From The Verge:

It was only three years ago that Mercedes was feeling quite bullish about plug-in powertrains, saying that by 2030 it would only sell EVs. At the time, the company said it would completely phase out gas-powered vehicles, while including the caveat โ€œwhere markets allowed.โ€

Now it seems that the market is not allowing Mercedes to follow through on its plans. Today, the company said in its fourth quarter earnings statement that it only expects 50 percent of its sales to be all-electric โ€” a significant drop from the once rosier outlook. Gas and hybrid vehicles will remain a part of the companyโ€™s future for years to come.

At first, I wondered why so many automotive companies thought moving to EVs was their density. EVs are almost certainly an environmental win, if only because we can at least concentrate the pollution from cars somewhere away from people. (And that's a very conservative "if only".)

Did automotive companies like EVs because EVs are ultimately going to be easier to manufacture?

Is it because EVs are an excuse to get away from the dealership model?

Maybe it's that EVs have higher sticker prices so they bring in more profit per sale?

Is it California?

That is, I don't think anyone's making EVs to save the planet. I figured conventional automakers started making EVs to ensure they had a card to play if Tesla took off like it looked like it might, but ultimately they only do it if EVs, long-term, create more profit than ICE vehicles.

Still, it seemed like Big Oil would have something to say about this. There's simply too much infrastructure, money, and, frankly, culture tied up in providing gasoline. The entire world is configured around the value of oil. Why wouldn't oil's interests win out?

I'm not saying Big Oil is what causing what appears to be an EV downtown. If the advantage is higher prices for equivalent vehicles, it's not surprising that the market of people rich and/or fortunate enough to afford EVs (and to install home charging stations) is extremely limited. And if I live somewhere cold, I'm probably not fired up about EVs.

But I will say I'm not surprised every time I hear a company, like Mercedes, is scaling back what are, by definition, poorly crafted earlier overpromises about their EV plans.

By the way, I love how Mercedes tries to blame "the market" like they're a passive player in all this. I've noticed this move in academia -- I've read that a movement "emerges" or "is emerging" as if there were no possible explanation or alternative for the occurrence. I usually try to counter with the phrase "emerges like a beast emerges from its lair" to strip passivity & re-inscribe volition to the term.

All these overly passive descriptions connote is that the writer doesn't have a good narrative explanation yet. But we likely will later. Don't be fooled by lazy explanations like this. What part of "the market" is doing this? Maybe those flaws were always there? Why didn't Mercedes see them?

I've got a number of articles on this I've been saving to come back to at some point. Here are some.

Labels: , , ,