GM to be all EV by 2035?

[ZBB]

Originally Posted by clyde

My new boss is big on the idea, too, and wants us to replace our fleet of 650,000 on-road vehicles with all EVs to the tune of about $20 billion. We normally buy about 35,000 a year and we tend towards cheapo, but heavy duty versions.

If you and your similarly sized business brothers and sisters and we all say, "we want to buy a lot of these," it probably won't take much regulation to force their availability.

Part of my job is managing our fleet. If COVID wasn't restricting travel, I'd be making visits to Rivian and Lordstown to better understand their pipeline. We buy about 6k vehicles a year globally, and about 3k in the US. The US vehicles also swing towards lower priced vehicles -- Malibus, Equinox, commercial-spec Silverados/F-150s and a few HD 4WD pickups. Outside the US, we tend to have more consumer-grade vehicles ranging from Golf to 3-series and 5-series.

It will be interesting to see what the US does on tax incentives. We're seeing a new round of incentives in Europe, and its really driving behavior. One example is the UK introduced a significant reduction in their company car benefit in kind tax -- 50% reduction for a plug-in hybrid and 100% reduction for a pure BEV. Over 80% of our UK car orders have now flipped to pure BEV (including a bunch of Model 3s -- people that used to qualify for an A4 or 3-series are now going Tesla...).

The problem in the US right now is the product just isn't available yet in the price range we need. Swapping out a Malibu for a Camry hybrid increases the cap cost by $5k, and the residual is only a few hundred dollars higher -- so the lease cost goes up. Moving an Equinox to something like a Hyundai Kona EV has even worse math.

[clyde]

Originally Posted by JST

But you’ve been slagging Tesla in particular for the decision to build a proprietary charging network for years.

Please. Not JUST their charging network. There are a number of other evil behaviors I've taken them to task for. We've all been through all of them on this board more than enough times to make it necessary to do it again.

Fundamentally, i think our disagreement on this point boils down the level of importance we place of something specific within a larger system of interconnected other somethings that all need to be in place and working seamlessly for a generally-agreed-to-but-not-fully-defined future state. Some of those somethings may be more equal than others, but without them all, that future won't happen.

Is that something you would agree to?

Even if we had a fully defined and agreed to vision of that future state, we could well have some differences on strategies, actions, and timelines to get there. Some probably small, some maybe major, but we'd be paddling towards the same destination. But since we don't have that defined vision, each of our visions are probably a little different and that probably widens the divisions in how we think we get there because we're trying to get to the exact same place.

Imagine we're both driving to The Mall of America from each of our houses. We're both going to get there the exact same way. Now imagine we're starting from 12733-12799 Co Rd 5, Burnsville, MN 55337 and we're each going to a department store at the mall. Except we're not going to the same department store. You're heading to Nordstroms, I'm headed to the Macy's next door. The Google Maps selected route for each trip is completely different despite the same starting location and the destinations barely being able to be closer to each other without also being the exact same.

I don't pretend that analogy is flawless, but it does a good job of illustrating the concept.

Beyond that, I don't see much point in re-arguing about the specific point here. I'd be happy to do it in person with beer and a 1:1 comparison of orange to red paint. We could even do one of those video blog debate things to share it with everyone else, but I honestly don't care to type it all out again. Without new information, I won't change your mind. You won't change mine. I'm not sure either of really wants to change the other's mind even if we could.

I was content to just make the comment and continue moving along...

[clyde]

Originally Posted by ZBB

Part of my job is managing our fleet. If COVID wasn't restricting travel, I'd be making visits to Rivian and Lordstown to better understand their pipeline. We buy about 6k vehicles a year globally, and about 3k in the US. The US vehicles also swing towards lower priced vehicles -- Malibus, Equinox, commercial-spec Silverados/F-150s and a few HD 4WD pickups. Outside the US, we tend to have more consumer-grade vehicles ranging from Golf to 3-series and 5-series.

It will be interesting to see what the US does on tax incentives. We're seeing a new round of incentives in Europe, and its really driving behavior. One example is the UK introduced a significant reduction in their company car benefit in kind tax -- 50% reduction for a plug-in hybrid and 100% reduction for a pure BEV. Over 80% of our UK car orders have now flipped to pure BEV (including a bunch of Model 3s -- people that used to qualify for an A4 or 3-series are now going Tesla...).

The problem in the US right now is the product just isn't available yet in the price range we need. Swapping out a Malibu for a Camry hybrid increases the cap cost by $5k, and the residual is only a few hundred dollars higher -- so the lease cost goes up. Moving an Equinox to something like a Hyundai Kona EV has even worse math.

Do operating costs factor into the acquisition decision? Or are they borne by other divisions? Or are the operational savings not great enough to change the outcome?

I wonder how much this has all been gamed out. Industry is moving in the direction(s) they are moving for all their own reasons. Governments around the world (national down to local) are moving in fits and starts towards an electric future, but not all the parts are moving in coordinated ways and many of them are behaving based on very short term single issue visions with the bonus of blinders on as well.

Moving this piece move that one if you didn't mean to. And that one moves four other pieces that, in turn, move a bunch of others. If history is a guide, it's going to be rough and take a while before we get to an imperfect, but relatively stable future.

[ZBB]

Originally Posted by JST

IDK, man, I really don’t understand your point. In the cellphone power context, what is the analog with the high speed charger network? And also I am confused because I thought JV originally brought this analogy up to say it was hypocritical to be pissed at Tesla and ok with Apple.

There is a somewhat complex analogy you could draw between the buildout of incompatible 3G networks, the transition to 4G, and the role of subsidized locked handsets, but that has such different market and technology dynamics that I don’t think it’s particularly helpful. Among many other things, while phones are expensive, they pale in comparison to the cost of service; no one is trying to build an EV network and give away cheap cars as an incentive to subscribe to it.

Ultimately I agree with you that multiple standards are probably untenable. There will be convergence at some point. Either Tesla and other OEMs will get serious about long-rumored agreements to share the Tesla network, or Tesla will make CCS adapters and switch over to CCS here, too — or some combination.

But you’ve been slagging Tesla in particular for the decision to build a proprietary charging network for years. I just think you’re wrong about that; the proprietary network made sense for Tesla, made sense for Tesla’s customers, and was one of the key drivers to allowing Tesla to sell half a million cars last year.

And without that success, there’s NFW GM would be seriously talking about transitioning to full EV by 2035.

In fact, I’m going to say that when the story of the EV transition is written, the Supercharger network will be one of the main inflection points (along with Dieselgate, maybe, but only because Dieselgate gave VW an economic incentive it did not otherwise have to invest in a charging network).

I like your cellphone network analogy, and I'd argue we're in the 3G phase right now. Here's how I see the of history cell phone vs charging networks:

Cell phone 1G was the analogue cell services that started in the 80s and were avail until the mid 90s. The parallel for EV charging is the inductive paddle charging used by the GM EV1 and a couple other early EVs for roughly a decade between ~1995-2005. GM's inductive paddle became the J1773 standard, but those have been phased out -- just like analogue cell services.

The cell phone 2G standard is somewhat equivalent to the AC charging methods used today today. 2G cell service included GSM in Europe (and most of the world) and "PCS" service in the US. In the US, different carriers used different underlying technology (remember TDMA vs CDMA discussions?) -- so if you had a phone with Verizon, you couldn't move your service to AT&T without also having to get a new phone. Interestingly, for charging, AC uses the same basic standard around the world, but there are multiple competing plug shapes -- but the parallel exists in that Europe standardized and required a single plug, the US only recommended a standard, but automakers were not required to follow it. In the mid '00s, the US converged on the SAE J1772 standard, which was also adopted internationally as IEC 62196 -- but the US plug shape is different than the EU plug shape (but they use the same communications protocol). Tesla used J1772 on the Roadster, but then used their own smaller plug shape for the Model S, although for AC charging, it follows the J1772 standard (Tesla provides an adapter that lets you plug any J1772 charger into a Tesla, and you can now buy adapters that let you take a Tesla cable and plug it into a J1772 receptacle on another car for AC charging only (so this is a different than 2G cell service). The other parallel with 2G cell service to AC charging is that the speeds are relatively slow -- slow data on the phone, and slow charging for a car. L2 AC charging mostly caps out around 240V 50A delivery, which adds 44 miles per hour on a Model 3 or Y for example, and most other EV's can only charge up to about 240V 30A (7kW)...

For 3G cell service, we started seeing the underlying technologies around the world converge, although there are still some differences at the frequency level (not all countries or all phones supported the same frequencies -- for example, early Verizon 3G phones typically didn't roam outside the US very well -- they were OK in places like Mexico, but not in Europe), while AT&T's phones pretty much roamed anywhere. The equivalent for EV charging is L3 DC "fast charge" standards -- where there were initially 2 standards (Japan's CHAdeMO and the an evolution of SAE J1772 and IEC 62196-1 that added DC standards), but then China came in with their own standard. To complicate things, all 3 standards have different-shaped plugs (and the SAE/IEC have different shapes), and Tesla stuck with their smaller shape -- so there are 5 different shapes of plugs avail around the world (with 3 of them including Tesla using the same underlying communication standard).

4G cell service (ie LTE) is where things really started to converge (although there were still some frequency differences between countries, but most phones were able to use all or nearly all frequencies). If we are going to see a convergence in charging, it will happen in this phase. Although I think we may be stuck with different connector shapes in different regions of the world. As Josh mentioned, Tesla has already adopted the EU style plug in Europe.

Here's some pictures of the various plugs:

Pic 1 has AC charging -- from left to right are J1772 (also called "IEC Type 1"), Tesla and IEC Type 2 (sometimes referred to as Menekes).


Pic 2 has some of the DC chargers -- from left to right are CHAdeMO, the IEC CCS "Combo 2", with the IEC Type 2 AC charger shown for size comparison. Not show in the J1772 version of CCS (ie "Combo 1"), but it is similar to the Combo 2, just with the J1772 plugs on the top half and the same DC plugs on the bottom. All 3 of these are significantly larger than Tesla's wand (which basically uses DC-rated plugs for AC charging instead of separate sets of pins, like the CCS versions.


I personally was hoping other manufacturers would jump onto Tesla's design and help build out the Supercharger network. Tesla's design is elegant, lightweight, and easy to use. All of the other DC connectors are massive, heavy and cumbersome to use.

[ZBB]

Originally Posted by clyde

Do operating costs factor into the acquisition decision? Or are they borne by other divisions? Or are the operational savings not great enough to change the outcome?

I wonder how much this has all been gamed out. Industry is moving in the direction(s) they are moving for all their own reasons. Governments around the world (national down to local) are moving in fits and starts towards an electric future, but not all the parts are moving in coordinated ways and many of them are behaving based on very short term single issue visions with the bonus of blinders on as well.

Moving this piece move that one if you didn't mean to. And that one moves four other pieces that, in turn, move a bunch of others. If history is a guide, it's going to be rough and take a while before we get to an imperfect, but relatively stable future.

Yes -- op cost weigh in. The metric used in the industry is "TCO" -- total cost to operate, measured either monthly or annually. Includes the lease cost, fuel cost (if paid by the company -- not all cars have company-paid fuel), maintenance, repair cost, tools, taxes/registration costs, and any gain/loss on sale at the end of lease (commercial leases in the US are open-ended leases, so there can be a gain or loss at the end of lease). All costs are paid by the individual business unit. TCO is looked at by vehicle.

Interestingly, in Europe, where cars are often part of a the pay package, the TCO for an EV vs ICE in the same class range are pretty competitive. We're not there yet in the US -- at best EVs are a 15% premium compared to the types of cars we buy.

Using TCO as a metric for my personal cars also makes sense. I went pulled some data for the cars I've had going back to my E46. The numbers below includes everything I spent on the cars, except for insurance and any parking fees (which are mostly random). Includes fuel or public charging, maintenance, repairs, depreciation, interest on loans, any accessories, car washes, occasional tolls, etc... For the Teslas I added $30/month for home charging costs (that's what my first year incremental electric bills averaged as an increase...). Nothing is adjusted for inflation...

2001 325Ci: TCS was about $517 per month (I had it from '01 to '05)
2003 535i: TCS was about $764 per month (I had it from 2005-2008)
2008 CTS: TCS was about $847 per month (I had it from 2008-2010)
2008 Boxster: TCO was about $840 per month (I owned it from 2010-2013)
2013 Model S: TCO was about $990 per month (I owned it from 2013-2018)
2018 Model 3: TCO so far is $632 per month (and still own it -- I'm assuming trade-in value for depreciation purposes)

The Boxster and 535 were bought CPO and were each about 2 years old when I got them. All the others were bought new.

The Model S was the most expensive car -- which is reflected in the TCO. But its not significantly higher than either the CTS or Boxster, which cost about 1/3 less...

Interestingly, if I adjust the '01 325Ci's TCO for inflation (assuming 2003 -- the midpoint of owning the E46) to 2020, that TCO would increase to ~$727 today So the Model 3 is nearly $100 less expensive per month...

[FC]

Originally Posted by ZBB

Tesla's design is elegant, lightweight, and easy to use. All of the other DC connectors are massive, heavy and cumbersome to use.

I will agree with that.

[John V]

Originally Posted by ZBB

Yes -- op cost weigh in. The metric used in the industry is "TCO" -- total cost to operate, measured either monthly or annually. Includes the lease cost, fuel cost (if paid by the company -- not all cars have company-paid fuel), maintenance, repair cost, tools, taxes/registration costs, and any gain/loss on sale at the end of lease (commercial leases in the US are open-ended leases, so there can be a gain or loss at the end of lease). All costs are paid by the individual business unit. TCO is looked at by vehicle.

I've run through the math on our Boxster and am way below you on TCO (as in around $340 a month). I'm trying to figure out what I'm missing. I think I'm assuming a pretty large dollar figure for depreciation as well.

[clyde]

Originally Posted by ZBB

Yes -- op cost weigh in. The metric used in the industry is "TCO" -- total cost to operate, measured either monthly or annually. Includes the lease cost, fuel cost (if paid by the company -- not all cars have company-paid fuel), maintenance, repair cost, tools, taxes/registration costs, and any gain/loss on sale at the end of lease (commercial leases in the US are open-ended leases, so there can be a gain or loss at the end of lease). All costs are paid by the individual business unit. TCO is looked at by vehicle.

Interestingly, in Europe, where cars are often part of a the pay package, the TCO for an EV vs ICE in the same class range are pretty competitive. We're not there yet in the US -- at best EVs are a 15% premium compared to the types of cars we buy.

Using TCO as a metric for my personal cars also makes sense. I went pulled some data for the cars I've had going back to my E46. The numbers below includes everything I spent on the cars, except for insurance and any parking fees (which are mostly random). Includes fuel or public charging, maintenance, repairs, depreciation, interest on loans, any accessories, car washes, occasional tolls, etc... For the Teslas I added $30/month for home charging costs (that's what my first year incremental electric bills averaged as an increase...). Nothing is adjusted for inflation...

2001 325Ci: TCS was about $517 per month (I had it from '01 to '05)
2003 535i: TCS was about $764 per month (I had it from 2005-2008)
2008 CTS: TCS was about $847 per month (I had it from 2008-2010)
2008 Boxster: TCO was about $840 per month (I owned it from 2010-2013)
2013 Model S: TCO was about $990 per month (I owned it from 2013-2018)
2018 Model 3: TCO so far is $632 per month (and still own it -- I'm assuming trade-in value for depreciation purposes)

The Boxster and 535 were bought CPO and were each about 2 years old when I got them. All the others were bought new.

The Model S was the most expensive car -- which is reflected in the TCO. But its not significantly higher than either the CTS or Boxster, which cost about 1/3 less...

Interestingly, if I adjust the '01 325Ci's TCO for inflation (assuming 2003 -- the midpoint of owning the E46) to 2020, that TCO would increase to ~$727 today So the Model 3 is nearly $100 less expensive per month...

Some interesting stuff in there. Thanks!

Originally Posted by John V

I've run through the math on our Boxster and am way below you on TCO (as in around $340 a month). I'm trying to figure out what I'm missing. I think I'm assuming a pretty large dollar figure for depreciation as well.

Boxster market was more normal used car like during ZBB's ownership than today which is probably propping up the value of you car. Knowing the miles driven during ownership might explain some of it, but unless one of the cars went to super high mileage, probably not responsible for much of the difference.

FWIW, the TCO for the 2017 Camaro was amazingly good. The TCO for the 2020 Camaro so far is amazingly bad.

[ZBB]

Originally Posted by John V

I've run through the math on our Boxster and am way below you on TCO (as in around $340 a month). I'm trying to figure out what I'm missing. I think I'm assuming a pretty large dollar figure for depreciation as well.

I went back and looked at it. Depreciation alone was just under $500/month and I spent about $200/month in gas back then (it was my daily driver -- and my commute was about 1k miles per month). I also had a dumb accident with it (I backed into a tree), as well as had a couple of parts purchases and regular maintenance which I did at the Porsche dealer (oil changes were over $200). I also had to buy 3 rear tires (2 regular replacement and I ran over a paint scraper on the freeway one day on the way to work, hence the 3rd...); the fronts were just about due for replacement when I sold it... So the number is in the ballpark...

Originally Posted by clyde

Boxster market was more normal used car like during ZBB's ownership than today which is probably propping up the value of you car. Knowing the miles driven during ownership might explain some of it, but unless one of the cars went to super high mileage, probably not responsible for much of the difference.

That's definitely a part of it -- I owned it during the opposite of the current market (bought when used prices were high due to the financial crisis, sold in more "normal" times). I bought it in Sept 2010, and probably paid a bit of a premium (CPO, very low miles -- ~4500), and used prices were still holding up at the time from the financial crisis. I sold it just before getting the Tesla and ended up Carmaxing it since Carmax's offer was the same as the most recent highest price for a Boxster S on eBay (which I was using to gauge if I should private party it...).

It also looks like I may have sold it close to the bottom of the depreciation curve for a 987.1 S -- a quick look now shows I could buy a similar milage for about what I sold mine at. Oh well...

Originally Posted by clyde

FWIW, the TCO for the 2017 Camaro was amazingly good. The TCO for the 2020 Camaro so far is amazingly bad.

[John V]

Because I was curious I did the math on what the car has cost me.

I paid $41k for my car seven and a half years ago, and the assumption I made is that it's worth $29k now, with around 83,000 miles on it.
Depreciation: $12k
Fuel: $8,060
Maint/repairs: $1145
Insurance: $2800
Taxes, registration, title fees: $3406
Total: $27,411
Years owned: 7.5
$27,411/7/12 =~ $346/yr. Not bad! Doing all my own work helps for sure, as did getting a set of free tires