfortable with autonomous driving that doesn't require human action or supervision compared with 39% of American consumers.” | The Wall Street Journal ($)

By the end of 2024, Elon Musk expects more than 1,000 of its Optimus robots will be working at Tesla. Two robots are already on the factory floor, although Tesla has not said what duties they perform. Deutsche Bank expects Tesla could save as much as $509 million annually. | QuartzThe Cavalier Autonomous Racing team from the University of Virginia won the Indy Autonomous Challenge at the Indianapolis Motor Speedway, averaging over 171 miles per hour around the iconic racing oval. | Forbes

Automotive supplier Denso announced a new manufacturing concept for workerless factories that will be "ultradigitalized" for "hyperefficiency." The factory will "be capable of 24-hour unmanned operation," Denso said, not only for production but for "the entire process, including unloading of materials and components, transfer within the plant, replenishment and feeding of materials, and packing of products." | Automotive News ($)

Tesla has weakened its real unsupervised self-driving promises on new cars in the online configurator. Tesla’s self-driving promises are well-documented. CEO Elon Musk is quoted promising “level 5” self-driving on all cars produced since 2016. He even said that a software update would come to enable all Tesla vehicles to be part of a “robotaxi fleet” by the end of every year for the last 5 years. The CEO went as far as claiming that this would make Tesla vehicles “appreciating assets” as the automaker would increase the price of the Full Self-Driving (FSD) software package as it gets better – leading to a true self-driving system that would start generating revenue from the robotaxi service. Not only has Tesla yet to reach robotaxi-level self-driving, but the first part of that statement also wasn’t true as Tesla ended up slashing the price of the FSD package from $15,000 to $12,000 and more recently to now $8,000, which helped crash the value of used Tesla vehicles. | Electrek

The Port of San Diego has received a pair of 400 tonne (440 ton) electric Konecranes. The port now boasts the highest lifting capacity of any crane system on the West Coast with a dramatic upgrade from the 100 tonne lifting capacity of the diesel cranes they replace. | Electrek

📡 Connectivity

Since launching their CARIAD software division four years ago, Volkswagen has poured almost €12bn into building in-house car software to retain control over everything from parking assistance and navigation to battery management systems and cars’ interaction with other devices and apps. Now, VW’s $5bn investment into Rivian has sparked dismay among staff at Cariad, with top executives sidelined in the sudden change of strategy. | Financial Times ($)The secret to avoiding red lights during rush hour in Utah’s largest city might be as simple as following a bus. Transportation officials have spent the past few years refining a system in which radio transmitters inside commuter buses talk directly to the traffic signals in the Salt Lake City area, requesting a few extra seconds of green when they approach. Congestion on these so-called smart streets is already noticeably smoother, but it’s just a small preview of the high-tech upgrades that could be coming soon to roads across Utah and ultimately across the U.S. | Associated PressChina’s economic planning agency is setting up a nationwide test of vehicle-to-grid charging to see if the country’s massive fleet of electric cars can be used to smooth out peaks and troughs in electricity supply and demand. Under the trial, all provinces will be asked to nominate one city to set up a V2G system — where EVs can feed power back into the grid during times of high demand. The goal is to expand the scale of V2G projects and explore commercial models that can be replicated, according to a document published by the National Development and Reform Commission. The selected sites should fully implement peak-and-trough power pricing, with the aim to concentrate at least 60% of EV charging during off-peak times, the commission said. At least 80% of EV charging done through private chargers should be outside of peak hours. | Automotive News ($)

⚓️ Marine

Commercial shipbuilding in the U.S. is virtually nonexistent: in 2022, the U.S. had just five large oceangoing commercial ships on order, compared to China’s 1,794 and South Korea’s 734. The U.S. Navy estimates that China’s shipbuilding capacity is 232 times our own. It costs twice as much to four times as much to build a ship in the U.S. as it does elsewhere. | Construction Physics

🛴 Micromobility

E-bike sales skyrocketed from 250,000 to over a million between 2018 and 2022, driving a sharp rise in injuries. A 2024 JAMA study shows e-bike injuries doubled annually, while e-scooter injuries grew 45% yearly. ER visits spiked, with 3 million incidents over six years, highlighting the risks of micromobility's rapid growth. | HarvardAn "Idaho Stop" — otherwise known as a stop-as-yield law — states that folks riding bicycles can treat a stop sign as a yield sign. Further, some states allow people riding bikes to treat a red traffic light as a stop sign, while some states mandate that drivers give people biking the right of way in intersections. The “Idaho Stop” nickname came from a rolling stop law passed in 1982 in, you guessed it, Idaho. The law allows bicyclists to approach stop signs as yield signs so that the rider does not have to come to a complete stop when the road is free from cross-traffic. | VELO

🚂 Rail

One of Japan’s largest railway companies wants fully self-driving bullet trains speeding through the country by the mid-2030’s. According to East Japan Railway Company (JR East), at least one prototype will debut in 2028. Japan’s iconic Shinkansen railines, more commonly known as bullet trains, have been a staple of the nation’s high-speed public transportation routes for over half a century. Traveling as fast as 300 km per hour (roughly 186 mph), the trains weave throughout the country’s major urban areas, and are now completely electric as well as more lightweight than earlier models. | Popular ScienceHyperloop, a new form of mass transit involving capsules whizzing on magnetic fields through depressurized tubes, has achieved significant liftoff in the northern Netherlands, Hardt Hyperloop. A test vehicle was levitated and zipped through a tube at a testing facility for the high-speed transit system once promoted by Elon Musk. The European Hyperloop Center’s 420-meter (460-yard) tube is made up of 34 separate sections mostly 2½ meters (more than eight feet) in diameter. A vacuum pump sucks out the air to reduce the internal pressure. That reduces drag and allows capsules to travel at high speeds. Hyperloop developers aim to have capsules speeding through tubes at up to 700 kph (435 mph). Its backers say it’s far more efficient than short-haul flights, high-speed rail and freight trucks, but it will involve significant investment in infrastructure. | Fast CompanyFreight trains are getting longer—some of them 3 miles or more. Railroaders call them monster trains. Union Pacific Railroad and its rivals are making trains longer because they generate higher profits, allowing the companies to haul goods with fewer locomotives and fewer crew. Long trains are typically slower, so drivers must wait longer for them to pass. When these trains stop moving, things get worse. School buses, ambulances and firetrucks are delayed. Pedestrians and cyclists clamber under or between train cars to get across—and the results can be deadly. In July, a 27-year-old woman died in north-central Texas after she climbed between railcars and the train began moving. | The Wall Street Journal ($)

✈️ Aviation & Space

Tanks were once the king of the battlefield. But the proliferation of drones in Ukraine means the large, noisy vehicles can be spotted and targeted within minutes. That has seen dozens of cutting-edge Western tanks used only sparingly in the battle they were meant to shape, while others have been damaged, destroyed or captured. In response, armies are adding technology to tanks to spot and protect against drones while also exploring design changes to make the heavy, armored vehicles more maneuverable. Battlefield tactics are already changing and lessons from Ukraine are being integrated into training. | The Wall Street Journal ($)

📚 Startups

Fred Wilson from Union Square Ventures discusses startup mortality rates at USV and across other early-stage venture funds:

1/3 are good investments
1/3 turn into something but you wish you hadn't made the investment
1/3 are zeros.

| AVC

🚘 Car of the Week

Our Automotive Ventures "Cars of the Week": a 1970 Aston Martin DBS V8 Sports Saloon. | Bonhams CarsHave a great week,Steve Greenfield

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Notable & New

🎤

Warranty work on EVs is expected to increase. This should prompt new strategies for dealership service departments, said Jim Roche, CEO of warranty processing platform WarrCloud. Automotive Ventures is proud to be an investor in WarrCloud. | Automotive News ($)

🎤

I'm excited to be back on stage with Scott Case from Recurrent debating EV penetration by 2030. Thank you to Joe Overby for being our moderator for this event. | Used Car Week

🎤

On this week's "Future of Automotive" segment on CBT News: we explore how hybrid drivetrains seem to be really resonating with U.S. consumers, and satisfying a nice gap between internal combustion and full battery electric vehicle technologies. | CBT News ($)

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