Weekly Electromobility News

Mercedes-Benz Will Unveil Its First 310-mile Electric Car During Paris Motor Show in October; GAC and LeEco Form Joint Venture; 11,539 CHAdeMO DC Quick Chargers Have been Installed; Tesla Favored to Grow to $700 Billion By Investor

 

Mercedes-Benz Will Unveil Its First 310-mile Electric Car During Paris Motor Show in October

According to Reuters, Mercedes-Benz Chief Development Officer Thomas Weber disclosed that a prototype electric car with range of 500 km (or 310 miles) would be displayed in Paris in October this year, during a journalists event in Stuttgart.

Mr. Weber this time did not say a specific launch date. A Car Magazine article in December 2015 wrote the company would launch a long-range electric sedan in 2018, with the size between C-class and E-class. The sedan will be followed by two crossovers and one limo.

GAC and LeEco Form Joint Venture

According to Guangzhou Automobile Group Co., Ltd. (GAC) website, GAC, LeEco and Urtrust Insurance formed a joint venture (called Dasheng) in Guangzhou China, on June 8th.

GAC is one of the top carmakers in China (which is also true for plug-in hybrids). LeEco is a Chinese technology company often viewed as the Chinese Netflix. LeEco is the backer of Faraday Future.

Dasheng is a car O2O company. In the JV, GAC, LeEco and Urturst own 45%, 40% and 15% respectively.

11,539 CHAdeMO DC Quick Chargers Have been Installed

CHAdeMO updated the number on June 6th. There are 6,469 chargers in Japan, 3,178 in Europe, 1,784 in the US and 108 in the rest of the world. Compared to the numbers in April, there is no change on the number for Japan, but 248 chargers have been added outside Japan.

CHAdeMO also announced the even faster 150kW version on June 1st. First installations are expected next year. 350kW is under study as well. Current CHAdeMO Quick chargers are rated at 50kW.

 

Tesla Favored to Grow to $700 Billion By Investor

According to Bloomberg, Ron Baron, whose investment company owns Tesla stock worth about 1% of the market value, implied that the EV maker would be as large as $722 billion in 10-20 years. The market responded by a 6.2% increase in share price on Tuesday.

Tesla’s market cap currently is around $34 billion. Baron said Tesla could become a global top company and it would stay ahead of electric car competition.

Not everyone is as optimistic. A month ago, Mike Jackson, AutoNation Chairman and CEO, called Tesla’s 500 thousand vehicles ramp-up plan “mission impossible”.

Weekly Electromobility News

Tesla Superchargers Will Not Be Free for Model 3; Faraday Future Starts to Negotiate on Second Manufacturing Site; Battery Caused Fatal Explosion in a Battery Factory in China

Tesla Superchargers Will Not Be Free for Model 3

According to Wall Street Journal, Elon Musk said that Tesla would charge the owners of “its lower-cost vehicle” for using the Superchargers. This allows the company to decouple the charging cost from the vehicle cost.

Musk commented that the rate would be “very cheap” and there would be an option for purchase for accessing the charging network “free long distance for life”.

Faraday Future Starts to Negotiate on Second Manufacturing Site

According to Los Angeles Times, on May 31st, Faraday Future (through its FF LLC entity) got approved by the Vallejo City Council on an “exclusive negotiating agreement” with the purpose of purchasing “a 157-acre parcel of land on Mare Island”, near Silicon Valley. The land formerly was a naval shipyard.

This latest move follows the start of construction of the company’s 900-acre factory in Nevada less than 2 months ago.

Faraday Future was founded in 2014. It presented an electric concept supercar FFZero1 during 2016 Consumer Electronics Show.

Battery Caused Fatal Explosion in a Battery Factory in China

According to itdcw.com, in May 31th, battery manufacture Highstar in Jiangsu, China had an explosion accident. The explosion has killed 2 people and injured 18 more.

Investigation indicated that the explosion could be caused by a defect battery. The battery could have an internal short-circuit which led to thermal runaway. It propagated to nearby batteries and caused explosion.

Production has since been stopped on site.

Weekly Electromobility News

Tesla Model 3 Launch to Receive Funding from New Stock Sell

Reuters reported that Tesla plans to raise up to $1.7 billion by new stock sell, to prepare its Model 3 launch. The company in a prospectus said that up to 8.2 million common stock shares will be sold at an expected price of $204.66 per share.

Tesla plans to advance its 500,000-unit production goal to 2018, which is 2 years earlier than the original plan. This adjustment was made in response to the encouraging 373,000 pre-orders of the Model 3. The new fund will mainly be spent on production expansion and supplies.

The 2018 goal is viewed by analysis and suppliers too aggressive. Tesla hired Peter Hochholdinger as VP of vehicle production last week. For Q1 this year, it posted a non-GAAP net loss of $0.57 per share and a GAAP net loss of $2.13 per share.

BMW Sued over i3 Allegedly Defected Range Extension Feature

MLG Automotive Law in a press release stated that it filed a lawsuit case against BMW North America on May 17th. The lawsuit is over alleged defects in BMW i3 with Range Extender. It is a national class action case.

As mentioned in the press release, allegedly in practice, when the range-extending engine operates, the car will speed down as the battery runs to low state of charge, if under significant load conditions like “going up a hill, or loaded with passengers”.

Similar issue was seen online more than one and a half years ago. BMW was reported to have an enhancement through software upgrade and other measures. There also is a recall for mount screw in the US.

Formula E Plans to Race in New York City Next Year

According to CNN, Formula E is trying to have NYC host one round of the championship next year. The CEO Alejandro Agag is “very optimistic” about its happening.

Formula E Championship uses open-wheel electric cars to race, kind of the electric car version of Formula 1. With a 28 kWh battery pack, the cars can output as high as 270 HP. The top speed can reach 140 mph.

The 2015-2016 season is the series’ second season. There are 9 teams and 19 racers to compete.

Weekly Electromobility News

Total S.A. and Saft Groupe S.A. Announce Proposed Acquisition

Oil giant Total S.A. on May 9th filed an acquisition offer on all of Saft Groupe S.A. shares with French Financial Markets Authority, upon mutual agreement between the two companies.

Saft is a well-known battery maker. It is a major supplier of nickel-based and primary lithium batteries for industrial use. Its products include lithium-ion batteries and packs as well.

The proposal values Saft at €950 million (or $1.07 billion), which reflects a 38.3% premium over Saft’s recent share price.

This transaction further represents Total’s plan to invest on renewable energy technologies. In 2011, Total acquired solar panel manufacturer SunPower.

 

BMW to Launch i NEXT Flagship Vehicle in 2021

The Verge reported that BMW will expand i product lineup and launch i NEXT vehicle in 2021. The news came from comments made by BMW chairman Harald Kruger during the company’s 96th Annual General Meeting.

New i NEXT will be the flagship of BMW, an “innovation driver” setting standards for electromobility technologies in the future. The car will be the platform for new autonomous driving, connectivity, lightweight and interior look.

Moreover, new-generation i3 with 50% more capacity (94 Ah cell) and up to 200 km range will be available in a few weeks. i8 Roadster is confirmed for 2018 launch.

 

Tesla is Still Finalizing Model 3 Design

Reuters reported on May 10th that Tesla still has not finalized its Model 3 design yet. Tesla’s CEO Elon Musk mentioned during a conference call that the design freeze would need another 6-9 weeks.

Model 3 delivery is expected to start in late 2017 and the company’s production capacity will ramp up to 500,000 units per year by 2018.

There have been some personnel changes recently. Former Audi veteran Peter Hochholdinger joined Tesla as VP of vehicle production, following the departure of Tesla’s previous VPs for production and manufacturing.

Weekly Electromobility News

Total Electric Car Sales Exceed 200,000 in California

California Plug-in Electric Vehicle Collaborative (PEVC) data revealed that in April, cumulative sales (since 2011) of cars with a plug have reached 202,744, of which 6,296 units were added in the month. Nation-wide, April sales are 12,109 units and total sales since 2011 have become 440,924 units.

Based on data from EV Obsession, Models exceeding 1,000 sales in April in the US include: Tesla Model S all-electric (2,000 units); Chevrolet Volt plug-in hybrid (1,865 units), Nissan LEAF all-electric (1,246 units), Ford Fusion Energy plug-in hybrid (1,238 units) and Tesla Model X all-electric (1,200 units).

Mitsubishi Outlander Plug-in Hybrid Joins 100,000-sales Club for Electric Cars

According to Hybrid Cars, Mitsubishi Outlander plug-in hybrid has sold 101,900 units through March this year. Nissan LEAF, Tesla Model S and Chevrolet Volt (including Opel/Vauxhall Ampera and Holden Volt) have achieved the same milestone already – 218,000, 120,000 and 110,000 respectively.

The car has a 12-kWh battery pack and can run 32.5 miles on electric. US sales will start later this year.

Tesla Motors Releases Q1/2016 Shareholder Letter

The update released on May 4th indicated that the company plans to expand to 500,000 units per year in 2018, two years ahead of the previous schedule. Q1 non-GAAP net loss was $0.57 per share and Q1 GAAP net loss was $2.13 per share.

The new production expansion goal is doubted by Wall Street. AutoNation Chairman and CEO Mike Jackson calls it “mission impossible”.

Moreover, Reuters reported that Greg Reichow – Tesla’s vice president of production, and Josh Ensign – Tesla’s vice president of manufacturing, have left Tesla.

Fuel Cell Vehicles Forecast to See Annual Production of over 70,000 Units by 2027

IHS Automotive released the report forecasting over 70,000 hydrogen fuel cell vehicles produced annually by 2027. Between now and then, 17 models powered by a fuel cell will be made available. OEMs in Japan and Korea are the major players in the market for now. European carmakers will take the lead by 2021. 70,000 will represent lower than 0.1% of total car sales by then.

Earlier, The Asahi Shimbun reported that Toyota is working on a mass-production version of its Mirai fuel cell car with less cost, around $50,000-$55,000 before government incentives. The company targets 2019 to start delivery.

Adoption of Electric Cars Decreases the Demand for Platinum

Bloomberg analyzed that as the car industry is switching to the electric, world demand for platinum will decline significantly. In 2015, about 42% of the metal went into cars, mainly as a catalyst to control emissions. Electric cars are eliminating tailpipes, thus the need for platinum.

Interestingly, platinum may see a new opportunity with fuel cell vehicles. In current fuel cell technologies, platinum is a key component to use hydrogen and oxygen to generate electricity.

Model 3 Pre-order is a Nice Marketing Move for Tesla

On March 31th, Tesla Motors started to accept pre-orders for Model 3 – its 215-mile, $35,000 entry-level luxury electric car in the make. People were lining up at the stores, waiting for hours to make a reservation, something quite unusual for car sales.  In the first 24 hours, the number of pre-orders reached 180 thousand. Then in 1 week, the number climbed up to 325 thousand. This is huge, considering, for the whole year of 2015, only 114,022 vehicles with a plug were sold in the US.

Larger than the pre-orders is that it gets Tesla enough attention – Model 3 topics are trending everywhere; people are tracking the numbers; news all over place etc. Everybody seems to get hyped about the concept car.

The reason I say this is that, if you think about it, the pre-order has little to do with the commitment of eventually owning a Model 3.

The $1,000 reservation fee is totally refundable at any time before one actually orders the car. So there is little commitment from potential buyers who put in $1,000. The refundability makes the decision on pre-order very easy – it is like “I might be interested in getting a Model 3. Let me just put $1,000 for now. If I change my mind, I just ask for my money back.”

One argument for the necessity of pre-order is that it can make the buyer eligible for government incentives. One such incentive is the federal tax credit of up to $7,500 in the US (And Tesla sales in the US does account for more than 50% of its total sales in the past). The caveat is that this tax credit is applied to only the first 200,000 electric cars sold by Tesla in the US. Considering 60k+ of those have gone to Model S already so far already, if your pre-order number is over 200 thousand, the chance for your to claim the full amount of tax credit is very slim.

However, afterwards, buyers may still be able to get some tax credit during the “phase-out period” (half or quarter of $7,500 in the first 2 quarters and the next 2 quarters respectively). Then the question comes to how many cars Tesla can possibly manufacture during the “phase-out period”. Given the rate at which the number of pre-orders grows, the production capability needs to be boosted exponentially in order to help buyers get at least something for the federal government.

On the other hand, Model 3 is pretty much a concept car at the moment – meaning things can change over the next one and half years. One thing is related to the pricing. $35,000 for an entry-level luxury car with an expensive high energy battery feels a bit unreal. In comparison, the price for the not-so-luxury Chevy Bolt electric car with similar electro-range starts at $37,500.

Therefore, the pre-order event is a successful marketing move for Tesla to a large extent. The success is built on Tesla’s populated fan base. This makes even more sense since Tesla is known for using social media to promote instead of traditional advertising.

For the class of 200-mile electric cars, Chevy Bolt will start delivery later this year and the new-generation Nissan LEAF is targeting year 2018 (similar timeline as Model 3). Just with a concept car and this pre-order event, Model 3 nicely steals the thunder.

Second-life Applications Could Help Reduce the Cost of EV Batteries

High battery cost keeps the cost of electric vehicles (EV) high. As a result, carmakers still are relying on government incentives to sell EVs at somewhat more acceptable price. It was recently reported on Forbes that the cost of battery pack in the new 200-mile Chevrolet Bolt would be significantly reduced to under $300/kWh (The packs will be supplied by LG Chem). It is interesting to notice that some existing battery replacement plans/warranties have already put the $/kWh well below 300.

General Motors Chairman and CEO Mary Barra drives the 2017 Chevrolet Bolt EV onto the stage Monday, January 11, 2016 at the North American International Auto Show in Detroit, Michigan. GM Executive Vice President Product Development Mark Reuss rides in the passenger seat. The Bolt EV offers more than 200 miles of range on a full charge at a price below $30,000 after Federal tax credits. (Photo by Jeffrey Sauger for Chevrolet)
(Photo: Barra Drives Chevrolet Bolt EV Into NAIAS Spotlight, on January 11 2016. © General Motors.)

More than 3 years ago, Tesla introduced a warranty option to replace the 85 kWh battery pack for $12,000; That equals to $141/kWh. In 2014, the Chevrolet Volt 16 kWh battery pack was seen sold at $2,994.64 or $187/kWh. In the same year, Nissan announced the battery replacement plan for LEAF. The cost is $5,499 including $1,000 for trading-in the old battery. The $6,499 total cost leads to $271/kWh. (More data on cell/pack price can be found at our homepage.)

The gap in battery cost can be partly filled by the batteries’ second-life applications.

EVs have stringent requirements on their batteries. To name a few – 1) EV batteries need to be weigh/space efficient to fit into a car, meaning high energy densities; 2) EV batteries need to be cycled in wide SOC windows (60-80%) to drive a long enough range on one charge; 3) EV batteries need to be able to deliver enough (like 70-80%) energy as battery ages, so drivers do not get angry with decreasing range; 4) EV batteries need to be able to deal with difficult load conditions like acceleration and fast charging.

That being said, end-of-life EV batteries are not dead batteries really. They can still serve well in less stringent conditions anywhere from huge MWh front-of-the-meter grid stationary storage to tiny portable power bank for your phone.

In any of these cases, high energy density is no long a must, batteries can be cycled in a narrow SOC window, batteries can retain less energy and the load conditions can be relatively mild and constant.

In November 2015, Daimler announced the plan to build a 13 MWh grid storage unit in Germany. It uses repurposed batteries from the electric car Daimler smart. The project was claimed to be the largest of its kind (with second-life batteries).

Nissan partners with Green Charge Networks to reuse its EV batteries for electrochemical energy storage (EES) applications. The behind-the-meter battery system can store electricity when the demand is low and produce electricity as the demand spikes. So users can save on demand charges. There was rumor that these old batteries would cost around $100/kWh.

Tesla reportedly has plans to give its EV batteries a second life as well. The residential energy storage product Powerwall sells for $3,000 per unit of 7 kWh. Can there be second-life batteries utilized?

For now, second-life applications can help reduce the price for battery replacement. How they can benefit EV buyers from the very beginning can be a quite interesting area to explore.

Moreover, battery reliability during the life span of an all-electric car or a plug-in hybrid lacks enough real-life data to support, since most of popular models came in after 2010. There were reports on cars like Nissan LEAF that the energy retention after a few years of driving was better than originally projected. Whether these cars need to replace the battery at all or not still would be an open question. And this would have an impact on how we see used electric cars.

It feels like electric car is but only a new technology, but also can change many things in our lives when they prevail.