The Ford CEO is not wrong. Allowing foreign imports into the country at prices far below what US producers are able to make will decimate the local car industry in the US.
There are 4 possible solutions to this problem;
a) convince Americans that it's worth paying more for a locally built product. This is the simplest approach, but there's only so much margin here that the consumer will tolerate. At the moment this gap is too large.
b) Tariff foreign imports to raise their cost. So the US consumer pays more, whether they like it or not.
c) subsidize local production out of the "national interest to support this industry" budget. This has the effect of ramping up demand, hence production, hence production being developed, and eventually getting cheaper.
d) improve US products, and prices, so that they compete in price to the import - or at least fall inside the margins such that a) becomes effective. c) can help bridge the gap here until the US companies have caught up.
In the long run, not all these strategies win. If you go the tariff route, then it's hard to undo it later. Local products fall behind, and the harder it becomes to catch up. Not impossible, but hard.
If Ford wanted tarrifs to help boost EV demand, and so allow Ford to build out infrastructure and lower costs, then fine. But it seems it's more of a short term play to just keep ICE Fords selling in the short term.
This is one of those "the internet is a fad, it'll never catch on" moments. EV's are here to stay. They're going to win. That's pretty obvious to anyone paying attention. If the question is "how to maintain the US car production" then they should be all-in on EV development now. It seems to me though that the current strategy seems to be very short term thinking - trying to just hold back the tide.
What’s interesting is that while most cars imported into Mexico (except for those from the NAFTA region) face stiff tariffs or outright bans (if you move to Mexico from the US you can only bring your car if it was manufactured in Mexico/Canada/US, other cars are not allowed at all), but electric cars have no tariff at all which means that, e.g., Chinese EVs are widely available there. The BYD Seal sells for MXN888000 in its AWD/big battery configuration which translates to USD51,184¹ which is comparable to the Tesla Model 3 price in Mexico (and a bit lower than the equivalent price in the US). Mexico is going at the EV transition with a two-pronged strategy: Building a domestic industry and encouraging imports at the same time. This seems to be the exact opposite of the US strategy.
⸻
1. Worth noting two key differences between the Mexican and American car buying experience: First, prices are fixed. There’s none of this negotiating with the dealer about the price or upselling you on undercoating stuff. You can look on the website and know what the price is. Second, instead of sales tax, Mexico uses VAT to achieve the same purpose. As a result, the price you see for a product is going to be the actual price you pay walking out the door and not the price before sales tax (at my current residence, the total sales tax is currently 10%). As a consequence, some things that might appear to be slightly more expensive in Mexico, depending on where you live, may actually be slightly cheaper.
The US didn't go from #1 in global auto manufacturing to nearing extinction on accident. The companies shifted production abroad because they didn't want to pay for US labor. We can't just pray for "development" to spark a chain reaction that gets us back on track - we were the most developed and consciously chose to squander that advantage.
Onshoring can be done, but it will have a real cost someone will have to bear. The industry would prefer consumers just pay twice as much for cars, meanwhile consumers are at a breaking point like they've never felt. In the meantime there's a stalemate and nobody can move, as the decline continues.
Comparing with China, I’d be curious about whether their companies face the same return-on-capital forces that US (and to a lesser extent western) companies do. So when we outsource to them, it’s to a vendor who is not needing to promised 10%+ returns. As I understand it, this is because the central government exerts pressure on banks to make loans at low rates, so that capital can be raised more easily for targeted industries.
I agree that onshoring is likely impossible without some sort of contextual reimagining of US industry.
Also US cars were genuinely horrendous in the 80s-90s in terms of build quality & reliability vs same price or cheaper Japanese equivalents.
It's only rather recent that all the big name car makes from US/Europe/Japan/Korea are pretty good & reliable. There were huge differences 30-40 years ago.
I think there's a finer point here: US consumers don't want to pay for local UAW labor. GM&Toyota did fine out of the NUMMI plant, and companies like Nissan and Mercedes are making cars in Alabama.
> The companies shifted production abroad because they didn't want to pay for US labor.
That's not true. Reality is far more nuanced than that. Sadly, it is the equivalent of a bunch of Dodo birds falling off a cliff. And this applies to every industry, not just automobiles.
The simplified version goes something like this:
Three companies manufacture forks and knives in the US. They share the market equally. Each has 1/3 market share.
One of them decides they can be clever, manufacture in China, reduce the price of their products and get more than 1/3 share.
Their plan succeeds. Their market share goes up to 1/2 and the other two companies down to 1/4 each
Try as they might to compete, they cannot, the cost basis in the US is higher.
One of them decides "We can be just as clever" and they start manufacturing in China.
Now two of the companies, on account of their lower prices, have 2/5 of the market each. The third company is down to 1/5 share.
The last company has no choice at all, they have to manufacture in China or shut their doors.
With all three companies manufacturing in China, we are now back to each having 1/3 of the market again. Except that, due to the price war, they are now selling the same product they were selling before the transition for half the price. And, of course, their margins are no better, maybe even worse.
And now, the grand finale: The industrial development all three companies effectively funded in China has taught one or more factories how to make these products. Now the Chinese companies enter the market directly, compete with their customers and drop the prices even more. All three companies go out of business. One of the companies is acquired in bankruptcy by one of the Chinese factories who sell the same product for less under the same brand.
Ironically, the reason (one of them) consumers are at the breaking point is because this chain reaction --which required consumers to prefer cheaper goods from abroad-- managed to destroy untold number of industries everywhere. This destroyed jobs by the millions. And here we are.
In some ways this is no different from the race for higher minimum wage. The huge sucking sound you are hearing are the millions of jobs that are being lost because of it.
This debate is as old as Adam Smith, or older. I think the examples he used were centered around textiles? Everyone was afraid of the new job-destroying looms.
> This destroyed jobs by the millions. And here we are.
US unemployment has been about 5% for a while. If you look back on the graph: https://www.bls.gov/charts/employment-situation/civilian-une... , there are two big outliers. One is the business cycle disaster of 2008, which blew up the property market. One is COVID.
Unemployment is basically a managed number. It can't go too far below 4% before inflation kicks in, which everyone absolutely hates, so interest rates are raised to reduce investment and consumption and thereby increase unemployment and reduce wage pressure. All of this is orthodox economics.
Everyone laughed at Trump because what he did was stupid. Selective tariffs have always made sense in certain contexts and have never been controversial.
The tariff route is what happened in the 1970s under the "chicken tax", which still exists today to protect the US light truck industry, and is pretty much the reason why SUVs reign supreme in the US market. SUVs are classified as "light trucks", which has caused a Galapagozation of the US car industry/market.
I see this take on SUVs all the time, and I can't help but think it's wrong. Americans just like bigger vehicles and will downsize if gas gets too expensive. There's a reason almost all electric car companies start off with a CUV/SUV/truck, and it's not because they're allergic to sedans or coupes.
- Tesla, the most prominent and successful EV company, didn’t start with a truck.
- Neither did all the attempts at EVs from other competitors in the 2010s, like the GM Bolt/Volt or the Nissan Leaf.
- But you’re not wrong, that today EV companies usually start with SUVs/CUVs, but that’s because a larger chassis makes it easier to include a large enough battery.
Back in the 2010s, EVs were primarily sold to customers that were more likely to be averse to SUVs for the perceived environmental impact and, frankly, snobbery (liberals of the time used to mock big SUVs like the Cadillac Escalade and the Hummer, particularly after they got associated with the timespan of the Bush administration before becoming uneconomical after the late 2000s oil price spike). Also the batteries just didn't have enough capacity at a reasonable price to build anything heavier than a sedan.
As soon as it was feasible, Tesla released a CUV (the Model Y) which now outsells the Model 3 almost 2-to-1. Arguably Tesla has fumbled by letting Elon pursue the Cybertruck rather than a full-sized SUV or normal pickup truck. You can observe that Rivian went after precisely those missing models.
They're mostly CUVs and above because fitting sedan seating into a CUV-shaped body frees up the height you need for a battery. Western OEM batteries were usually tall because they mostly used large-format pouch cells, because that promised the highest performance and lowest cost (spoiler: recalls are expensive).
There is a market for smaller cars and trucks but its probably smaller than for other countries. We don't have the smaller roads/spaces associated with e.g. Europe. But for sure I would buy small cars or trucks first any day compared to the monsters on the road; there are few options though.
The SUV branding is ridiculous. The Fiat 600 brands itself as "SUV" to appeal to this sector. It's basically a hatchback with a slightly elevated driving position. In a few years all cars will be called "SUV", and then sub-distinctions like "compact SUV" and "hatchback SUV" will be re-introduced.
One route is to provide incentives, if not regulations, to force innovation on US automakers. The goal would be to yield products that are head-to-head competitive with imports.
> It seems to me though that the current strategy seems to be very short term thinking - trying to just hold back the tide.
I'm seeing that too, but from a different angle. The era of big trucks seems to be as much an effort to extract cash from the economy as it is taking advantage of a peculiar set of EPA and DOT regulations. Basically, "gettin' in while the gettin's good." It's not a long-term strategy because, at some point, people can't afford these behemoths and will go for the used car market next for cheaper goods. EVs may get caught up in that too, considering that they're aimed squarely at the sub-luxury tier and above. As we have no good cheap EV options at the moment, I think it's the same story.
The main difference between a car like this and a kei car is the ability to drive it, at least for a short while, on the expressway. If this could go a couple miles at 45 or 50 mph that would work in lot more situations where two neighborhoods or urban areas are connected by a short stretch of highway.
Kei cars can comfortably go up to about 60mph. Not great for an 8 hour drive, but I regularly do 3-hour-drives with a loaded kei-van. Yep, same 660cc three-cylinder engine that those kei-trucks have.
It'll hit 70mph, but not comfortably.
50mph is easy.
And on the highway, I see tons of other kei cars, too. Light weight class cars even get a toll discount!
> The Ford CEO is not wrong. Allowing foreign imports into the country at prices far below what US producers are able to make will decimate the local car industry in the US.
The local car industry in the US is doing that to itself by dragging its feet on EVs in the US market even when the very same companies are selling EVs outside of the US. Ford, for example, has an EV Bronco that's inexplicably only available in China; that'd sell like gangbusters here in the US, but Ford won't sell it here because reasons.
In that sense, the Ford CEO is about as dead-wrong as it gets. His company needs to either actually sell competitive products or else move out of the way for other companies to do so. His demands to keep foreign competitors out of the very US market in which his company refuses to offer products are downright insultingly greedy.
I see non-EV Broncos everywhere here in Reno, and I also see EVs everywhere here in Reno. I would therefore expect to see EV Broncos everywhere here in Reno if they existed in the US market.
I also in particular see Cybertrucks and Rivian R1Ts everywhere here in Reno, so the very specific demand for electric pickup trucks clearly exists.
I get that's an apples-to-oranges comparison, considering that labor and material costs (not to mention subsidies and regulations) are probably not the same. But even at $40k, it would be cost-competitive with other EVs if nothing else.
Isn’t there a e) have investment at the federal level in R&D, specifically for industries that matter (economy, national security etc)? For automotive, China didn’t become the EV leader by accident. It was a deliberate national strategy, with funding to back it up. Yes there is cheaper labor, different regulations etc. But also in no small part to federal funding, investment in R&D etc. why are we surprised then that the US is in general falling behind?
The US could invest more in battery tech, manufacturing automation, robotics etc. This both lowers cost and increases product competitiveness.
> The US could invest more in battery tech, manufacturing automation, robotics etc
The US is investing in batteries. Domestic production has increased rapidly over the last couple of years and is continuing to do so. The US can now produce domestically all of its battery needs for grid storage, for example.
This is due to government incentives from the Inflation Reduction Act.
There should be a time limit to protectionism and a scale where tariffs on imports come down overtime. Otherwise you will get what you currently have in the US ie huge cars that cost a lot of money to make and run. US supposedly the free economy is the country where almost every industry is an entrenched virtual monopoly or a duopoly and with it's political finance system they are eating into every industry.
Its an inevitable state of any market system (especially if regulated). Eventually it will become more profitable to use the gains of capital to buy protection from regulators, instead of investing in ever smaller business improvements. Using money to defeat competition is ultimately inefficient and generates lower returns for investment. Unless regulators are totally insulated from the market, they will have a stake in selecting winners and will eventually construct moats that others can't cross, as that provides the highest returns to capital, and the greatest rewards to regulators.
Monopoly is the most market-efficient vehicle to deliver returns to capital, and the most natural state of the market; one player using advantages and gains eventually destroys all opponents. Smaller players can never gain a foothold due to the incumbents being so efficient and far ahead, and it makes more sense to merge with the front-runner, allies, or be destroyed (hence the competitor pool keeps shrinking).
These are features of the system that naturally emerge without counterveiling forces.
For example, AI companies will shortly find its cheaper to just get the government to constrain their competition. The alternative is many companies spending trillions to eek out profits, a poor state to be in. Regulators want money and power, so its in their interest to create this protected state, as the "free and open market" isn't buying elections or vacation homes. And of course, any unprotected competitors left behind will die, consolidate, or sell to the victors; so we will eventually have a "winner takes all" system where one or two big players dominate. Any startups will either be quickly destroyed as people ask "why use a worse product", or will sell to the monopoly when they realize they can't afford to spend $1T training models and building data centers, and complying with all the regulations.
My point is that protectionism (in any form) isn't something to bring down over time to encourage competition -- the system can't naturally function that way, as it would require each player to go against their own interests. Instead, protectionism is a natural ever-increasing good that will be cultivated for the controlling capital and regulators in the system. We only see the "free market" operations during a time before market / regulator capture, as that's the time when there aren't yet dominant players who can guarantee power and money to the regulators, and there isn't enough consolidation of capital to immediately destroy all competition, but its an unstable market state.
Historically being WW2. I'm not sure they've contributed much to the "war effort" since then.
A legacy of WW2 was the explosion of the whole defence industry. While a lot of the civilian factories got repurposed in WW2 to build trucks and planes and ships, the tech in all that stuff was very basic. For example the aircraft carrier Yorktown was "fixed" (at least good enough for the Midway battle) in 3 days. I somehow doubt a modern carrier could do that, simply because of the tech required. The US built 150 more carriers in the next 3 years.
The defense industry today gets a trillion $ a year. There's no civilian ship-building to speak of, and military vehicles are now highly specialized.
So why keep Ford et al afloat? Politically it's sold as "national security." In reality it's like more "they didn't die on my watch." And of course, having the ability to make local affects the supply chain. [1]
For example if China invades Taiwan, the US loses pretty much all electronics- especially PCs and Phones. That's a lot of leverage for a foreign country to have.
[1] US cars aren't really local - that's a fiction exposed by the proposed tarif on "car parts", which the industry squashed. In reality car parts are made all over the place (including the US) , and then assembled in the US (or anywhere else.)
Mercedes Benz and other car companies in Europe are going into defence directly as EU is investing more so any company in the engineering space see potential new market growth
> Should we get into a big war, we'll likely need mass production of military vehicles and having mass production of consumer vehicles is a good start.
And all those military vehicles we build will be destroyed by tiny fpv drones that cost a tiny percent of what the vehicles cost.
Why do people cling to this WW II era idea that we need car factories in case we go to war?
Those tiny fpv drones pack a tiny punch. Sure, it will destroy a current generation Chevy Equinox.
But two weeks after the war starts, countermeasures will be created. The vehicles will be changed to make them harder to find, and harder to kill. A small drone will be rendered ineffective by small countermeasures.
As much as I dislike the current US administration, Ford moving to making missiles and other military hardware is a good idea. They sure can't build a cost effective vehicle; yet there is a lot more potential profit in a Standard Missile, not to mention less competition.
> But two weeks after the war starts, countermeasures will be created. The vehicles will be changed to make them harder to find, and harder to kill. A small drone will be rendered ineffective by small countermeasures
Where did you get this?
Nobody solved FPV's in four years, why do you think US or any other country will solve it in two weeks?
"small drone will be rendered ineffective by small countermeasures" – only a person that lives under a rock and doesn't follow RU-UA war in any way can say such things.
> c) subsidize local production out of the "national interest to support this industry" budget. This has the effect of ramping up demand, hence production, hence production being developed, and eventually getting cheaper.
We already have a trillionaire from subsidizing local production.
Where do interest rates factor in to your calculus? We've just had really cheap money for a really long time in the US and the car makers seem to have adapted and found ways to sell vehicles for more. A top of the line raptor has a tremendous amount of power and interior amenities. Oddly, they're not uncommon, I see landscapers driving them around. Maybe not the very top line Raptors, but I do see Raptors and that seems like an awful lot of truck to pull some lawnmowers and sprinkler parts around in. Low-interest financing and then we've never had high gas prices for terribly extended periods of time.
I don't know that I think the US manufacturers have taken "inexpensive, but good value" cars seriously for decades. The least expensive Ford vehicle, I think is a Maverick which starts around $28k, Hyundai, Kia, Toyota, Mazda and Honda all have cars under $25000.
Like many things, it seems like a combination of all of those would work better than any single one, depending on the actual goal. If the goal is to help drive EV adoption, tariffs that raise foreign prices to the desired price point, rather than simply being more expensive, would provide competition to the America companies, perhaps driving improvements. Subsidies would help with labor and ensure the company keeps driving the right direction. Improvements to products can help sell "American made" as a good thing.
Before deciding on a solution, Governments also need to decide on what problem they are solving. Why do they want to protect domestic automakers specifically?
Is it national defense synergy / surge capacity reasons? Is it general manufacturing know how / impact on overall domestic manufacturing supply chain? Is it jobs for current workers? Is it to keep the pensions solvent for retirees?
I saw a comment re: this issue in Europe where a Portuguese commenter asked why it was fine for the Eurocrats (lead by Germany) to let all their apparel jobs go overseas, but now he doesn't get the option of buying a Chinese car because German auto jobs need protection. There is something of a point there.
I'd be OK with tariffs if they are not meant to simply keep foreign car companies out of the US, but rather to encourage foreign car companies that want to enter the US market to build factories in the US and build their cars here with US labor.
There would probably still have to be tariffs on parts so they can't just ship all the parts here and just assemble in the US, but if they come here and build cars with US labor and with much of the supply chain being here too and are still causing headaches for the US car makers I don't see why American consumers should care.
Allowing foreign competition is a forcing function to be more productive and innovative. Japanese/German competition didn't annihilate US car industry, why would Chinese cars do it?
Cars are a way to signal status. Americans don't want to buy cheap cars, because cheap cars means low status. They'd rather go into significant debt and keep up with the Joneses. The people buying pickup trucks and SUVs are mostly picking up their kids from elementary school which is half a mile away.
Last time I looked at the total labor costs of producing a car in the US versus China or elsewhere and it was laughably small compared to the sale price.
Auto manufacturers did this to themselves thinking they could outsource all the heaviest labor portions and pocket the extra and that either the foreign labor would stay cheap and not foster the development of the industry in those countries or local labor would magically be ready whenever they needed despite being starved for decades. But they were wrong on both counts. And on top of all that they squandered all that extra profit they made so they can't seemingly afford to drop the capital needed to return to the cheaper high-volume low-margin market, atleast not with the massive managerial burden they have built up and sustained.
This seems to fill a useful niche, but may be too downscale. Remember the Tata Nano.[1] Tata built a basic car with a price below 1 lahk, but it didn't sell.
In the US, there's Slate, which claims to be making a small electric pickup truck.
"Preorders will start on June 24, 2026. First deliveries are slated for late 2026." [2] Price in the US$20K range, they claim. Claimed range is 150m with the base model battery. A larger battery is available. It's America's answer to the kei car. If it ships and keeps shipping.
Detroit got way too much into the "more car per car" thing. Chevrolet once had the slogan "basic transportation". They lost sight of that market. The giant pickups are just silly.
Are we just ignoring data now? Giant pickups have silly sales- silly in the crazy high sense of the word. I love my EV but I have never wished for less range. The Slate is a toy for the wealthy, like kitted up Jeeps that have snorkels
If it shows up in the suggested price range, it's going to one of the least expensive new vehicles on the market.
Yes, it has less utility than many other vehicles in many ways, but the bed length (5 ft) is longer than a lot of trucks I see on the road which enables carrying certain kinds of loads that aren't easy in cars or trucks with very short beds as seems fashionable now.
150 miles isn't a ton of range, but it's 50% more than a first generation Leaf and those sold.
The Slate clearly isn't trying to check all the boxes, but every vehicle doesn't need to try to do everything.
Bed length is a silly metric to use. It's single dimensional and doesn't capture any of the other important metrics. Such as width, air-volume, cubed-volume, or weight capacity.
Slate's 5 foot bed is on the shorter end of common bed sizes. Certainly shorter and worse on every other metric than the F-150/Silverado/1500 'short bed' so commonly seen hauling air in the US.
Giant pickups have silly sales because pickups in general have silly sales and there are basically zero non-giant options in the US market (thanks, Chicken Tax, very cool).
The Slate would be the absolute perfect truck for me if it had a 4WD option. Being RWD-only is the only thing making me unwilling to replace my Tacoma with it.
How often do you off-road and need 4WD? I have a Jeep Wrangler, and in winter I have to go up a muddy hill with about a 15% grade to a back pasture at a stable.
I sometimes engage 4WD (high) for that, but I don't really have to.
Very few of the giant pickups I see have mud on them.
I off-road an average of once a month, specifically to reach my usual shooting spot on BLM-maintained land. I don't necessarily need 4WD for that, but it's a good excuse to turn it on anyway.
I “need” 4WD when it snows, since 4WD/AWD + snow tires = not being required to chain up when chain controls are in effect, and because 4WD > AWD > FWD > RWD when it comes to snow driving (especially here in Reno/Tahoe, where the snow/ice happens on hills and having more drive wheels is a strict improvement over fewer).
> This is one of those "the internet is a fad, it'll never catch on" moments. EV's are here to stay. They're going to win. That's pretty obvious to anyone paying attention.
That's not clear at all from the long-term habits of American consumers. Why did Ford, GM, and Stellantis all cut EV investment and increase ICE investment in the last year then?
Short term buyer habits don't necessarily track technological progress - they tend to be resistent, then inertia is broken and consumers buy en-mass. Companies need to brunt to cost of innovation until the cost benefit analysis makes sense for consumers. Mobile phones were a passing fad for niche power users until companies threw so much money at them so they weren't, and we became reliant on carrying one. Same can be said for thousands of other products. Nobody used them until suddenly we all were.
We're seeing a moores-law-like improvement in electric cars and their power densities. If the American car manufacturers don't want to be a part of that progress, it's on them, but Asia and Europe will continue to innovate in that area and the US will be playing catch up because they're servicing what consumers want now, not what they will probably want in the future.
Because they are focused on short term returns, not long-term strategy.
In the short term cutting r&d, killing off "not yet profitable" lines etc all lead to improved results this quarter. Who cares about 5 years, or 10 years from now?
If you look beyond the US then you see EV market share growing year on year. Yes, the US is resisting hard, but you can't hold back the tide forever.
Kodak invented digital photography, but kept going with film. In the end the world moved on, even if they didn't.
50 years from now ICE will be a niche market. And if US producers want to own that niche, well that's great. But it'll be a tiny fraction of what they are now.
EVs are roughly at two thirds market share in the largest car market of the world. The third largest market has them at 20%. Funnily enough, India (4th largest market) is slightly ahead of the US for EV adoption in passenger cars.
ICE cars will be a niche market much more rapidly than 50 years.
The US is again exceptional insofar that it is actively pivoting to become a petrostate. Even petrostates have been trying for a while to not be petrostates any more, which could be telling for the US electorate but isn't.
5) Force outside companies to partner with local companies in join ventures with IP and knowledge sharing. This strategy seems to work remarkably well when you have a captive market others want to break into.
I think the idea of public transport or rather functional public transport is completely omitted in that context of this country, isn't it? That alone can be a huge local competition as there should be.
The playbook to study is South Korea. Protectionism and subsidies for nascent and transitioning industries with a clear ex ante timeline to full liberalization to force international competitiveness. Absent the latter, American car companies’ inefficiencies in design and labour structure have zero incentive to change, and American consumers get stuck with shitty, expensive products.
For cars, this would mean federally-guaranteed loans up to the median value of a plant for any manufacturer with any production base worldwide (the plant to be built or retrofitted in America, of course) plus an N-year (N set to the expected payback period for a new or retrofitted plant) tariff schedule starting very high before decreasing to virtually zero. Maybe also pass a special bankruptcy regime to expedite the redistribution of assets for those who fail to really send the message that failure is an option.
I feel like the "clear ex ante timeline" is a big problem for us in the US. A prominent feature of US politics (and indeed culture) is constantly setting such targets and then chickening out and moving the target back as the time approaches. That in turn creates a sort of moral hazard where no one feels an urgency to meet deadlines because they know they'll be loosened up later.
> A prominent feature of US politics (and indeed culture) is constantly setting such targets and then chickening out and moving the target back as the time approaches.
I'm not an American, so I want to check with this: this is normal for the broader culture? Not just Musk?
Musk is an extreme case but the general pattern is pretty common. See for instance rules passed in various jurisdictions to the effect of "a budget must be passed by date X", which then is circumvented via loopholes or changing the law so that deadline no longer applies.
Hmm, maybe a carrot with liberalization? Tax benefits to the car companies come to mind. But I’m almost more of a fan of creating a monetary incentive for the lenders with the federal guarantees—if the liberalization gets delayed or derailed, they lose money.
None of these strategies seem to address the other technological issue hiding beneath the surface, which is that EVs are fundamentally simpler (electric vs combustion motor) and hence should be cheaper than ICE cars when manufacturing pipelines are mature. This would result in lower profits across the car industry even in the absence of international competition. No US manufacturer so far has actually tried to build EVs cheaper than gas cars at scale (Tesla made a little noise and then got distracted), while Chinese manufacturers have no need to worry about cannibalizing the comparatively small domestic ICE market.
Letting the industry guide policymaking seems like it could lead to regulatory capture preventing EVs from reaching the (low!) price points that they should reach. Already the two-track emissions standards and chicken tax make cars too big and the "arms race" of having a bigger car than everyone else to stay safe (at the expense of others) prevents meaningful reform.
The "secret sauce" of being an OEM is integrating a good set of properties that sells at a price point that sells.
Yeah, they have a lot of $$ historically invested in good engines but they don't care that much. They'll buy engines from each other whenever they want. They don't see it as a critical moat.
One might wonder why the Ford CEO cares about low cost foreign cars when Ford doesn't even make any. They have shifted all of their lineup except one car model to higher- margin compact SUVs, SUVs, pickups, and full size commercial vans. And that one car, the mustang, another one marketing exercise on four wheels with accompanying margin markup - not exactly a practical entry level car.
Oh, but the poors but the used cars and competition for their business will lead to greater supply of used cars, diminishing the resale value they can point to to justify purchase of their high-margin vehicles. Can't have that now.
It wouldn't matter if it was 50%. Shareholders have the expectation of the number getting bigger every 90 days in perpetuity. If you want better vehicles to increase sales and compete better against international competition, you need to have the rank-and-file feeling like their work will matter not just for the company, but for them too. That's diametrically opposed to the number getting bigger.
>This is one of those "the internet is a fad, it'll never catch on" moments. EV's are here to stay.
Not saying you're one of them (there are other people here who fit the bill much better) but like with anything else the people on the internet peddling grand narratives lacking of nuance are delusional fanboys, malevolent liars or some combination of the two. EVs are absolutely going to win certain market segments and take good chunks out of others. Unless the government gets out of the business of regulating the crap out of electrical infrastructure at great cost to us all there will likely be a whole bunch of heavier use cases where they just can't pencil out barring some yet unforeseeable breakthrough in the basic physics of batteries.
I think the auto industry is wise to think about the upcoming ~30yr transition period where all that shakes itself out and how to invest the right amount into keeping ICE stuff competitive but without investing to the detriment of winning the EV segment, etc, etc, standard big business stuff.
I’d be surprised if there’s a consequential ICE industry after 2040 (that doesn’t mean there won’t be ICE cars being driven, just that they won’t be selling outside niche industries after 2040).
The collapse of ICE vehicles will happen sooner rather than later due to a few fundamental reasons.
- China has gone all in on EVs. It’s hard to compete against the Chinese and they’re unlikely to ever develop the skills and capabilities to develop cheap ICE vehicles.
- The Strait of Hormuz fiasco has pretty much convinced countries about not being dependent on gas. Electricity is an energy abstraction. It allows you to run your EV no matter where you get your energy from because almost all sources of energy can easily be converted to electricity. Running your vehicles on this abstraction provides a lot of sovereign flexibility.
- ICE infrastructure is incredibly expensive to maintain. You have so many dedicated gas stations spread out all over that use up valuable space and resources, but also then need to be supplied with gas coming from all over the world. As EVs take meaningful share from ICE vehicles, the cost of maintaining this infrastructure for each ICE vehicle driver will keep rising. As demand goes down, gas stations will start shutting down, and then the distance between 2 gas stations or your home and thr closes fast station may increase, and range anxiety will start working against ICE and in favor of EVs.
- ICE vehicles are 100+ years into their development. EVs are just getting started. And they’re almost close to parity. It’s not clear how ICE will maintain any edge outside of very niche use cases as EVs continue to improve.
> I’d be surprised if there’s a consequential ICE industry after 2040
It started in the 00s, really took off around 2010.
And don't forget that 2040 is in 14 years. You can buy plenty of brand new ICE cars today, the majority of them will definitely still be around in 14 years.
I agree with you, for the mass consumer car market (individual/family transport) as a whole. It's coming fast. However, the current EV technology (mostly batteries + charging) is not a good fit for a whole lot of edge cases, and in the aggregate they matter, too, and thus the ICE engine industry won't really go away anytime soon:
* General-purpose Semis for commercial hauling. Yes, there's some EV Semis on the road today - pilot projects, or specific routes on specific schedules. But there's a lot of general purpose semi-hauling that happens every day on odd/long routes without sufficient chargers in the right places, and they need much bigger chargers. And then there's the specialty semis that carry large/wide loads. I see them almost every day in my area, carrying large chunks of power substations, heavy manufacturing equipment, blades for wind turbines, etc.
* Fire trucks, Ambulances, Tow trucks, Police cars - For various similar reasons, it's tricky with some of these, although in well-constrained cases and with extra vehicles on tap as backup (when the other one is low on charge in an emergency), maybe can kinda work, eventually.
* "Personal" trucks that see heavy towing/hauling use (think: hauling a livestock trailer or farm equipment or heavy materials (or maybe an EV race car!), possibly long distances on a regular basis). The battery range really suffers when you put all the extra weight and drag on by towing, and people aren't willing to turn what was a 5 hour diesel trip into a 9 hour trip with supercharger stops (more time in the heat with animals, more time on the road in general, and do you have to disconnect the trailer just to reach the charge cable?)
* Backup generator ICE engines - home, datacenter, industrial use, etc. The problem here is mostly runtime and peak watts of output vs cost. You can use a battery-based solution for most of these cases, but it currently costs prohibitively more for the same performance specs. When they're being used in austere environments, sometimes there's no electric grid to even charge from, so slap on a massive solar array cost, too.
* All military use of ICE engines in general (transport, generators, etc) - Not insignificant in scope and scale, and obviously they're not going to run EVs or find chargers on battlefields.
These cases will diminish over time, especially as we continue to make advances in charging and especially battery technology, but it will probably take a few decades because there's science challenges, not just engineering ones. The military case might never go away.
ICE cars/vehicles aren't going to disappear overnight. There are enough used ICE vehicles for ALL of the edge cases and a ton more for the next 20 years. There is no need to buy new ICE vehicles.
Look, sure. No one is saying "no ICE ever". Some people still ride horses.
125 years ago cities were built around horses. Stabling. Breeding. Feeding. Grooming. Street cleaning (turns our horses poop a Lot). By 20 years later that's all gone.
Sure horses survived in rural areas. Sure the Amish use them today as then. But the horse-based industry has (in real terms) vanished.
ICE is headed the same way. It will exist, but no daily-driver car will be ICE. EVs win, because in cities they are better. Because they're cheaper to own.
If Ford wants to own the ICE niches, fine. But it won't be cars.
It's not quite that simple though. A lot of these edge cases are necessary for everyone to live their cushy little city lives. It's not a matter of outmoded things. We will still need ambulances, and we will still need livestock trailers, and everything else on my list, for all of the foreseeable future. Unless batteries and charging gets a lot better, we'll still be manufacturing and improving ICE engines for many applications. Just not simple passenger cars.
> there will likely be a whole bunch of heavier use cases where [EVs] just can't pencil out
Do the big Detroit automakers also build a lot of semis, garbage trucks, snow plows, and fire engines? I can see those types of vehicles being ICE holdouts. But certainly not anything you can drive with a regular driver license.
I’d argue that garbage trucks, snow plows and fire engines are candidates for EVs. They are large and heavy with plenty of space for batteries. Typically used in predefined routes, traveling less than 100 miles per day.
I would gladly vote for a bond to fund electric trash trucks if that resulted in quieter weekly trash service.
I meant more like bog standard 1500-5500 sized trucks and vans. Depending upon the actual fine details of the use case it's gonna be hard to make the math math.
Your local DPW with a lot of money for new over spec'd trucks, friendly permitting office approving their permit for charging infra, strict 9-5, etc might make it pencil out for their facility maintenance. But a landscaper who's engaged in fundamentally the same work but out of rented space, a landlord that won't get preferential treatment on the install of charging infra, won't qualify for the same fleet discount, works way harder than 9-5, etc, etc. might not make it pencil out.
Local delivery can potentially make great use of EVs, but if you turn up the operational tempo or the range and have drivers slip seating or really racking up the miles it can be a non-starter vs just buying the same thing in non-ev. And of course the fixed infrastructure cost questions still apply.
You might get hybrids but you also have to remember weight matters in a lot of these applications. Can't be rolling around over weight as part of normal business. And a lot of these applications are trying to stay under 10k while still having as much cargo capacity as possible.
The current Chevrolet Silverado EV has a 200 kWh battery option. Even with towing reducing the range to say 200 miles, you could do a lot of pickupy things with that.
Yes, it won't happen all at once. And some use cases will survive longer.
I'm not sure size is the qualifier though. Electric busses are becoming more and more common. I think city vehicles make good candidates for EV - they don't typically go far from home. They are cheaper to build and buy, and much cheaper to run.
The reason I think EVs win is because of the "support system" ICE vehicles need. And as ICE share decreases that support system also starts to dwindle. So those services get more expensive. I'm thinking gas stations, mechanics, parts and so on. It becomes a death spiral.
It's not unlike the switch from mainframes to PCs. At the beginning there wasn't a contest, but now mainframe skills are hard to find and hence very expensive. So the market for them goes down. Indeed most mainframe suppliers (DEC, SUN et al) died off ages ago.
> It remains to be seen whether the Olinia One will face similar pushback from the U.S. once it goes on sale.
> can travel up to 125 kilometers (77 miles) on a single charge
The US market generally rejects small-range EVs, except in very niche markets. In order to succeed in the US, it will need roughly 3-4x the range. In order for this to succeed in Mexico, their market will need different driving habits than the typical American.
(I know this as a former 2014 Leaf lessee. Short-range EVs only make sense when they are the only option in my price range, and I really, really want to drive an EV. Maybe the typical Mexican rarely drives far away from home? Or maybe this is for a niche of Mexicans who really, really want an EV and will tolerate a short range?)
I know absolutely nothing about Mexico in terms of geography or driving so I wonder how feasible an EV that you presumably constantly have to charge is going to fare. In the US, a range of 77 miles is a complete non starter. You'd have to charge it every single day. If not multiple times a day in some peoples cases.
It's interesting that info about the car is only half the article. The other half is a commentary on how US politicians are desperately trying to keep foreign EVs out of the country, lest it hurt corporate profits.
> In the US, a range of 77 miles is a complete non starter. You'd have to charge it every single day. If not multiple times a day in some peoples cases.
It's true that some people drive more than 77 miles per day. But a pretty big chunk of people never do, except road trips/vacations. It could easily be worth it to buy a cheap EV for everyday use and then rent a vehicle for long trips.
Yep, you can pick up used Leafs for super cheap (under $10k, sometimes substantially) and if they fit your use case, they're an amazing deal. Mostly helpful as a second car for a family, or as a city car for someone who never plans to road trip in it.
At the time we were a 2-car household and used the gas car for longer trips. That being said, there were a few times we had to scramble:
Once, when it was very cold my wife and I both needed to drive a long distance. I took the Leaf because I had access to a charger.
On our last year of the lease we ended up having to move 90 miles away. When we bought the Leaf, we never planned on driving that far. Due to circumstances, I had to make multiple 90-mile trips in the Leaf.
---
Case in point: I now only recommend that class of Leaf to people who need a 3rd car for a teenager and no intention of moving.
We considered getting a used Leaf but my wife had too much range anxiety, even for vehicles with 70 miles of range. I plotted out on a map how many trips she would have to take in a day (to work, to doctor, to pick up kid, to dentist, to store, etc.) in order to come even close to 70 miles. Of course, she never goes that far around town (only when visiting relatives, when I typically drive and we take a PHEV). But the RA was too great, so we got another PHEV. It has been useful at times to be able to both go 50+ miles in a day without any concern, but it's literally a handful of times over the years.
> (only when visiting relatives, when I typically drive and we take a PHEV). But the RA was too great, so we got another PHEV. It has been useful at times to be able to both go 50+ miles in a day without any concern
After the Leaf, we ended up with the Chrysler Pacifica PHEV and a Model 3. The PHEV had so many problems that I'll never recommend them, and dumped it early at a loss and went all-electric. (Both cars). We will never go back to gas.
IMO, the main thing EVs need in the US is a good publicity campaign, more chargers, and better legislation of chargers. The technology is now "good enough" if you have access to a charger where you park overnight, and "almost there" if you can't charge overnight. (IE, if you rely on street parking stick with gas.)
Sorry to hear about the lousy Pacifica. We have a friend who had a good experience with it, but one reason we never thought seriously about it is Chrysler's reputation for reliability.
I think you're right about the tech being "good enough" in many places, but it depends on weather (colder climates are not as good). I also know people who live in temperate climates that refuse to have their only car be an EV because of emergencies and power outages. As someone with two cars, I don't have that concern, but I can understand why someone (especially an older person) would not want to go all in on electric, if the grid is not super reliable (and would likely be offline in a natural disaster, when they would need to charge and possibly flee).
I live in the Northeast. The Leaf had problems with extreme cold, and my 2018 Model 3 lost a lot of range because it (surprise) had resistive heating.
My 2022 Model Y and 2026 Hyundai Ioniq 9 have heat pumps and generally work well in extreme cold. It's also nice that I can preheat them in the garage. Most importantly, they don't lose range overnight in extreme cold like the 2018 Model 3 did. I charge the cars before large storms, which is much easier than fighting traffic at the gas station!
It is weird point to be in. Almost a daily use of that range or significant part of it. As with less than daily use and short distances fuel is lot less critical. I am use case of going to shops a few times a week. Savings on fuel is not big thing as there isn't much used.
And then when I actually need to travel longer distances the range is much more important.
So EV would need to be very cheap to start making sense overall.
> Or you own more than vehicle. Plenty of families own multiple vehicles, and they don't all need to have tons of range.
I wish there still were small and very cheap EVs to fill this niche.
We had the Fiat 500e (somewhat infamous) $82 lease as an extra car because for $0 down and $82/month, why not. Range was small but it was perfect for around town, and had other cars for other things. Anytime I was driving within town I'd just take the Fiat.
At $8500, I could justify having a 77 mile range electric car with a top speed of 30ish mph. That would take care of every in-town trip, but I couldn't do a full commute to work with it because the most sensible way of doing that involves a highway. If it could manage 50mph for 15 minutes, it could go on the highway and I could recharge at or near the office.
The cheapest EV currently available in the US is the Chevy Bolt, at $29000, about three times the price. A Bolt has four times the range, but still not quite enough to go one way on my most frequent "long drive".
> The cheapest EV currently available in the US is the Chevy Bolt, at $29000
The interesting thing is that this appears to be largely because the manufacturers, rightly or wrongly, do not think that the US market _wants_ cheaper EVs. The id.Polo (about 20k with incentives in most countries) won't launch in the US, for instance, even though the id.4 did.
> I know absolutely nothing about Mexico in terms of geography or driving so I wonder how feasible an EV that you presumably constantly have to charge is going to fare.
Hey at least you admitted that upfront. Average driving speed in Mexico City is 15 km/h so one would have to spend 8h driving to deplete the battery in a day. Typical commutes are perhaps 1h one-way but again, distance wise probably only about 40 km both ways. So this 125km range easily covers it for most people.
I think energy cost is more of an issue for most. electricity is expensive in Mexico City especially compared to base salaries. And electrical infrastructure was never built to handle high power consumption. Most apartments have a single 30A breaker for the entire house. Most heating is done by gas and air conditioning is not widely used. For most people charging speed will likely be limited to about 10A at 120V.
That's pretty much standard operating procedure for any EV. That's one of the perks of owning an EV. Plug it in when you get home from work, and have a full "tank" every morning. Plus you get the cabin preheating using the wall electricity.
If you have a charger at home, or at work, why does it matter if you have to charge it daily or weekly? Yes, for some lifestyles, range matters. For others, a 125 km range is perfectly acceptable
For a significant segment of the US population, that thing wouldn't get them to work and back, so they'd have to charge it both at home and at work. And in many cases, forget running any errands, picking up kids from daycare, etc.
And minimum speed on US interstates is typically 40mph, so that reduces its usability even more.
> For a significant segment of the US population, that thing wouldn't get them to work and back, so they'd have to charge it both at home and at work.
What does 'significant' mean here? I find it hard to imagine that a _large_ number of people have a round-trip of like 100km to work; that would be horrendous.
People move around: that's what cars are for. Trucks may not be "designed for urban areas" (whatever that means), but they certainly go into them on a daily basis.
I think you wildly overestimate how many Americans are white-collar workers commuting 100 miles to a 6-figure job. A <$10k EV was never even remotely aiming at that market to begin with.
With a range of 77 miles, I wouldn't make it to work and back. Everyone I know (yes, it's anecdotal, but a widely-shared one) has to commute on roads where the average speed is well above 30mph.
> You'd have to charge it every single day. If not multiple times a day in some peoples cases.
Charging is not a problem when a car is stationary. It is parked next to a building, building usually has electricity (unless you are Amish).
I don't know why most people don't understand electricity is available everywhere, but petrol is only available at gas stations. You have to somewhere to pump gas, a major inconvenience.
At least once a week. I commute 120 miles round trip one day a week, 180 miles 1-2 times a month, and 300+ miles 6-10 times a year.
I also have 3 kids, a dog, and don't live near a city. If I lived in a city dogless and childless something like Zipcar would make much more sense.
BTW: The "transaction cost" (time) of frequent car rentals is a non-starter. One of the things I hate about renting a car is that every time it's a different car, some I like, some I don't. I just want to pick out a car I like, have it ready when I need it, have it set up the way I like it, and have my "box of crap" in the trunk where I know where it is.
I don't want to navigate through a young ambitious salesperson trying to sell insurance, or the AI car scanner charging me hallucinated wear and tear.
This new EV is to replace motorcycles and scooters that are ubiquitous in mexico. If it succeeds in getting 100k people off of motorcycles it will have the side benefit of reducing healthcare costs treating motorcycle accidents.
Huh, the speed limit is odd because in my urban/city driving in the western US (San Diego, LA, SF, Portland and Seattle) all major cities still basically necessitate non-zero highway driving. Even mopeds (and bicycles) can pretty easily exceed 31 mph.
I've spent about 2 months total in Mexico City and there are still in-city areas where it'd be common to exceed 31 mph. The main rate limiter being traffic...
Anyway not to pooh-pooh the idea too much, I am sure there are plenty of use cases but maybe enabling a top speed of 55 mph would increase utility IMO
An amusing coincidence: the maximum allowed speed in Nicaragua is 50 km/h
If This wasn't about to countries in America, I would suspect something technical behind those decisions. The only thing I can think of is the loss of energy efficiency when driving over 60km/h
The limits on range and speed (reported 50kph) would make it a horrible deal for the average American.
150k pesos (~$8.6k) for a brand new wheelchair-accessible city van seems like a killer deal in the Mexican market. That would come on the market for less than a used air-cooled VW beetle (ended production in Mexico in 2003)
Can’t you get a much better used car for that? that’s probably one of the reasons why there is not much demand for basic cheap cars with no features in Western countries at least. Modern cars are much more reliable and last longer than they used to several decades ago and stripped down budget models can’t compete with that.
NYC taxis drive an average of 180 miles per shift[0] so they'd need to triple the range or have some sort of system where they can swap their depleted taxi for a freshly-charged one mid-shift.
Yeah taxis in the capital and small people movers to go from hotel to beach is where these will shine. EVs are especially well suited to stop and go traffic as well.
People are so caught up trying to solve every use case at once. Dropping pollution caused by old taxis in city centers will be a big win for Mexico if they can hit their price point. At the price they are quoting fleet operators can buy 2 and have their drivers swap out mid-day during their lunch.
> can travel up to 125 kilometers (77 miles) on a single charge
This would be a big hit in European cities. I own VW e-Up! and it's a perfect EU city car. With it's 375KM range, I rarely charge it more than once a month.
> The US market generally rejects small-range EVs, except in very niche markets. In order to succeed in the US, it will need roughly 3-4x the range
I mean, I assume it is not the case that literally all Americans regularly make long journeys. There probably is a market.
> I know this as a former 2014 Leaf lessee.
That was a lot more expensive than this.
The Dacia Spring has a range of a little less than twice these, and I see a good few of those around. Those cost about 15k EUR (17k USD). I'd definitely buy that there is at least _some_ market for something half the cost and half the range.
Even a used Nissan Leaf with degraded batteries is a viable vehicle in many U.S. cities. I would not call these markets "niche", there are many mid-large metropolitan population centers where they are practical. To use "niche", is either a political denial or ignorance of the population distribution of the United States. They are popular where I live, I drove one as a primary vehicle for 8.5 years, and I have purchased another used Leaf for my teenager. The empty pickup truck is also a "niche" vehicle with this usage -- it clearly isn't an appropriate choice for every driving need and locale.
That was my thought too. They obviously won’t face pushback entering the US from a legal standpoint, but I don’t think consumers will tolerate a sub-200 mile EV well here
I wonder how this compares to the late '60s and through the '70s, when small, higher-mileage imports were eating the US car manufacturers' lunch. It feels more existential, but maybe not?
"The car’s unvieling comes as some countries around the world continue to push EV adoption with better and more affordable options. The U.S., however, has taken the opposite track."
Lol, so true. I honestly don't mind waiting for an electric car since I hope to get more mileage out of my current one. If it lasts 10 more years, all the better.
The cars available then should be far better (other than new things I might not want- e.g. more automation).
Hoping this brings EV infrastructure up in the country. A road trip is still quite an ordeal due to the lack of fast chargers in highways and maybe that's why the range on the first version of Olena is low, as it's aimed to provide "ultra mobility" within cities and not outside of it but still, glad to see the MX government invest into renewable technology.
Personally, I'm very happy about the increasingly competitive EV market. Hopefully they will start exporting those to the British market. Don't we all love cheap things?
Motorcycle licensing is a bit specific( at least in California ) even if one has an automobile license, I only looked at it casually, have to buy special clothes for the training class and pass before getting learners permit to get practice for taking state test, but most of the skills learned in the training class are not applicable to this vehicle AFAIK. I would speculate it's closer to a Japanese small form factor Kei truck which are importable under certain restrictions - which must be 25 years old or older, not legal for public road use in many(most?) places due to bumper/crash testing/airbag requirements, though I've seen a couple in California in suburban/rural areas. Also see tourists driving essentially golf carts in places like San Diego on downtown streets. It seems murky to me.
Have you ever paid attention to what's on the road in Mexico? I've driven there for 30 years and I've seen it all.
Then, there's the idea that Mexicans might not be able to manufacture a quality vehicle. My 2001 Toyota Tundra was manufactured in Mexico and I will drive it until I die. Basically a grail vehicle.
Places like Monterrey have multistory quite modern BYD dealerships. You might start shopping for monasteries ;-)
Hopefully they can also find a good balance between using cheap parts to actually being safe and comfy. The cheap EVs on the market normally lack in one of these.
I have not yet found any interior shots online, did any of you?
This vehicle is what most Americans would call a "golf cart". If it doesn't have safety features and can't be driven on highways, it's not really competing with normal cars, so I'm not quite sure the article's analysis makes sense.
The amount of power used to keep a car going at highways speeds is 60% air drag. With how much people value range in EVs, why is it that almost every manufacturer designs theirs as literal boxes on wheels with some lights and doors? Cars in the 1920 almost had better aero and they had no idea what it even was.
These are usually called LSVs; the number of these is low but growing because in dense urban areas or planned developments (golf courses, parks, senior communities) they're far more cost effective.
counterpoint: I have an EV that I never drive more than 77 miles a day and I paid over $70k for it. Top speed would definitely be a limiting factor, but I do think there's a huge gap in the mobility market between e-bike and a traditional (and expensive!) car.
For the people who don't believe this, spend some time watching urban traffic in a place like Oaxaca. 4 is a bit of a stretch unless it's a couple of small kids (that happens) and the moto is not really a moped, but not much more powerful. There's occasional bulky cargo. I am also reminded of the multiple times we were riding in a bus in Cairo Egypt and passed a donkey cart in the left lane of a 6 lane-ish "free"way.
One of the first things I thought when I first saw this thing is, oh, there will be mods.
The Ford CEO is not wrong. Allowing foreign imports into the country at prices far below what US producers are able to make will decimate the local car industry in the US.
There are 4 possible solutions to this problem;
a) convince Americans that it's worth paying more for a locally built product. This is the simplest approach, but there's only so much margin here that the consumer will tolerate. At the moment this gap is too large.
b) Tariff foreign imports to raise their cost. So the US consumer pays more, whether they like it or not.
c) subsidize local production out of the "national interest to support this industry" budget. This has the effect of ramping up demand, hence production, hence production being developed, and eventually getting cheaper.
d) improve US products, and prices, so that they compete in price to the import - or at least fall inside the margins such that a) becomes effective. c) can help bridge the gap here until the US companies have caught up.
In the long run, not all these strategies win. If you go the tariff route, then it's hard to undo it later. Local products fall behind, and the harder it becomes to catch up. Not impossible, but hard.
If Ford wanted tarrifs to help boost EV demand, and so allow Ford to build out infrastructure and lower costs, then fine. But it seems it's more of a short term play to just keep ICE Fords selling in the short term.
This is one of those "the internet is a fad, it'll never catch on" moments. EV's are here to stay. They're going to win. That's pretty obvious to anyone paying attention. If the question is "how to maintain the US car production" then they should be all-in on EV development now. It seems to me though that the current strategy seems to be very short term thinking - trying to just hold back the tide.
What’s interesting is that while most cars imported into Mexico (except for those from the NAFTA region) face stiff tariffs or outright bans (if you move to Mexico from the US you can only bring your car if it was manufactured in Mexico/Canada/US, other cars are not allowed at all), but electric cars have no tariff at all which means that, e.g., Chinese EVs are widely available there. The BYD Seal sells for MXN888000 in its AWD/big battery configuration which translates to USD51,184¹ which is comparable to the Tesla Model 3 price in Mexico (and a bit lower than the equivalent price in the US). Mexico is going at the EV transition with a two-pronged strategy: Building a domestic industry and encouraging imports at the same time. This seems to be the exact opposite of the US strategy.
⸻
1. Worth noting two key differences between the Mexican and American car buying experience: First, prices are fixed. There’s none of this negotiating with the dealer about the price or upselling you on undercoating stuff. You can look on the website and know what the price is. Second, instead of sales tax, Mexico uses VAT to achieve the same purpose. As a result, the price you see for a product is going to be the actual price you pay walking out the door and not the price before sales tax (at my current residence, the total sales tax is currently 10%). As a consequence, some things that might appear to be slightly more expensive in Mexico, depending on where you live, may actually be slightly cheaper.
The US didn't go from #1 in global auto manufacturing to nearing extinction on accident. The companies shifted production abroad because they didn't want to pay for US labor. We can't just pray for "development" to spark a chain reaction that gets us back on track - we were the most developed and consciously chose to squander that advantage.
Onshoring can be done, but it will have a real cost someone will have to bear. The industry would prefer consumers just pay twice as much for cars, meanwhile consumers are at a breaking point like they've never felt. In the meantime there's a stalemate and nobody can move, as the decline continues.
Comparing with China, I’d be curious about whether their companies face the same return-on-capital forces that US (and to a lesser extent western) companies do. So when we outsource to them, it’s to a vendor who is not needing to promised 10%+ returns. As I understand it, this is because the central government exerts pressure on banks to make loans at low rates, so that capital can be raised more easily for targeted industries.
I agree that onshoring is likely impossible without some sort of contextual reimagining of US industry.
> The companies shifted production abroad because they didn't want to pay for US labor
Realistically it’s the consumers who didn’t want to pay for it
Also US cars were genuinely horrendous in the 80s-90s in terms of build quality & reliability vs same price or cheaper Japanese equivalents.
It's only rather recent that all the big name car makes from US/Europe/Japan/Korea are pretty good & reliable. There were huge differences 30-40 years ago.
I think there's a finer point here: US consumers don't want to pay for local UAW labor. GM&Toyota did fine out of the NUMMI plant, and companies like Nissan and Mercedes are making cars in Alabama.
Parallel to how the UK car industry local brands collapsed, but Nissan Sunderland has just kept going nicely.
The problem wasn't assembly alone, the designers carry much blame as well in that era.
Customers will always aim for the best quality/price combination that they can get though.
By accident. (Good)
On purpose. (Good)
An accident. (Good)
On accident. (Bad)
> The companies shifted production abroad because they didn't want to pay for US labor.
That's not true. Reality is far more nuanced than that. Sadly, it is the equivalent of a bunch of Dodo birds falling off a cliff. And this applies to every industry, not just automobiles.
The simplified version goes something like this:
Three companies manufacture forks and knives in the US. They share the market equally. Each has 1/3 market share.
One of them decides they can be clever, manufacture in China, reduce the price of their products and get more than 1/3 share.
Their plan succeeds. Their market share goes up to 1/2 and the other two companies down to 1/4 each
Try as they might to compete, they cannot, the cost basis in the US is higher.
One of them decides "We can be just as clever" and they start manufacturing in China.
Now two of the companies, on account of their lower prices, have 2/5 of the market each. The third company is down to 1/5 share.
The last company has no choice at all, they have to manufacture in China or shut their doors.
With all three companies manufacturing in China, we are now back to each having 1/3 of the market again. Except that, due to the price war, they are now selling the same product they were selling before the transition for half the price. And, of course, their margins are no better, maybe even worse.
And now, the grand finale: The industrial development all three companies effectively funded in China has taught one or more factories how to make these products. Now the Chinese companies enter the market directly, compete with their customers and drop the prices even more. All three companies go out of business. One of the companies is acquired in bankruptcy by one of the Chinese factories who sell the same product for less under the same brand.
Ironically, the reason (one of them) consumers are at the breaking point is because this chain reaction --which required consumers to prefer cheaper goods from abroad-- managed to destroy untold number of industries everywhere. This destroyed jobs by the millions. And here we are.
In some ways this is no different from the race for higher minimum wage. The huge sucking sound you are hearing are the millions of jobs that are being lost because of it.
.. and the consumers get cheaper goods.
This debate is as old as Adam Smith, or older. I think the examples he used were centered around textiles? Everyone was afraid of the new job-destroying looms.
> This destroyed jobs by the millions. And here we are.
US unemployment has been about 5% for a while. If you look back on the graph: https://www.bls.gov/charts/employment-situation/civilian-une... , there are two big outliers. One is the business cycle disaster of 2008, which blew up the property market. One is COVID.
Unemployment is basically a managed number. It can't go too far below 4% before inflation kicks in, which everyone absolutely hates, so interest rates are raised to reduce investment and consumption and thereby increase unemployment and reduce wage pressure. All of this is orthodox economics.
How is this not a longer way of saying companies didn’t want to pay for American labour?
Tarfis seem to be the only way out.
Everyone laughed when Trump did it, now EU is doing the same.
Everyone laughed at Trump because what he did was stupid. Selective tariffs have always made sense in certain contexts and have never been controversial.
The tariff route is what happened in the 1970s under the "chicken tax", which still exists today to protect the US light truck industry, and is pretty much the reason why SUVs reign supreme in the US market. SUVs are classified as "light trucks", which has caused a Galapagozation of the US car industry/market.
I see this take on SUVs all the time, and I can't help but think it's wrong. Americans just like bigger vehicles and will downsize if gas gets too expensive. There's a reason almost all electric car companies start off with a CUV/SUV/truck, and it's not because they're allergic to sedans or coupes.
- Tesla, the most prominent and successful EV company, didn’t start with a truck.
- Neither did all the attempts at EVs from other competitors in the 2010s, like the GM Bolt/Volt or the Nissan Leaf.
- But you’re not wrong, that today EV companies usually start with SUVs/CUVs, but that’s because a larger chassis makes it easier to include a large enough battery.
Back in the 2010s, EVs were primarily sold to customers that were more likely to be averse to SUVs for the perceived environmental impact and, frankly, snobbery (liberals of the time used to mock big SUVs like the Cadillac Escalade and the Hummer, particularly after they got associated with the timespan of the Bush administration before becoming uneconomical after the late 2000s oil price spike). Also the batteries just didn't have enough capacity at a reasonable price to build anything heavier than a sedan.
As soon as it was feasible, Tesla released a CUV (the Model Y) which now outsells the Model 3 almost 2-to-1. Arguably Tesla has fumbled by letting Elon pursue the Cybertruck rather than a full-sized SUV or normal pickup truck. You can observe that Rivian went after precisely those missing models.
They're mostly CUVs and above because fitting sedan seating into a CUV-shaped body frees up the height you need for a battery. Western OEM batteries were usually tall because they mostly used large-format pouch cells, because that promised the highest performance and lowest cost (spoiler: recalls are expensive).
There is a market for smaller cars and trucks but its probably smaller than for other countries. We don't have the smaller roads/spaces associated with e.g. Europe. But for sure I would buy small cars or trucks first any day compared to the monsters on the road; there are few options though.
The SUV branding is ridiculous. The Fiat 600 brands itself as "SUV" to appeal to this sector. It's basically a hatchback with a slightly elevated driving position. In a few years all cars will be called "SUV", and then sub-distinctions like "compact SUV" and "hatchback SUV" will be re-introduced.
Idk if I'd say that Americans like bigger vehicles. There are just a lot of incentives that push us that way.
There may be another option.
Consider Japan's Kei car initiative, for example.
https://en.wikipedia.org/wiki/Kei_car#Description
https://en.wikipedia.org/wiki/Kei_car#Taxation_and_insurance
One route is to provide incentives, if not regulations, to force innovation on US automakers. The goal would be to yield products that are head-to-head competitive with imports.
> It seems to me though that the current strategy seems to be very short term thinking - trying to just hold back the tide.
I'm seeing that too, but from a different angle. The era of big trucks seems to be as much an effort to extract cash from the economy as it is taking advantage of a peculiar set of EPA and DOT regulations. Basically, "gettin' in while the gettin's good." It's not a long-term strategy because, at some point, people can't afford these behemoths and will go for the used car market next for cheaper goods. EVs may get caught up in that too, considering that they're aimed squarely at the sub-luxury tier and above. As we have no good cheap EV options at the moment, I think it's the same story.
The main difference between a car like this and a kei car is the ability to drive it, at least for a short while, on the expressway. If this could go a couple miles at 45 or 50 mph that would work in lot more situations where two neighborhoods or urban areas are connected by a short stretch of highway.
Kei cars can comfortably go up to about 60mph. Not great for an 8 hour drive, but I regularly do 3-hour-drives with a loaded kei-van. Yep, same 660cc three-cylinder engine that those kei-trucks have. It'll hit 70mph, but not comfortably. 50mph is easy.
And on the highway, I see tons of other kei cars, too. Light weight class cars even get a toll discount!
> The Ford CEO is not wrong. Allowing foreign imports into the country at prices far below what US producers are able to make will decimate the local car industry in the US.
The local car industry in the US is doing that to itself by dragging its feet on EVs in the US market even when the very same companies are selling EVs outside of the US. Ford, for example, has an EV Bronco that's inexplicably only available in China; that'd sell like gangbusters here in the US, but Ford won't sell it here because reasons.
In that sense, the Ford CEO is about as dead-wrong as it gets. His company needs to either actually sell competitive products or else move out of the way for other companies to do so. His demands to keep foreign competitors out of the very US market in which his company refuses to offer products are downright insultingly greedy.
I’m interested in understanding more about what gives you the impression “that [an EV Bronco would] sell like gangbusters here in the US”.
I see non-EV Broncos everywhere here in Reno, and I also see EVs everywhere here in Reno. I would therefore expect to see EV Broncos everywhere here in Reno if they existed in the US market.
I also in particular see Cybertrucks and Rivian R1Ts everywhere here in Reno, so the very specific demand for electric pickup trucks clearly exists.
Not GP, but for starters, the MSRP for that car in China is $32k.
https://www.carsdb.com/en/news/1476
I get that's an apples-to-oranges comparison, considering that labor and material costs (not to mention subsidies and regulations) are probably not the same. But even at $40k, it would be cost-competitive with other EVs if nothing else.
Isn’t there a e) have investment at the federal level in R&D, specifically for industries that matter (economy, national security etc)? For automotive, China didn’t become the EV leader by accident. It was a deliberate national strategy, with funding to back it up. Yes there is cheaper labor, different regulations etc. But also in no small part to federal funding, investment in R&D etc. why are we surprised then that the US is in general falling behind?
The US could invest more in battery tech, manufacturing automation, robotics etc. This both lowers cost and increases product competitiveness.
> The US could invest more in battery tech, manufacturing automation, robotics etc
The US is investing in batteries. Domestic production has increased rapidly over the last couple of years and is continuing to do so. The US can now produce domestically all of its battery needs for grid storage, for example.
This is due to government incentives from the Inflation Reduction Act.
There should be a time limit to protectionism and a scale where tariffs on imports come down overtime. Otherwise you will get what you currently have in the US ie huge cars that cost a lot of money to make and run. US supposedly the free economy is the country where almost every industry is an entrenched virtual monopoly or a duopoly and with it's political finance system they are eating into every industry.
Its an inevitable state of any market system (especially if regulated). Eventually it will become more profitable to use the gains of capital to buy protection from regulators, instead of investing in ever smaller business improvements. Using money to defeat competition is ultimately inefficient and generates lower returns for investment. Unless regulators are totally insulated from the market, they will have a stake in selecting winners and will eventually construct moats that others can't cross, as that provides the highest returns to capital, and the greatest rewards to regulators.
Monopoly is the most market-efficient vehicle to deliver returns to capital, and the most natural state of the market; one player using advantages and gains eventually destroys all opponents. Smaller players can never gain a foothold due to the incumbents being so efficient and far ahead, and it makes more sense to merge with the front-runner, allies, or be destroyed (hence the competitor pool keeps shrinking).
These are features of the system that naturally emerge without counterveiling forces.
For example, AI companies will shortly find its cheaper to just get the government to constrain their competition. The alternative is many companies spending trillions to eek out profits, a poor state to be in. Regulators want money and power, so its in their interest to create this protected state, as the "free and open market" isn't buying elections or vacation homes. And of course, any unprotected competitors left behind will die, consolidate, or sell to the victors; so we will eventually have a "winner takes all" system where one or two big players dominate. Any startups will either be quickly destroyed as people ask "why use a worse product", or will sell to the monopoly when they realize they can't afford to spend $1T training models and building data centers, and complying with all the regulations.
My point is that protectionism (in any form) isn't something to bring down over time to encourage competition -- the system can't naturally function that way, as it would require each player to go against their own interests. Instead, protectionism is a natural ever-increasing good that will be cultivated for the controlling capital and regulators in the system. We only see the "free market" operations during a time before market / regulator capture, as that's the time when there aren't yet dominant players who can guarantee power and money to the regulators, and there isn't enough consolidation of capital to immediately destroy all competition, but its an unstable market state.
Why is decimating our local car industry a problem? Why not build something else with the resources if cars are now a cheap commodity?
This reminds me of a quote from Peter Schiff, circa 2008 housing crash. To paraphrase,
“too-big-to-fail eventually becomes too-big-to keep alive"
historically car manufacturing gets redirected into defense for wartime though it's unclear how that would pan out with today's factory specialization
Historically being WW2. I'm not sure they've contributed much to the "war effort" since then.
A legacy of WW2 was the explosion of the whole defence industry. While a lot of the civilian factories got repurposed in WW2 to build trucks and planes and ships, the tech in all that stuff was very basic. For example the aircraft carrier Yorktown was "fixed" (at least good enough for the Midway battle) in 3 days. I somehow doubt a modern carrier could do that, simply because of the tech required. The US built 150 more carriers in the next 3 years.
The defense industry today gets a trillion $ a year. There's no civilian ship-building to speak of, and military vehicles are now highly specialized.
So why keep Ford et al afloat? Politically it's sold as "national security." In reality it's like more "they didn't die on my watch." And of course, having the ability to make local affects the supply chain. [1]
For example if China invades Taiwan, the US loses pretty much all electronics- especially PCs and Phones. That's a lot of leverage for a foreign country to have.
[1] US cars aren't really local - that's a fiction exposed by the proposed tarif on "car parts", which the industry squashed. In reality car parts are made all over the place (including the US) , and then assembled in the US (or anywhere else.)
Mercedes Benz and other car companies in Europe are going into defence directly as EU is investing more so any company in the engineering space see potential new market growth
https://www.cnbc.com/2026/06/11/mercedes-benz-anti-drone-veh...
You can't really assume the prices will stay low forever and removing local competition exposes you to supply chain issues.
Our local car industry is tightly related to our local military vehicle industry.
Should we get into a big war, we'll likely need mass production of military vehicles and having mass production of consumer vehicles is a good start.
> Should we get into a big war, we'll likely need mass production of military vehicles and having mass production of consumer vehicles is a good start.
And all those military vehicles we build will be destroyed by tiny fpv drones that cost a tiny percent of what the vehicles cost.
Why do people cling to this WW II era idea that we need car factories in case we go to war?
Those tiny fpv drones pack a tiny punch. Sure, it will destroy a current generation Chevy Equinox. But two weeks after the war starts, countermeasures will be created. The vehicles will be changed to make them harder to find, and harder to kill. A small drone will be rendered ineffective by small countermeasures. As much as I dislike the current US administration, Ford moving to making missiles and other military hardware is a good idea. They sure can't build a cost effective vehicle; yet there is a lot more potential profit in a Standard Missile, not to mention less competition.
> But two weeks after the war starts, countermeasures will be created. The vehicles will be changed to make them harder to find, and harder to kill. A small drone will be rendered ineffective by small countermeasures
Where did you get this?
Nobody solved FPV's in four years, why do you think US or any other country will solve it in two weeks?
"small drone will be rendered ineffective by small countermeasures" – only a person that lives under a rock and doesn't follow RU-UA war in any way can say such things.
Not solved. Made less effective. So it takes 100 of them to make any military effect.
The thousands and thousands of FPV drones being used have not been decisive on the battlefield.
The war is a slog, and resembles WWI more than WWII.
You don't know what you're talking about.
Gotta move infantry some how. If they're being destroyed all the time, gotta build new stuff.
Last world war, a lot of the mass production facilities got pushed into building munitions too. Harder to do that without manufacturing facilities.
It's truly shocking that westerners still believe in fancy military megafauna.
> c) subsidize local production out of the "national interest to support this industry" budget. This has the effect of ramping up demand, hence production, hence production being developed, and eventually getting cheaper.
We already have a trillionaire from subsidizing local production.
Where do interest rates factor in to your calculus? We've just had really cheap money for a really long time in the US and the car makers seem to have adapted and found ways to sell vehicles for more. A top of the line raptor has a tremendous amount of power and interior amenities. Oddly, they're not uncommon, I see landscapers driving them around. Maybe not the very top line Raptors, but I do see Raptors and that seems like an awful lot of truck to pull some lawnmowers and sprinkler parts around in. Low-interest financing and then we've never had high gas prices for terribly extended periods of time.
I don't know that I think the US manufacturers have taken "inexpensive, but good value" cars seriously for decades. The least expensive Ford vehicle, I think is a Maverick which starts around $28k, Hyundai, Kia, Toyota, Mazda and Honda all have cars under $25000.
Like many things, it seems like a combination of all of those would work better than any single one, depending on the actual goal. If the goal is to help drive EV adoption, tariffs that raise foreign prices to the desired price point, rather than simply being more expensive, would provide competition to the America companies, perhaps driving improvements. Subsidies would help with labor and ensure the company keeps driving the right direction. Improvements to products can help sell "American made" as a good thing.
Part of the point of historical import taxes/tariffs was to get them to build it here, invest in facilities, train the local workforce, etc.
But is "it" in this context EV's or just protecting ICE production? That's the real heart of the issue.
Building EVs would seem to be a logical goal. But is that what the policies are promoting?
Before deciding on a solution, Governments also need to decide on what problem they are solving. Why do they want to protect domestic automakers specifically?
Is it national defense synergy / surge capacity reasons? Is it general manufacturing know how / impact on overall domestic manufacturing supply chain? Is it jobs for current workers? Is it to keep the pensions solvent for retirees?
I saw a comment re: this issue in Europe where a Portuguese commenter asked why it was fine for the Eurocrats (lead by Germany) to let all their apparel jobs go overseas, but now he doesn't get the option of buying a Chinese car because German auto jobs need protection. There is something of a point there.
(Is "foreign imports" redundant?)
I'd be OK with tariffs if they are not meant to simply keep foreign car companies out of the US, but rather to encourage foreign car companies that want to enter the US market to build factories in the US and build their cars here with US labor.
There would probably still have to be tariffs on parts so they can't just ship all the parts here and just assemble in the US, but if they come here and build cars with US labor and with much of the supply chain being here too and are still causing headaches for the US car makers I don't see why American consumers should care.
Allowing foreign competition is a forcing function to be more productive and innovative. Japanese/German competition didn't annihilate US car industry, why would Chinese cars do it?
Cars are a way to signal status. Americans don't want to buy cheap cars, because cheap cars means low status. They'd rather go into significant debt and keep up with the Joneses. The people buying pickup trucks and SUVs are mostly picking up their kids from elementary school which is half a mile away.
Last time I looked at the total labor costs of producing a car in the US versus China or elsewhere and it was laughably small compared to the sale price.
Auto manufacturers did this to themselves thinking they could outsource all the heaviest labor portions and pocket the extra and that either the foreign labor would stay cheap and not foster the development of the industry in those countries or local labor would magically be ready whenever they needed despite being starved for decades. But they were wrong on both counts. And on top of all that they squandered all that extra profit they made so they can't seemingly afford to drop the capital needed to return to the cheaper high-volume low-margin market, atleast not with the massive managerial burden they have built up and sustained.
This seems to fill a useful niche, but may be too downscale. Remember the Tata Nano.[1] Tata built a basic car with a price below 1 lahk, but it didn't sell.
In the US, there's Slate, which claims to be making a small electric pickup truck. "Preorders will start on June 24, 2026. First deliveries are slated for late 2026." [2] Price in the US$20K range, they claim. Claimed range is 150m with the base model battery. A larger battery is available. It's America's answer to the kei car. If it ships and keeps shipping.
Detroit got way too much into the "more car per car" thing. Chevrolet once had the slogan "basic transportation". They lost sight of that market. The giant pickups are just silly.
[1] https://en.wikipedia.org/wiki/Tata_Nano
[2] https://www.slate.auto/en
> Claimed range is 150m with the base model battery.
Surely 150km
Sorry, 150 miles. Not km, Slate is a US company.
The abbreviation for miles is mi.
Are we just ignoring data now? Giant pickups have silly sales- silly in the crazy high sense of the word. I love my EV but I have never wished for less range. The Slate is a toy for the wealthy, like kitted up Jeeps that have snorkels
If it shows up in the suggested price range, it's going to one of the least expensive new vehicles on the market.
Yes, it has less utility than many other vehicles in many ways, but the bed length (5 ft) is longer than a lot of trucks I see on the road which enables carrying certain kinds of loads that aren't easy in cars or trucks with very short beds as seems fashionable now.
150 miles isn't a ton of range, but it's 50% more than a first generation Leaf and those sold.
The Slate clearly isn't trying to check all the boxes, but every vehicle doesn't need to try to do everything.
Bed length is a silly metric to use. It's single dimensional and doesn't capture any of the other important metrics. Such as width, air-volume, cubed-volume, or weight capacity.
Slate's 5 foot bed is on the shorter end of common bed sizes. Certainly shorter and worse on every other metric than the F-150/Silverado/1500 'short bed' so commonly seen hauling air in the US.
Giant pickups have silly sales because pickups in general have silly sales and there are basically zero non-giant options in the US market (thanks, Chicken Tax, very cool).
The Slate would be the absolute perfect truck for me if it had a 4WD option. Being RWD-only is the only thing making me unwilling to replace my Tacoma with it.
How often do you off-road and need 4WD? I have a Jeep Wrangler, and in winter I have to go up a muddy hill with about a 15% grade to a back pasture at a stable. I sometimes engage 4WD (high) for that, but I don't really have to.
Very few of the giant pickups I see have mud on them.
> How often do you off-road and need 4WD?
These are two separate questions.
I off-road an average of once a month, specifically to reach my usual shooting spot on BLM-maintained land. I don't necessarily need 4WD for that, but it's a good excuse to turn it on anyway.
I “need” 4WD when it snows, since 4WD/AWD + snow tires = not being required to chain up when chain controls are in effect, and because 4WD > AWD > FWD > RWD when it comes to snow driving (especially here in Reno/Tahoe, where the snow/ice happens on hills and having more drive wheels is a strict improvement over fewer).
> This is one of those "the internet is a fad, it'll never catch on" moments. EV's are here to stay. They're going to win. That's pretty obvious to anyone paying attention.
That's not clear at all from the long-term habits of American consumers. Why did Ford, GM, and Stellantis all cut EV investment and increase ICE investment in the last year then?
Short term buyer habits don't necessarily track technological progress - they tend to be resistent, then inertia is broken and consumers buy en-mass. Companies need to brunt to cost of innovation until the cost benefit analysis makes sense for consumers. Mobile phones were a passing fad for niche power users until companies threw so much money at them so they weren't, and we became reliant on carrying one. Same can be said for thousands of other products. Nobody used them until suddenly we all were.
We're seeing a moores-law-like improvement in electric cars and their power densities. If the American car manufacturers don't want to be a part of that progress, it's on them, but Asia and Europe will continue to innovate in that area and the US will be playing catch up because they're servicing what consumers want now, not what they will probably want in the future.
Because they are focused on short term returns, not long-term strategy.
In the short term cutting r&d, killing off "not yet profitable" lines etc all lead to improved results this quarter. Who cares about 5 years, or 10 years from now?
If you look beyond the US then you see EV market share growing year on year. Yes, the US is resisting hard, but you can't hold back the tide forever.
Kodak invented digital photography, but kept going with film. In the end the world moved on, even if they didn't.
50 years from now ICE will be a niche market. And if US producers want to own that niche, well that's great. But it'll be a tiny fraction of what they are now.
> 50 years from now ICE will be a niche market
EVs are roughly at two thirds market share in the largest car market of the world. The third largest market has them at 20%. Funnily enough, India (4th largest market) is slightly ahead of the US for EV adoption in passenger cars.
ICE cars will be a niche market much more rapidly than 50 years.
The US is again exceptional insofar that it is actively pivoting to become a petrostate. Even petrostates have been trying for a while to not be petrostates any more, which could be telling for the US electorate but isn't.
Industry famously never makes mistakes due to short term thinking.
5) Force outside companies to partner with local companies in join ventures with IP and knowledge sharing. This strategy seems to work remarkably well when you have a captive market others want to break into.
I think the idea of public transport or rather functional public transport is completely omitted in that context of this country, isn't it? That alone can be a huge local competition as there should be.
Eu tariffs have had a different effect - Chinese companies are signing deals with European car makers to make the cars at their existing eu factories.
Stellantis is in talks for the Chinese to invest in them too.
A lot of the underlying EV technology is military applicable too
The playbook to study is South Korea. Protectionism and subsidies for nascent and transitioning industries with a clear ex ante timeline to full liberalization to force international competitiveness. Absent the latter, American car companies’ inefficiencies in design and labour structure have zero incentive to change, and American consumers get stuck with shitty, expensive products.
For cars, this would mean federally-guaranteed loans up to the median value of a plant for any manufacturer with any production base worldwide (the plant to be built or retrofitted in America, of course) plus an N-year (N set to the expected payback period for a new or retrofitted plant) tariff schedule starting very high before decreasing to virtually zero. Maybe also pass a special bankruptcy regime to expedite the redistribution of assets for those who fail to really send the message that failure is an option.
I feel like the "clear ex ante timeline" is a big problem for us in the US. A prominent feature of US politics (and indeed culture) is constantly setting such targets and then chickening out and moving the target back as the time approaches. That in turn creates a sort of moral hazard where no one feels an urgency to meet deadlines because they know they'll be loosened up later.
> A prominent feature of US politics (and indeed culture) is constantly setting such targets and then chickening out and moving the target back as the time approaches.
I'm not an American, so I want to check with this: this is normal for the broader culture? Not just Musk?
Musk is an extreme case but the general pattern is pretty common. See for instance rules passed in various jurisdictions to the effect of "a budget must be passed by date X", which then is circumvented via loopholes or changing the law so that deadline no longer applies.
Hmm, maybe a carrot with liberalization? Tax benefits to the car companies come to mind. But I’m almost more of a fan of creating a monetary incentive for the lenders with the federal guarantees—if the liberalization gets delayed or derailed, they lose money.
None of these strategies seem to address the other technological issue hiding beneath the surface, which is that EVs are fundamentally simpler (electric vs combustion motor) and hence should be cheaper than ICE cars when manufacturing pipelines are mature. This would result in lower profits across the car industry even in the absence of international competition. No US manufacturer so far has actually tried to build EVs cheaper than gas cars at scale (Tesla made a little noise and then got distracted), while Chinese manufacturers have no need to worry about cannibalizing the comparatively small domestic ICE market.
Letting the industry guide policymaking seems like it could lead to regulatory capture preventing EVs from reaching the (low!) price points that they should reach. Already the two-track emissions standards and chicken tax make cars too big and the "arms race" of having a bigger car than everyone else to stay safe (at the expense of others) prevents meaningful reform.
The "secret sauce" of being an OEM is integrating a good set of properties that sells at a price point that sells.
Yeah, they have a lot of $$ historically invested in good engines but they don't care that much. They'll buy engines from each other whenever they want. They don't see it as a critical moat.
One might wonder why the Ford CEO cares about low cost foreign cars when Ford doesn't even make any. They have shifted all of their lineup except one car model to higher- margin compact SUVs, SUVs, pickups, and full size commercial vans. And that one car, the mustang, another one marketing exercise on four wheels with accompanying margin markup - not exactly a practical entry level car.
Oh, but the poors but the used cars and competition for their business will lead to greater supply of used cars, diminishing the resale value they can point to to justify purchase of their high-margin vehicles. Can't have that now.
Tariff is probably the easiest path forward.
You'll need to pay workers more to make D) work. That cuts into margins. That means it's DOA.
GM has had like what, 1.5% net profit in 2025?
It wouldn't matter if it was 50%. Shareholders have the expectation of the number getting bigger every 90 days in perpetuity. If you want better vehicles to increase sales and compete better against international competition, you need to have the rank-and-file feeling like their work will matter not just for the company, but for them too. That's diametrically opposed to the number getting bigger.
5th possible solution:
e) End the socialism that is taxpayer-funded bailouts and subsidies for failing car companies, and let the free market decide.
Tired of paying for their losses.
>This is one of those "the internet is a fad, it'll never catch on" moments. EV's are here to stay.
Not saying you're one of them (there are other people here who fit the bill much better) but like with anything else the people on the internet peddling grand narratives lacking of nuance are delusional fanboys, malevolent liars or some combination of the two. EVs are absolutely going to win certain market segments and take good chunks out of others. Unless the government gets out of the business of regulating the crap out of electrical infrastructure at great cost to us all there will likely be a whole bunch of heavier use cases where they just can't pencil out barring some yet unforeseeable breakthrough in the basic physics of batteries.
I think the auto industry is wise to think about the upcoming ~30yr transition period where all that shakes itself out and how to invest the right amount into keeping ICE stuff competitive but without investing to the detriment of winning the EV segment, etc, etc, standard big business stuff.
ICE -> EV is not a 30 year transition.
I’d be surprised if there’s a consequential ICE industry after 2040 (that doesn’t mean there won’t be ICE cars being driven, just that they won’t be selling outside niche industries after 2040).
The collapse of ICE vehicles will happen sooner rather than later due to a few fundamental reasons.
- China has gone all in on EVs. It’s hard to compete against the Chinese and they’re unlikely to ever develop the skills and capabilities to develop cheap ICE vehicles.
- The Strait of Hormuz fiasco has pretty much convinced countries about not being dependent on gas. Electricity is an energy abstraction. It allows you to run your EV no matter where you get your energy from because almost all sources of energy can easily be converted to electricity. Running your vehicles on this abstraction provides a lot of sovereign flexibility.
- ICE infrastructure is incredibly expensive to maintain. You have so many dedicated gas stations spread out all over that use up valuable space and resources, but also then need to be supplied with gas coming from all over the world. As EVs take meaningful share from ICE vehicles, the cost of maintaining this infrastructure for each ICE vehicle driver will keep rising. As demand goes down, gas stations will start shutting down, and then the distance between 2 gas stations or your home and thr closes fast station may increase, and range anxiety will start working against ICE and in favor of EVs.
- ICE vehicles are 100+ years into their development. EVs are just getting started. And they’re almost close to parity. It’s not clear how ICE will maintain any edge outside of very niche use cases as EVs continue to improve.
> ICE -> EV is not a 30 year transition
> I’d be surprised if there’s a consequential ICE industry after 2040
It started in the 00s, really took off around 2010.
And don't forget that 2040 is in 14 years. You can buy plenty of brand new ICE cars today, the majority of them will definitely still be around in 14 years.
I agree with you, for the mass consumer car market (individual/family transport) as a whole. It's coming fast. However, the current EV technology (mostly batteries + charging) is not a good fit for a whole lot of edge cases, and in the aggregate they matter, too, and thus the ICE engine industry won't really go away anytime soon:
* General-purpose Semis for commercial hauling. Yes, there's some EV Semis on the road today - pilot projects, or specific routes on specific schedules. But there's a lot of general purpose semi-hauling that happens every day on odd/long routes without sufficient chargers in the right places, and they need much bigger chargers. And then there's the specialty semis that carry large/wide loads. I see them almost every day in my area, carrying large chunks of power substations, heavy manufacturing equipment, blades for wind turbines, etc.
* Fire trucks, Ambulances, Tow trucks, Police cars - For various similar reasons, it's tricky with some of these, although in well-constrained cases and with extra vehicles on tap as backup (when the other one is low on charge in an emergency), maybe can kinda work, eventually.
* "Personal" trucks that see heavy towing/hauling use (think: hauling a livestock trailer or farm equipment or heavy materials (or maybe an EV race car!), possibly long distances on a regular basis). The battery range really suffers when you put all the extra weight and drag on by towing, and people aren't willing to turn what was a 5 hour diesel trip into a 9 hour trip with supercharger stops (more time in the heat with animals, more time on the road in general, and do you have to disconnect the trailer just to reach the charge cable?)
* Backup generator ICE engines - home, datacenter, industrial use, etc. The problem here is mostly runtime and peak watts of output vs cost. You can use a battery-based solution for most of these cases, but it currently costs prohibitively more for the same performance specs. When they're being used in austere environments, sometimes there's no electric grid to even charge from, so slap on a massive solar array cost, too.
* All military use of ICE engines in general (transport, generators, etc) - Not insignificant in scope and scale, and obviously they're not going to run EVs or find chargers on battlefields.
These cases will diminish over time, especially as we continue to make advances in charging and especially battery technology, but it will probably take a few decades because there's science challenges, not just engineering ones. The military case might never go away.
ICE cars/vehicles aren't going to disappear overnight. There are enough used ICE vehicles for ALL of the edge cases and a ton more for the next 20 years. There is no need to buy new ICE vehicles.
Look, sure. No one is saying "no ICE ever". Some people still ride horses.
125 years ago cities were built around horses. Stabling. Breeding. Feeding. Grooming. Street cleaning (turns our horses poop a Lot). By 20 years later that's all gone.
Sure horses survived in rural areas. Sure the Amish use them today as then. But the horse-based industry has (in real terms) vanished.
ICE is headed the same way. It will exist, but no daily-driver car will be ICE. EVs win, because in cities they are better. Because they're cheaper to own.
If Ford wants to own the ICE niches, fine. But it won't be cars.
It's not quite that simple though. A lot of these edge cases are necessary for everyone to live their cushy little city lives. It's not a matter of outmoded things. We will still need ambulances, and we will still need livestock trailers, and everything else on my list, for all of the foreseeable future. Unless batteries and charging gets a lot better, we'll still be manufacturing and improving ICE engines for many applications. Just not simple passenger cars.
> there will likely be a whole bunch of heavier use cases where [EVs] just can't pencil out
Do the big Detroit automakers also build a lot of semis, garbage trucks, snow plows, and fire engines? I can see those types of vehicles being ICE holdouts. But certainly not anything you can drive with a regular driver license.
I’d argue that garbage trucks, snow plows and fire engines are candidates for EVs. They are large and heavy with plenty of space for batteries. Typically used in predefined routes, traveling less than 100 miles per day.
I would gladly vote for a bond to fund electric trash trucks if that resulted in quieter weekly trash service.
More than half of the garbage trucks I see in Copenhagen are EVs. The first was introduced in 2022.
https://www.volvotrucks.com/en-en/news-stories/stories/2025/...
I haven't seen a fire truck EV, but those exist in other cities.
And they are so much nicer. Way less noise and pollution and much better maneuverability on narrow streets or on slippery roads in winter.
I meant more like bog standard 1500-5500 sized trucks and vans. Depending upon the actual fine details of the use case it's gonna be hard to make the math math.
Your local DPW with a lot of money for new over spec'd trucks, friendly permitting office approving their permit for charging infra, strict 9-5, etc might make it pencil out for their facility maintenance. But a landscaper who's engaged in fundamentally the same work but out of rented space, a landlord that won't get preferential treatment on the install of charging infra, won't qualify for the same fleet discount, works way harder than 9-5, etc, etc. might not make it pencil out.
Local delivery can potentially make great use of EVs, but if you turn up the operational tempo or the range and have drivers slip seating or really racking up the miles it can be a non-starter vs just buying the same thing in non-ev. And of course the fixed infrastructure cost questions still apply.
You might get hybrids but you also have to remember weight matters in a lot of these applications. Can't be rolling around over weight as part of normal business. And a lot of these applications are trying to stay under 10k while still having as much cargo capacity as possible.
The current Chevrolet Silverado EV has a 200 kWh battery option. Even with towing reducing the range to say 200 miles, you could do a lot of pickupy things with that.
Yes, it won't happen all at once. And some use cases will survive longer.
I'm not sure size is the qualifier though. Electric busses are becoming more and more common. I think city vehicles make good candidates for EV - they don't typically go far from home. They are cheaper to build and buy, and much cheaper to run.
The reason I think EVs win is because of the "support system" ICE vehicles need. And as ICE share decreases that support system also starts to dwindle. So those services get more expensive. I'm thinking gas stations, mechanics, parts and so on. It becomes a death spiral.
It's not unlike the switch from mainframes to PCs. At the beginning there wasn't a contest, but now mainframe skills are hard to find and hence very expensive. So the market for them goes down. Indeed most mainframe suppliers (DEC, SUN et al) died off ages ago.
> It remains to be seen whether the Olinia One will face similar pushback from the U.S. once it goes on sale.
> can travel up to 125 kilometers (77 miles) on a single charge
The US market generally rejects small-range EVs, except in very niche markets. In order to succeed in the US, it will need roughly 3-4x the range. In order for this to succeed in Mexico, their market will need different driving habits than the typical American.
(I know this as a former 2014 Leaf lessee. Short-range EVs only make sense when they are the only option in my price range, and I really, really want to drive an EV. Maybe the typical Mexican rarely drives far away from home? Or maybe this is for a niche of Mexicans who really, really want an EV and will tolerate a short range?)
I know absolutely nothing about Mexico in terms of geography or driving so I wonder how feasible an EV that you presumably constantly have to charge is going to fare. In the US, a range of 77 miles is a complete non starter. You'd have to charge it every single day. If not multiple times a day in some peoples cases.
It's interesting that info about the car is only half the article. The other half is a commentary on how US politicians are desperately trying to keep foreign EVs out of the country, lest it hurt corporate profits.
> In the US, a range of 77 miles is a complete non starter. You'd have to charge it every single day. If not multiple times a day in some peoples cases.
It's true that some people drive more than 77 miles per day. But a pretty big chunk of people never do, except road trips/vacations. It could easily be worth it to buy a cheap EV for everyday use and then rent a vehicle for long trips.
exactly - the rejection of short range EVs was when they cost as much as a normal car
if the short range EV is now much cheaper, people will adapt to the restriction because it's an affordable option
Yep, you can pick up used Leafs for super cheap (under $10k, sometimes substantially) and if they fit your use case, they're an amazing deal. Mostly helpful as a second car for a family, or as a city car for someone who never plans to road trip in it.
Would have to be very affordable. Like well under $10K. Otherwise I'll just buy a used ICE vehicle and have a lot more flexibility in how I use it.
Even Cargo Bicycles cost more than $10k. I think a 6 seater people mover is worth far more than those.
I'd buy a 6 seater with this range but not with the speed limitations (I think it is like 50-60 kph which is a non starter)
You can buy used ICE cars for $10k easy.
Like really really easy.
Apologies if I missed your point.
(2014 Leaf leaseholder here)
At the time we were a 2-car household and used the gas car for longer trips. That being said, there were a few times we had to scramble:
Once, when it was very cold my wife and I both needed to drive a long distance. I took the Leaf because I had access to a charger.
On our last year of the lease we ended up having to move 90 miles away. When we bought the Leaf, we never planned on driving that far. Due to circumstances, I had to make multiple 90-mile trips in the Leaf.
---
Case in point: I now only recommend that class of Leaf to people who need a 3rd car for a teenager and no intention of moving.
We considered getting a used Leaf but my wife had too much range anxiety, even for vehicles with 70 miles of range. I plotted out on a map how many trips she would have to take in a day (to work, to doctor, to pick up kid, to dentist, to store, etc.) in order to come even close to 70 miles. Of course, she never goes that far around town (only when visiting relatives, when I typically drive and we take a PHEV). But the RA was too great, so we got another PHEV. It has been useful at times to be able to both go 50+ miles in a day without any concern, but it's literally a handful of times over the years.
> (only when visiting relatives, when I typically drive and we take a PHEV). But the RA was too great, so we got another PHEV. It has been useful at times to be able to both go 50+ miles in a day without any concern
After the Leaf, we ended up with the Chrysler Pacifica PHEV and a Model 3. The PHEV had so many problems that I'll never recommend them, and dumped it early at a loss and went all-electric. (Both cars). We will never go back to gas.
IMO, the main thing EVs need in the US is a good publicity campaign, more chargers, and better legislation of chargers. The technology is now "good enough" if you have access to a charger where you park overnight, and "almost there" if you can't charge overnight. (IE, if you rely on street parking stick with gas.)
Sorry to hear about the lousy Pacifica. We have a friend who had a good experience with it, but one reason we never thought seriously about it is Chrysler's reputation for reliability.
I think you're right about the tech being "good enough" in many places, but it depends on weather (colder climates are not as good). I also know people who live in temperate climates that refuse to have their only car be an EV because of emergencies and power outages. As someone with two cars, I don't have that concern, but I can understand why someone (especially an older person) would not want to go all in on electric, if the grid is not super reliable (and would likely be offline in a natural disaster, when they would need to charge and possibly flee).
I live in the Northeast. The Leaf had problems with extreme cold, and my 2018 Model 3 lost a lot of range because it (surprise) had resistive heating.
My 2022 Model Y and 2026 Hyundai Ioniq 9 have heat pumps and generally work well in extreme cold. It's also nice that I can preheat them in the garage. Most importantly, they don't lose range overnight in extreme cold like the 2018 Model 3 did. I charge the cars before large storms, which is much easier than fighting traffic at the gas station!
It is weird point to be in. Almost a daily use of that range or significant part of it. As with less than daily use and short distances fuel is lot less critical. I am use case of going to shops a few times a week. Savings on fuel is not big thing as there isn't much used.
And then when I actually need to travel longer distances the range is much more important.
So EV would need to be very cheap to start making sense overall.
Or you own more than vehicle. Plenty of families own multiple vehicles, and they don't all need to have tons of range.
> Or you own more than vehicle. Plenty of families own multiple vehicles, and they don't all need to have tons of range.
I wish there still were small and very cheap EVs to fill this niche.
We had the Fiat 500e (somewhat infamous) $82 lease as an extra car because for $0 down and $82/month, why not. Range was small but it was perfect for around town, and had other cars for other things. Anytime I was driving within town I'd just take the Fiat.
At $8500, I could justify having a 77 mile range electric car with a top speed of 30ish mph. That would take care of every in-town trip, but I couldn't do a full commute to work with it because the most sensible way of doing that involves a highway. If it could manage 50mph for 15 minutes, it could go on the highway and I could recharge at or near the office.
The cheapest EV currently available in the US is the Chevy Bolt, at $29000, about three times the price. A Bolt has four times the range, but still not quite enough to go one way on my most frequent "long drive".
> The cheapest EV currently available in the US is the Chevy Bolt, at $29000
The interesting thing is that this appears to be largely because the manufacturers, rightly or wrongly, do not think that the US market _wants_ cheaper EVs. The id.Polo (about 20k with incentives in most countries) won't launch in the US, for instance, even though the id.4 did.
> The cheapest EV currently available in the US is the Chevy Bolt, at $29000, about three times the price.
You can also get used EVs/PHEVs. We got a PHEV with 20 miles of EV range for $14k, and you can get used Leafs for under $10k.
>but still not quite enough to go one way on my most frequent "long drive"
...without a charging stop.
> I know absolutely nothing about Mexico in terms of geography or driving so I wonder how feasible an EV that you presumably constantly have to charge is going to fare.
Hey at least you admitted that upfront. Average driving speed in Mexico City is 15 km/h so one would have to spend 8h driving to deplete the battery in a day. Typical commutes are perhaps 1h one-way but again, distance wise probably only about 40 km both ways. So this 125km range easily covers it for most people.
I think energy cost is more of an issue for most. electricity is expensive in Mexico City especially compared to base salaries. And electrical infrastructure was never built to handle high power consumption. Most apartments have a single 30A breaker for the entire house. Most heating is done by gas and air conditioning is not widely used. For most people charging speed will likely be limited to about 10A at 120V.
>charge it every single day.
That's pretty much standard operating procedure for any EV. That's one of the perks of owning an EV. Plug it in when you get home from work, and have a full "tank" every morning. Plus you get the cabin preheating using the wall electricity.
If you have a charger at home, or at work, why does it matter if you have to charge it daily or weekly? Yes, for some lifestyles, range matters. For others, a 125 km range is perfectly acceptable
For a significant segment of the US population, that thing wouldn't get them to work and back, so they'd have to charge it both at home and at work. And in many cases, forget running any errands, picking up kids from daycare, etc.
And minimum speed on US interstates is typically 40mph, so that reduces its usability even more.
> For a significant segment of the US population, that thing wouldn't get them to work and back, so they'd have to charge it both at home and at work.
What does 'significant' mean here? I find it hard to imagine that a _large_ number of people have a round-trip of like 100km to work; that would be horrendous.
Really? that's a bit over 30 miles each way. It doesn't sound at all unusual to me.
I don't think this car is designed for them, similar to how trucks are not designed for urban areas. Not every car has to cater to every demographic.
People move around: that's what cars are for. Trucks may not be "designed for urban areas" (whatever that means), but they certainly go into them on a daily basis.
28% of trips are under a mile, 52% under three, 64% under five, 79% under ten, 93% under twenty-five, and 98% under 50 miles.
Only 0.8% of the trips are over 100 miles!
> For a significant segment of the US population, that thing wouldn't get them to work and back
0.8% is not significant.
I think you wildly overestimate how many Americans are white-collar workers commuting 100 miles to a 6-figure job. A <$10k EV was never even remotely aiming at that market to begin with.
With a range of 77 miles, I wouldn't make it to work and back. Everyone I know (yes, it's anecdotal, but a widely-shared one) has to commute on roads where the average speed is well above 30mph.
This is a non-starter for the US.
> You'd have to charge it every single day. If not multiple times a day in some peoples cases.
Charging is not a problem when a car is stationary. It is parked next to a building, building usually has electricity (unless you are Amish).
I don't know why most people don't understand electricity is available everywhere, but petrol is only available at gas stations. You have to somewhere to pump gas, a major inconvenience.
28% of trips are under a mile, 52% under three, 64% under five, 79% under ten, 93% under twenty-five, and 98% under 50 miles.
This is the kind of misleading fact that motivated me to make my post. (Former 2014 Leaf leaseholder.)
Americans buy the car for the 1% trips. In my case, most of my car trips are short, but most of my milage is from long-range trips.
What's more informative is this post that explains Mexican driving behavior: https://news.ycombinator.com/item?id=48634740
> Americans buy the car for the 1% trips. In my case, most of my car trips are short, but most of my milage is from long-range trips.
How many of these long trips are you making? Depending on number might be more economical just to rent for that.
At least once a week. I commute 120 miles round trip one day a week, 180 miles 1-2 times a month, and 300+ miles 6-10 times a year.
I also have 3 kids, a dog, and don't live near a city. If I lived in a city dogless and childless something like Zipcar would make much more sense.
BTW: The "transaction cost" (time) of frequent car rentals is a non-starter. One of the things I hate about renting a car is that every time it's a different car, some I like, some I don't. I just want to pick out a car I like, have it ready when I need it, have it set up the way I like it, and have my "box of crap" in the trunk where I know where it is.
I don't want to navigate through a young ambitious salesperson trying to sell insurance, or the AI car scanner charging me hallucinated wear and tear.
This new EV is to replace motorcycles and scooters that are ubiquitous in mexico. If it succeeds in getting 100k people off of motorcycles it will have the side benefit of reducing healthcare costs treating motorcycle accidents.
People don't choose motorcycles and scooters because they like them, it's because they're cheaper than cars.
This EV is much more expensive than a motorcycle or a scooter, so on that regard it is DOA.
"The car is designed for urban settings and has a top speed of 50 kilometers (31 miles) per hour."
I don't think range will be an issue at that speed tbh.
Cool little transport but not really a "car" in the way we think of them.
> The car is designed for urban settings
Huh, the speed limit is odd because in my urban/city driving in the western US (San Diego, LA, SF, Portland and Seattle) all major cities still basically necessitate non-zero highway driving. Even mopeds (and bicycles) can pretty easily exceed 31 mph.
I've spent about 2 months total in Mexico City and there are still in-city areas where it'd be common to exceed 31 mph. The main rate limiter being traffic...
Anyway not to pooh-pooh the idea too much, I am sure there are plenty of use cases but maybe enabling a top speed of 55 mph would increase utility IMO
How many people do you know who can "easily" exceed 50 km/h on a bicycle?
They might be thinking of e-bikes that aren't regulated (at that point basically an electric motorcycle)
If not then maybe downhill....
An amusing coincidence: the maximum allowed speed in Nicaragua is 50 km/h If This wasn't about to countries in America, I would suspect something technical behind those decisions. The only thing I can think of is the loss of energy efficiency when driving over 60km/h
As with everything, finding an official announcement of something in Nicaragua might be horrible, so have this instead https://ni.usembassy.gov/message-for-u-s-citizens-new-speed-...
The limits on range and speed (reported 50kph) would make it a horrible deal for the average American.
150k pesos (~$8.6k) for a brand new wheelchair-accessible city van seems like a killer deal in the Mexican market. That would come on the market for less than a used air-cooled VW beetle (ended production in Mexico in 2003)
Can’t you get a much better used car for that? that’s probably one of the reasons why there is not much demand for basic cheap cars with no features in Western countries at least. Modern cars are much more reliable and last longer than they used to several decades ago and stripped down budget models can’t compete with that.
This car is explicitly intended as a taxi. If - and it's a big if - the taxi can charge while waiting for jobs, that's going to be fine.
Oh, huh, yeah, would have been helpful if the article mentioned that. Range is probably _fine_ in that case.
I was thinking it would make a good candidate for city taxis and other such urban uses
NYC taxis drive an average of 180 miles per shift[0] so they'd need to triple the range or have some sort of system where they can swap their depleted taxi for a freshly-charged one mid-shift.
[0] https://en.wikipedia.org/wiki/Taxis_of_New_York_City
Yeah taxis in the capital and small people movers to go from hotel to beach is where these will shine. EVs are especially well suited to stop and go traffic as well.
People are so caught up trying to solve every use case at once. Dropping pollution caused by old taxis in city centers will be a big win for Mexico if they can hit their price point. At the price they are quoting fleet operators can buy 2 and have their drivers swap out mid-day during their lunch.
> can travel up to 125 kilometers (77 miles) on a single charge
This would be a big hit in European cities. I own VW e-Up! and it's a perfect EU city car. With it's 375KM range, I rarely charge it more than once a month.
> The US market generally rejects small-range EVs, except in very niche markets. In order to succeed in the US, it will need roughly 3-4x the range
I mean, I assume it is not the case that literally all Americans regularly make long journeys. There probably is a market.
> I know this as a former 2014 Leaf lessee.
That was a lot more expensive than this.
The Dacia Spring has a range of a little less than twice these, and I see a good few of those around. Those cost about 15k EUR (17k USD). I'd definitely buy that there is at least _some_ market for something half the cost and half the range.
77 miles is nigh useless. Realistically that means you get 40 worry free miles. It’s ridiculous.
Even a used Nissan Leaf with degraded batteries is a viable vehicle in many U.S. cities. I would not call these markets "niche", there are many mid-large metropolitan population centers where they are practical. To use "niche", is either a political denial or ignorance of the population distribution of the United States. They are popular where I live, I drove one as a primary vehicle for 8.5 years, and I have purchased another used Leaf for my teenager. The empty pickup truck is also a "niche" vehicle with this usage -- it clearly isn't an appropriate choice for every driving need and locale.
That was my thought too. They obviously won’t face pushback entering the US from a legal standpoint, but I don’t think consumers will tolerate a sub-200 mile EV well here
> They obviously won’t face pushback entering the US from a legal standpoint
I suspect the current federal government might push back on a Mexican EV just for ideological reasons.
I think people are misunderstanding. This is a car for Mexico, nothing to do with the US.
On the website it says it's a car "designed in Mexico for Mexico" https://www.olinia.auto/
It's funny how we Americans jump to judging this vehicle by our own needs.
I would happily buy this and drive it if the US government let us.
Here is the company's website:
https://www.olinia.auto/
It makes a lot more sense seeing the image where they place it between a car and rickshaw/tuktuk
> Ford CEO
I wonder how this compares to the late '60s and through the '70s, when small, higher-mileage imports were eating the US car manufacturers' lunch. It feels more existential, but maybe not?
"The car’s unvieling comes as some countries around the world continue to push EV adoption with better and more affordable options. The U.S., however, has taken the opposite track."
Lol, so true. I honestly don't mind waiting for an electric car since I hope to get more mileage out of my current one. If it lasts 10 more years, all the better.
The cars available then should be far better (other than new things I might not want- e.g. more automation).
Hoping this brings EV infrastructure up in the country. A road trip is still quite an ordeal due to the lack of fast chargers in highways and maybe that's why the range on the first version of Olena is low, as it's aimed to provide "ultra mobility" within cities and not outside of it but still, glad to see the MX government invest into renewable technology.
Would this be enough range for a typical bit of driving in CDMX? Seems like a painful road trip car, but you don't need so much range for a city car.
I hope we don't see these on any highways. They can only do 50 kph.
There is no way Olina will make it to market. It is another of the demagogic populist government's projects.
Personally, I'm very happy about the increasingly competitive EV market. Hopefully they will start exporting those to the British market. Don't we all love cheap things?
My first thought when looking at it is that I doubt the vehicle could pass US safety regulations. Maybe I'm wrong.
In Europe these kinds of vehicles are treated as micro vehicles. You don’t even need a driver licenses.
https://insideevs.com/news/401218/citroen-ami-deliveries-jun...
Based on similar vehicles in Europe, it's probably not a car but some sort of motorcycle.
Motorcycle licensing is a bit specific( at least in California ) even if one has an automobile license, I only looked at it casually, have to buy special clothes for the training class and pass before getting learners permit to get practice for taking state test, but most of the skills learned in the training class are not applicable to this vehicle AFAIK. I would speculate it's closer to a Japanese small form factor Kei truck which are importable under certain restrictions - which must be 25 years old or older, not legal for public road use in many(most?) places due to bumper/crash testing/airbag requirements, though I've seen a couple in California in suburban/rural areas. Also see tourists driving essentially golf carts in places like San Diego on downtown streets. It seems murky to me.
If they ever make more than 50 of these at twice that cost I'll become a monk
Have you ever paid attention to what's on the road in Mexico? I've driven there for 30 years and I've seen it all.
Then, there's the idea that Mexicans might not be able to manufacture a quality vehicle. My 2001 Toyota Tundra was manufactured in Mexico and I will drive it until I die. Basically a grail vehicle.
Places like Monterrey have multistory quite modern BYD dealerships. You might start shopping for monasteries ;-)
How foreign competition helps domestic firms: https://capx.co/how-foreign-competition-helps-domestic-firms
Hopefully they can also find a good balance between using cheap parts to actually being safe and comfy. The cheap EVs on the market normally lack in one of these. I have not yet found any interior shots online, did any of you?
There are a couple of partial interior shots on their home page: https://www.olinia.auto/
How big is the charging infrastructure in Mexico? Or is this mainly geared for a daily commutes and charging at home?
It's top speed is 50 kph so it's not for travelling very far or on highways.
This vehicle is what most Americans would call a "golf cart". If it doesn't have safety features and can't be driven on highways, it's not really competing with normal cars, so I'm not quite sure the article's analysis makes sense.
they're going to put six people on those small wheels on that small wheelbase?
on the otherhand the mass produced general frame/battery/motor will be great for mods
Six Mexicans, not six Americans.
> The car is designed for urban settings and has a top speed of 50 kilometers (31 miles) per hour.
Stopped reading here. For all intents and purposes this is not a real car, it's a golf cart. The title is complete clickbait.
The amount of power used to keep a car going at highways speeds is 60% air drag. With how much people value range in EVs, why is it that almost every manufacturer designs theirs as literal boxes on wheels with some lights and doors? Cars in the 1920 almost had better aero and they had no idea what it even was.
"The car is designed for urban settings and has a top speed of 50 kilometers (31 miles) per hour."
Looks like they know nothing about drag coefficient.
That doesn't matter very much when the top speed is 50 kph.
31 MPH and needs to be re-charged after only 77 miles.
This thing is not a car. It's usefulness in USA would be like shuttling around a mall parking lot or between airport terminals.
Even the $8,500 pricetag seems crazy for something with very little actual utility.
These are usually called LSVs; the number of these is low but growing because in dense urban areas or planned developments (golf courses, parks, senior communities) they're far more cost effective.
counterpoint: I have an EV that I never drive more than 77 miles a day and I paid over $70k for it. Top speed would definitely be a limiting factor, but I do think there's a huge gap in the mobility market between e-bike and a traditional (and expensive!) car.
Luckily it was not designed to be used in the US.
Well I'll be surprised if it's ever actually used anywhere.
Dunno man, once you’ve seen a family of four plus cargo riding a moped you’ll realize people will use anything that gets them where they need to go.
For the people who don't believe this, spend some time watching urban traffic in a place like Oaxaca. 4 is a bit of a stretch unless it's a couple of small kids (that happens) and the moto is not really a moped, but not much more powerful. There's occasional bulky cargo. I am also reminded of the multiple times we were riding in a bus in Cairo Egypt and passed a donkey cart in the left lane of a 6 lane-ish "free"way.
One of the first things I thought when I first saw this thing is, oh, there will be mods.