What’s going on everyone. Welcome back to the All Things EV Podcast. In S1 E3 I cover news about the Porsche Taycan, Toyota / Panasonic battery partnership, the F150 going electric, and a flurry of unexpected changes at Tesla.
EV website Electrek is reporting that Porsche is upping their production numbers for their first all electric sedan, the Taycan, to 40,000 units per year. Porsche previously stated they were going to produce 20,000 units. They clearly have a growing confidence in the demand for the Taycan if they are doubling production expectations.
For some context, in 2018 Tesla produced just under 25,745 Model S units and 26,100 Model X units. 40,000 units annually from Porsche would be extremely impressive. One thing is for certain, production of a vehicle should be one of the easiest hurdles for Porsche, a company that has been around since 1931.
Personally, this is THE EV I am most looking forward to in 2019. The vehicle will have 310 miles (500 km), a 0-60 mph (0-100 kph) time in under 3.5 seconds, 600+ horsepower, and a charge rate of 350 kW.
Toyota and Panasonic battery production:
Toyota’s press release states:
By around 2030, Toyota aims to have sales of more than 5.5 million electrified vehicles, including more than 1 million zero-emission vehicles (BEVs, FCEVs).
Additionally, by around 2025, every model in the Toyota and Lexus line-up around the world will be available either as a dedicated electrified model or have an electrified option. This will be achieved by increasing the number of dedicated HEV, PHEV, BEV, and FCEV models and by generalizing the availability of HEV, PHEV and/or BEV options to all its models.
As a result, the number of models developed without an electrified version will be zero.
Toyota also adds:
Toyota will accelerate the popularization of BEVs with more than 10 BEV models to be available worldwide by the early 2020s, starting in China, before entering other markets―the gradual introduction to Japan, India, United States and Europe is expected.
The FCEV line-up will be expanded for both passenger and commercial vehicles in the 2020s.
In my opinion, this is a huge step in the direction of electrification. Batteries are at the core of electric vehicles and to ink a partnership with Panasonic is a major public commitment.
Ford going electric with F150
Car and Driver quotes Ford President Jim Farley saying on a January 16 investor phone call that “We're gonna be electrifying the F-series—both battery-electric and hybrid.”
This is likely in response to the host of new vehicle start ups charging ahead with all electric pick up trucks like Rivian, Altis, Bollinger, and Tesla. Understandably, too, as the Ford truck series alone sold more than 1 million unites in 2018.
Though Ford’s plan’s sound cool, they have not released any specs on the truck and we likely won’t see this truck hit production until after 2020.
Model 3 receives European approval
Last week LA Times reporter, Russ Mitchell, broke the news that Model 3 received approval from European authorities to sell their car on the continent. I have seen multiple reports this week that the first wave of Model 3s have arrived on European shores. Though not confirmed, it is my understanding that Tesla marries the drivetrain with the car in their Netherlands facility.
Tesla increases, then decreases Supercharging prices
According to Electrek, Tesla increased their charging prices on Superchargers more than 30% last week. After customer backlash, Tesla decided to reduce the price increase by 10%. This price increase is just one of several adjust Teslas has made to increase their changes of profitability in Q1 2019.
Tesla referral program will end on February 1
In another surprising and unexpected piece of news from Elon last week he stated that Tesla would be doing away with the referral program on February 1. Elon shared on Twitter saying, “The Tesla customer referral program will end on Feb 1. If you want to refer a friend to buy a Tesla & give them 6 months of free Supercharging, please do so before then.” When asked if it was ending for good he responded by saying, “Yes, ending on Feb 1. It’s adding too much cost to the cars, especially Model 3.”
Tesla lays off 7% of employees
The other bombshell of news coming out of Fremont last week came from a grim letter from Elon to employees that Tesla will layoff about 7% of their workforce to remain profitable.
If you recall Tesla laid off about 9%, or about 3,000 of their workforce in June of 2018 as a push toward a profitable Q3. With this most recent round of layoff they are laying off another 3,000.
It’d be one thing if it was “just” a round of layoffs. The tone of Elon’s most recent letter to employees depicts a very, to use his words, “extremely difficult challenge.” He adds, “ This quarter, as with Q3, shipment of higher priced Model 3 variants (this time to Europe and Asia) will hopefully allow us, with great difficulty, effort and some luck, to target a tiny profit.”
Continuing Elon says, “Tesla will need to make these cuts while increasing the Model 3 production rate and making many manufacturing engineering improvements in the coming months. Higher volume and manufacturing design improvements are crucial for Tesla to achieve the economies of scale required to manufacture the standard range (220 mile), standard interior Model 3 at $35k and still be a viable company. There isn't any other way.”
He ends the letter by thanking those who will be departing and says that he is deeply grateful for their contributions to Tesla.
My thoughts: This is tough. To those impacted by this round of layoffs, I’m very sorry to hear. I don’t think anyone expected layoffs after two positive quarters. Furthermore, the outlook Elon is depicted is grim. Tesla will need to cut costs and get even more efficient with how they make their cars with less employees. I do have some thoughts on how they can do more with less that I will share in a video on my YouTube channel this week. If you’re not subscribed and are interested in my thoughts, I’ll put a link to my YouTube in my show notes on my website, AllThingsEV.info/Podcast.
Layoffs, price increases, referral program ending, and unconfirmed reports of a Tesla spending freeze all point to a very challenging next 6 months. With that said, we should get more clarity on Tesla’s plan to produce revenue in their upcoming January 30 earnings call.
This week I had a chance to visit a Colorado power provider, United Electric, to see Colorado’s largest Tesla Powerpacks install. United Electric has purchased a 4 MW battery storage system from Tesla to help reduce their peak rate costs in what they call peak shaving. This is an eight minute long interview that I think you’ll really enjoy. Let’s take a listen.
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