In essence, they’re suggesting that the damage is done, the investments are made, so they need to somehow generate a return on those investments before Trump pulls the plug on the mandates.

A report by Brady Knox over at Washington Examiner, commenting on a NY Times article, suggests car companies may ask President Trump to keep Joe Biden’s rules in place for now:

According to a report from the New York Times, the Biden administration’s actions to boost domestic EV manufacturing may have already set the auto industry past the point of no return. Following Biden’s initiatives, automakers have already invested billions of dollars in transitioning to electric vehicles. If Trump were to scrap the initiative, major automakers fear they could be undercut by smaller manufacturers producing cheaper, internal combustion engine cars.

Three of the country’s largest automakers, Ford, General Motors, and Stellantis, are already lobbying Trump against scrapping the rules.

Some had hoped that one of the biggest proponents of electric cars, Tesla CEO Elon Musk, would be able to sway Trump to keep those rules in place, but now, his priorities seem to be cutting regulations. He expressed opposition to the $7,500 tax credit for buyers of electric cars, saying he opposes all subsidies.

“In my view, we should end all government subsidies, including those for E.V.’s, oil and gas,” Musk said last week.

Musk’s calculation was more cynical in a July earnings call, speculating that the end of the subsidy would hurt Tesla somewhat, but hurt its competitors much more.

Is it worth keeping the mandates so the big three U.S. automakers can prevent smaller competitors from eating their lunch?

Nope, Not Worth It

As horrible as the situation is for major U.S. automakers, keeping the mandates in place would be far worse. Americans need relief far more than automakers right now. Getting the price of vehicles down to a manageable level is crucial if America is going to have any chance of recovering from the financial decimation we’ve felt for the last four years.

But there’s actually a good business reason for pulling the mandates immediately. The Biden-Harris regime forced automakers to try to usher in a future that was too far off, but that doesn’t mean OPTIONAL electric vehicle adoption isn’t part of the future.

The damage has been done by the mandates, but there have also been significant investments into research and development that can flourish if they’re allowed to transition without government interference. In other words, they can return to internal combustion engines as the primary driver for now to get their revenues back while reducing costs for American consumers. Simultaneously, they’ll be expanding on what they’ve built in EV infrastructure, albeit without mandates forcing the issue. They’ll be able to work at the speed of the market instead of the mandates.

It’s a sour consolation for the biggest automakers because it means they’ll have to wait years or even decades to realize benefits from their electric vehicle investments, but the long-term returns should be worth the wait… if they can survive long enough to see them.

Rather than using the current rules to stifle competition, they should hope that President Trump immediately sides with the free market and the consumers to allow enough short-term benefit for U.S. automakers to recover.

VW’s profits fell 64% in the third quarter of 2024, driving the company’s share price to its lowest level since October 2010. Now, the world’s largest automaker by sales is looking to lower its expenses, with VW’s top labor leader announcing earlier this week that the company was aiming to shut at least three of its German factories, slash wages 10% and lay off thousands of employees.

“We’ve not forgotten how to build great cars, but the costs, specifically in our German operations and factories, are far from being competitive,” Chief Financial Officer Arno Antlitz told The Wall Street Journal Wednesday. “Things cannot continue as they are now.”

VW crisis is getting worse…

Volkswagen’s Q3 profit dropped a steep 64%, largely due to big losses in China. Their net profit fell from €4.34 billion last year to €1.57 billion, and revenue dipped to €78.5 billion. The group’s operating profit margin also shrank, while the… pic.twitter.com/CtumLnjXHW

— Bullion Bite (@bullionbite) October 30, 2024

VW’s profitability challenges come as consumer demand for EVs has weakened in recent years, with EV sales growing 50% in the first half of 2023 and 31% in the first half of 2024, far less than the 71% increase in the first half of 2022. As a result of this decline, the company walked back plans to sell shares in its EV business in January.

The automaker’s disappointing earnings also result from increased Chinese competition in the EV market, the WSJ reported. Deliveries in the Asian superpower fell 15% in the third quarter of 2024, largely due to lower-cost Chinese options such as BYD’s 2025 Seal EV.

VW’s cost-cutting plan would mark the first time the company has shuttered one of its German factories in its 87-year history, and has brought significant backlash from worker groups. Daniela Cavallo, head of VW’s works council, said tensions could “soon escalate” into a strike during a speech in Wolfsburg, Germany — the site of a VW factory that the company’s website describes as the “heart” of the brand.

“I’m confident that we’ll reach an agreement … but of course, I cannot rule out strikes,” Antlitz told the WSJ.

VW did not immediately respond to a request for comment.

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(DCNF)—Resale values for electric vehicles (EVs) have cratered as a slackening of consumer demand has weighed down prices.

Automakers have offered a flood of price cuts on new models in a bid to prop up sales amid lower-than-expected demand, according to The Wall Street Journal. The discounts have caused EV resale values to plummet, with the average selling price of a three-year-old EV falling to $28,400, a 25% decrease from the start of 2023 and a lower price than that of a internal combustion vehicle of the same age.

As a result, as of August EV owners owed roughly $10,000 more on their car loans than their vehicle was worth, up from $8,000 at the beginning of 2023, the WSJ reported.

“They kept reducing the price of the cars, which killed the used-EV market,” Christian Lange, a former 2018 Tesla Model 3 owner, told the WSJ. Lange saw his vehicle’s value decline by $10,000 relative to what he owed on his loan following the 2023 price cuts.

Buying business, causing massive depreciation, a race to the bottom, and ruining the motor trade as they do it!

But yeah, EV's are selling just fine! and if you think that you are a fucking idiot

"Average discounts on EV's are now almost double what they are on ICE vehicles"… pic.twitter.com/rLvax7d4WM

— Barrie Crampton (@BarrieCrampton) October 10, 2024

The price cuts followed lower-than-expected demand in 2023 and 2024, with EV sales growing 50% in the first half of 2023 and 31% in the first half of 2024, less than the 71% increase in the first half of 2022. Meanwhile, a June poll from The Associated Press-NORC Center for Public Affairs Research and the University of Chicago’s Energy Policy Institute found 46% of respondents were unlikely or very unlikely to purchase an EV, while just 21% were “very” or “extremely” likely to make the change.

The faltering demand comes despite billions in subsidies from the Biden-Harris administration, including a $7,500 federal tax credit for certain EVs to ease costs for buyers. Experts previously told the DCNF the faltering demand was due to consumer aversion to lower mileage ranges, a lack of charging infrastructure and higher vehicle prices.

“Even after throwing money at EVs hand over fist, basically paying people tax dollars to drive these cars off the lots, you have a dire spiral of (1) not enough demand to support the number of cars being produced, and (2) the people you paid to buy them now wanting to go back to what they had before,” O.H. Skinner, executive director of the Alliance for Consumers and the former solicitor general of Arizona, previously told the DCNF.

A $4,000 credit for used EVs under $25,000, implemented as part of President Joe Biden’s Inflation Reduction Act, has also contributed to the plummet in resale values by incentivizing dealers to lower prices below the $25,000 maximum, according to the WSJ.

Tesla did not immediately respond to a request for comment.

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“We’re seeing a tremendous amount of competition,” John Lawler, Ford vice chair and CFO, told journalists in a conference call. “In fact, S&P Global … said that there’s about 143 EVs in the pipeline right now for North America — and most of those are two-row and three-row SUVs.”

The news that Ford was scrapping its SUV EV came just a month after the company announced a manufacturing pivot at its plant in Oakville, Ontario. The plant, which had been earmarked for EV production, was shifting production to Ford’s F-series pickups, its flagship gas-powered trucks.

“The move,” the New York Times reported, “is the latest example of how automakers are pulling back on aggressive investment plans in response to the slowing growth of electric vehicle sales.”

The Cost Problem

Ford’s latest pullback from EVs is no surprise to people who’ve been paying attention to the EV market.

More than a year ago I pointed out that news outlets were reporting of EVs “piling up” at dealership lots because of low consumer demand, which ultimately prompted Ford to halve production of its popular F-150 Lightning, reducing output to about 1,600 vehicles per week.

The reality is both lawmakers and Washington and auto companies severely misjudged consumer demand for EVs, which has proven far lower than estimates had projected. There are many reasons for the low demand, but the primary reasons are concerns consumers have with EVs.

Price is one factor. Research in recent years has indicated that despite government subsidies, EVs typically cost on average between $5,000 and $10,000 more than a similar gas-powered vehicle. That EVs are more expensive than gas-powered cars may surprise few readers, but what’s less known is that the price gap is widening.

“EV prices aren’t just going up; they are rising faster than inflation…faster than [internal combustion engine] vehicle prices” Ashley Nunes, a senior research associate at Harvard Law School, testified before Congress in 2023, noting that the inflation-adjusted average price of a new EV had risen to over $66,000 in 2022, compared to $44,000 in 2011.

The Charging Problem

Cost, however, isn’t the only concern of consumers.

An overwhelming percentage of Americans—77 percent, according to a 2023 survey led by the Associated Press-NORC Center for Public Affairs Research and the Energy Policy Institute at the University of Chicago—have concerns about how they would charge an EV if they bought one.

These concerns are not baseless. In February, the New York Times profiled a man Michael Puglia who had recently bought a Ford F-150 Lightning and said it was the “coolest” vehicle he’d ever owned.

“It’s unbelievably fast and responsive,” the Ann Arbor, Mich., anesthesiologist told reporter Neal E. Boudette. “The technology is amazing.”

The problem was the vehicle’s range. When the weather grew colder, Puglia found that the distance his vehicle could travel fell dramatically. His faith in the $79,000 truck dampened, and he found himself wondering if he should sell it.

“People say ‘range anxiety’ — it’s like it’s the driver’s fault,” Puglia told the Times. “But it’s not our fault. It’s actually they’re not telling us what the real range is. The truck says it’s 300 miles. I don’t think I’ve ever gotten that.”

The range problem of electric vehicles is exacerbated by another challenge facing EVs: a lack of charging stations. Nationwide, there was 68,475 private and public charging stations at the beginning of the year, according to the Department of Energy. That’s more than twice the number in 2020, but it’s still just a third of the number of gas stations and far below projections.

The range problem of electric vehicles is exacerbated by another challenge facing EVs: a lack of charging stations. Nationwide, there was 68,475 private and public charging stations at the beginning of the year, according to the Department of Energy. That’s more than twice the number in 2020, but it’s still just a third of the number of gas stations and far below projections.

One reason charging infrastructure has lagged is due to the federal government’s incompetence. Nearly three years ago, the U.S. Departments of Transportation and Energy announced a $5 billion spending effort to build fleets of charging stations to lead “an electric vehicle revolution.” As of the summer of 2024, just seven charging stations had been built.

“That is pathetic,” said US Sen. Jeff Merkley, a Democrat from Oregon. “We’re now three years into this … That is a vast administrative failure.”

Of Profits, and Losses

The decision of automakers to bet big on EV adoption was in some ways rational, in that they were responding to powers in Washington that were pressuring them and incentivizing them to expand electrical vehicle production. But the costs of listening to industry experts and politicians in Washington instead of consumers — and profits — have been severe.

In August 2023, NPR reported that Ford CEO Jim Farley was charging ahead with its ambitious EV expansion even though the company was “losing money on each EV it sells” and consumer demand for EVs was plummeting. Farley’s reasoning was that Ford was attracting new customers, but it was a costly endeavor. Ford reported a loss of $4.7 billion on EV sales in 2023, roughly $40,525 per vehicle sold.

“If the great mass of consumers dislike purple cars with green polka dots, then a society based on private property will not waste resources in the production of such odd cars,” wrote economist Robert Murphy. “Any eccentric producer who flouted the wishes of his customers and churned out vehicles to suit his idiosyncratic tastes, would soon go out of business.”

Murphy wrote these words more than twenty years ago, but in a sense they describe Ford’s business strategy. By producing mass amounts of pricey EVs that consumers didn’t want and selling them at a loss, Ford was in a sense cranking out green polka dotted cars. It was a losing strategy and path to going out of business.

Ford’s massive pullback from EVs is part of a broader return to economic reality. Companies flourish in a free market economy not by serving bureaucrats but consumers, the true “bosses.”

“They, by their buying and by their abstention from buying, decide who should own the capital and run the plants,” Mises wrote. “They determine what should be produced and in what quantity and quality. Their attitudes result either in profit or in loss for the enterpriser.”

Automakers bear responsibility for their decision, and paid the price in the form of losses. But this misallocation of resources likely could have been avoided if not for the federal government’s hamfisted attempts to coerce Americans into EVs, which included not just taxpayer-funded subsidies, but overt pressure from Washington and federal regulations designed to phase-out gas-powered cars.

Fortunately, the centrally planned EV revolution now appears dead in the water, or at least in full retreat. A spokesman for Kamala Harris recently told Axios the presidential candidate “does not support an electric vehicle mandate.”

Forcing Americans into EVs was always a bad idea economically, but it now appears to be a bad idea politically, too.

That’s good news for Ford and American consumers.

But now a new ideology has surfaced in the leftist city of Denver.

It’s that there apparently are too many gas stations at which consumers can refuel, so two city council members are working on a plan to correct that.

They want to ban any station from being developed within a quarter mile of another.

It is Complete Colorado that explained the ideology created by council members Paul Kashmann and Amanda Sawyer.

They “have decided that gas stations – apparently uniquely among Denver’s many retail businesses – are taking too much space away from other priorities such as housing. In response to this deadly threat to housing density, they are close to proposing a zoning change precluding new gas stations from being built inside a quarter-mile buffer zone around existing stations.”

The report noted it isn’t the first such attack on the city’s drivers, as the tax-funded Regional Transportation District complained during the COVID pandemic that parking lots should be replaced with housing.

It seems that there have been 10 new stations in the city in recent years, bringing that total to 180, not even a 6% increase.

The plan “doesn’t say if this is an actual trend, a recent spurt, or how many of those (if any) are replacing stations that have closed. The report claims 318 permanently closed retail gas stations in Denver, or 77% more than the total now operating.”

The report pointed out Sawyers’ complaints are “somewhat ironic, ” given that her own Council District 5 serves as gasoline desert, with only two stations not bordering other districts, “meaning that those low on gas already have longer drives to fill up.”

Councilman Kashmann says that the city is allowing gas stations that ‘people don’t want and we don’t need.’ Except that nobody appointed Paul Kashmann the arbiter of what businesses the city needs, and that apparently people do both want and need them, given that there are enough gas purchases – even before the desired increased density – to keep them all in business,” the report said.

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Today a new article from Reuters lays out the numbers behind why emission free trucking remains a fallacy: emissions-free trucks need to drop in price by up to 50% to compete with diesel models, according to a McKinsey study.

Currently, less than 2% of the EU’s heavy freight vehicles are electric or hydrogen-powered, but this must rise to 40% of new sales by 2030 to meet EU climate goals. Electric trucks cost 2.5-3 times more to produce than diesel ones, and logistics companies are reluctant to bear the higher costs, making this target challenging, the report says.

McKinsey suggests electric truck prices should be no more than 30% higher than diesel models, requiring major battery advancements.

Reuters writes that a 25% reduction in charging costs and 900,000 private charging points by 2035, needing a $20 billion investment, are also key to the EU’s CO2 strategy. Additionally, European truckmakers face competition from Chinese manufacturers, who have captured 20% of the bus market with cheaper products.

A co-author of the McKinsey study said: “I don’t think it’s impossible that this could actually happen in electric trucks over time.”

Recall we wrote earlier this year that demand for electric semis was plunging.

“The economics just don’t work for most companies,” Robert Sanchez, the chief executive of Ryder, said in May.

Ryder’s experience highlights the difficulties state and federal governments encounter in encouraging truckers to transition from polluting diesel rigs to zero-emissions vehicles, the report says.

It also indicates that significant improvements in battery weight, range, and charging times are necessary for battery-electric trucks to effectively compete with diesel rigs in the cost-sensitive freight industry.

Rakesh Aneja, head of eMobility at Daimler Truck North America, told Wall Street Journal: “Quite frankly, demand has not been as strong as what we would like.”

Now, after seemingly rushing to promote electric vehicles as the future of transportation, the reality is hitting hard: fully electric vehicle interest has plummeted to a mere 11%, down from 22% just a year ago. What’s behind this sudden shift? Has the regime and their state-level proxies like California Governor Gavin Newsom failed to make their pitch?

“While we’ve seen substantial increases in interest and purchasing of EVs since 2020, this year’s MCI shows dips in demand for the first time,” – Steve Patton, EY Americas automotive leader.

Patton’s comments suggest that the administration’s narrative of a seamless transition to electric vehicles is crumbling. The supposed benefits of EVs are being overshadowed by the stark reality of their costs. A general manager from a Southern California dealership pointed out that while maintenance costs for EVs are allegedly lower, the initial expenses are “much higher” when it comes to body or structural repairs.

Interestingly, while J.D. Power’s recent survey indicated a drop in EV buying sentiment due to charging infrastructure concerns, EY’s findings show a slight improvement in that area. Only 24% of respondents now cite limited range as a top concern, down from 30% last year. Yet, the question remains: can the Biden-Harris administration truly claim success when the overall sentiment is still teetering on the edge of skepticism?

Another factor contributing to the decline in pure EV sales is the rising popularity of hybrids. EY’s survey found that 26% of US buyers prefer the flexibility of hybrid engines, compared to just 19% globally. This shift in consumer preference raises eyebrows about the administration’s singular focus on fully electric vehicles.

“For those who are looking to transition due to the environment, hybrids allow owners to lessen their reliance on fuel and creates options for batteries and parts. For many, it’s a win-win.” – Raman Ram, EY Americas aerospace, defense, and mobility leader.

The findings from EY’s report paint a damning picture for the future of EVs in America. The transition to electric vehicles is proving to be anything but smooth, and the administration’s failure to address consumer concerns could have dire consequences for mass EV adoption. As we look ahead, one must wonder: will the Biden-Harris administration pivot to embrace hybrids, or will they continue to push a one-size-fits-all approach that leaves consumers in the dust?

The company announced it now aims for between 90% and 100% of its cars to be fully electric or plug-in hybrids by the end of the decade, with the remainder being “mild,” non-plug-in hybrids, a company press release stated. Volvo’s backpedaling comes amid lower-than-expected consumer demand for EVs and a recent industry shift away from electrification.

“While Volvo Cars will retain its position as an industry leader in electrification, it has now decided to adjust its electrification ambitions due to changing market conditions and customer demands,” the company wrote. “The strategic adjustments to its electrification ambitions ensure that Volvo Cars has a flexible plan that meets customer preferences and enables value creation as a business.”

Volvo has ditched plans to sell only electric cars by 2030 amid waning demand for battery powered vehicles.

Another big manufacturer ditching EV plans. #CostOfNetZero

https://t.co/i7qPgRbjLx pic.twitter.com/AMlxhyAKwv

— Net Zero Watch (@NetZeroWatch) September 4, 2024

“We are and will remain an industry leader in electrification and nearly half of our global sales are either fully electric or plug-in hybrids,” a Volvo spokesman told the DCNF.

The company’s shift in strategy comes amid broader challenges in the EV market, with consumer demand coming in lower than proponents hoped, according to Fortune, and automakers like Rivian, Ford and General Motors hemorrhaging cash on their EV initiatives.

Ford scrapped plans to manufacture a three-row electric SUV in August, while Mercedez-Benz dropped its goal of an all-electric line-up by 2030 in February. Luxury EV maker Lucid laid off 6% of its workforce in May, equating to roughly 400 employees.

Volvo’s Wednesday announcement is the latest setback for President Joe Biden’s goal of having 50% of new U.S. car sales be EVs by 2030.

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