Demolish The Old, Says China

Escalade IQ, BYD, VinFast, Lithium, Tesla, Mexico, Hyundai, Kia, AESC

Aug 15, 2023

The Big 5 This Week

1. Fighting Words. At a celebration marking production of BYD’s 5 millionth vehicle last week, a video declared that it was time for Chinese automakers time to “demolish the old” legends. China is walking the talk, with plans to ship 5 million vehicles into global markets this year. But if China pushes too hard, too fast, Western governments could shut the door on market access. Link

2. Critical Minerals - Double Crisis. The US is confronting two problems when it comes to critical minerals: First, China controls most of them, which is a danger to national security. Second, critical mineral production lags EV demand. So, EVs could remain expensive for years. Link

3. Tesla China Suppliers Invade Mexico. Tesla told its suppliers in China that if they wanted future business they better start factories outside of China. Now Chinese companies are setting up in Mexico to support the Tesla Giga 6 plant. Link

4. VinFast Starts Trading in New York. On its first day on Nasdaq, VinFast (VFS) briefly surged ahead of Ford in valuation. The company is counting on US investors to help fund its brand new North Carolina plant. Key thing to watch: Will State and Federal agencies channel funds to the Vietnamese underdog, too? Link

5. Escalade IQ. Close your eyes and imagine a giant, luxurious and powerful battery-powered machine on four humongous wheels. The battery alone weighs more than a Honda Civic. The IQ starts at $130,000 and arrives in late 2024. Link

Imagine Cadillac without the Escalade. No, don’t go there.

Future EVs, Batteries, Charging

Electrics

Hyundai/Kia Lease on Life. Cars made in Korea do not qualify for incentives to US EV car buyers. Not to worry. The Koreans have found a legal workaround. Americans can secure the $7,500 subsidy by leasing instead of buying. Hyundai/Kia are now No. 2 in EV sales behind Tesla. Link

‘Tis better to lease than to buy - the Hyundai IONIQ 5.

Batteries

Envision Inside (America). AESC started out as a Japanese battery company owned by Nissan. But China’s Envision group bought a majority share a few years ago. Now the company is setting up battery operations in South Carolina and Kentucky to supply BMW. Ford is wondering why so much political heat over its battery deal with CATL. Link

Charging

Filling Up or Charging Up – Which Is Cheaper? The Washington Post did the comparison in 50 States. You cannot imagine how many variables come into play. Or perhaps you can. Bottom line: EV charging wins out everywhere. Link

Your Mach E can’t go off-road or what? And you call yourself an SUV.

New Developments / Milestones

America’s EV Demand Sputters. EV share of total US sales in 2023 is 7% - about the same level as last year. This compares to 16% in Europe and 32% in China. Stubbornly high prices continue to be the great limiter - Americans like big rigs with long range. See, for example, the $130,000 Escalade IQ. Link

Teslas At Half Off. Price competition in China can be brutal. You can now buy some variants of the Model Y in China for half the price you would pay in America or Europe. Link

EV Leaderboard (Projected Sales in 2023)

China: 8.3M

European Union: 2.6M

USA: 1.1M

Global Total: 13.8M million

And…Your Weekly Modicum of Wisdom

"Success is not final. Failure is not fatal: It is the courage to continue that counts.” – Winston Churchill