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Automobiles, human nature, and the challenge of building cars that people actually want

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16 minute read

From the Frontier Centre for Public Policy

By Terry Etam

Some people out there have an inner itch to do things different. Maybe it’s art, or music, or some other glorious pastime that we as the rest of humanity benefit from, far, far more than we pay. What sort of car these types drive is fascinating; usually something quirky or wonderfully weird; Neil Young spent years before he made it big driving an old hearse, various narcotics taped under the dash.

Others think completely differently, bone-dry aesthetically-speaking; thinkers who just want to make things better. Their inner guiding light is efficiency. I had a genius uncle, a farm boy who made it to high levels in national security in Ottawa through no formal education and sheer ingenuity, who would love describing how he could achieve 70 miles per gallon driving carefully and methodically and under-the-speed-limit around Ottawa in a tiny car, joyously oblivious to Type A heads exploding in his rear-view mirror.

Most people are somewhere in the middle, neither artists nor efficiency maniacs, a space that is quite comfortable for most of humanity. We like nice things, we like how they look, but we also care about practicality. We want to be different from everyone else! But just a bit, or that’s weird. And we all want to drive! Even if it is getting harder and harder for today’s youth to afford it, that drive is still there if finances allow.

This overwhelmingly dominant trait can drive the two extreme camps crazy, a battle that becomes stark and vivid in the automotive industry. Our automotive choices make a statement whether it is intentional or not, and whether we want it or not, because nothing makes a person easier to judge than their automotive preferences.

That’s a reality that people who want to change the world have to accept. It is a very hard thing to swallow, particularly for logicians who can make a near-perfect argument as to why one choice is clearly superior to another, and yet people will look you in the eye and do the opposite. (Long ago when minivans were fully earning their stripes as useful and comfortable transport, about when the perplexing stigma of minivan ownership was setting in, I watched a friend of a friend, standing five-foot-not-much, try and wrestle a mountain bike onto the roof rack of her SUV (yes, yes, I helped), and as she did so she said, “What I really need is a minivan but what would people think of me if I drove one?”)

Minivan vs. SUV was symbolic of the sheer power of how the 80-percent-in-the-middle will shape the landscape, to the extent that personal choice is allowed (hope you’re not scoffing at that, if so, see: federal 2035 all-EV mandate). Because I’m petty and juvenile, it used to fill me with scorn to see people sub-optimize such an expensive purchase on the altar of ‘what other people think of me’.

I’m still petty and juvenile, but have gained enough miles under my wheels to know that things aren’t so simple, and even if they are, it is hardly any of my business what people choose or why. Some care about resale value. Some like an available colour. Some like the feel of the steering wheel or comfort of the seats or the look of the front grille. So what.

It’s not easy for automakers either, because it’s not just that people will actually make auto purchase decisions based on some ridiculously small feature, but also that the lead time from when consumer preferences head in a new direction can be far less than the time it takes to develop a new vehicle. For example, a significant change in gas prices can lead to a preference, or abhorrence, for small, fuel efficient cars, while manufacturers won’t really be able to fully reflect this for a few years.

That’s what makes the EV ‘transition’ so fascinating. If there is one thing that is glaringly obvious in the whole topic, it is that people absolutely do not purchase ‘what they are supposed to’. You can’t make any sense out of it, because the whims and motivations come from external influences that are unpredictable. If Taylor Swift started driving a black Toyota Corolla sedan all of a sudden, what do you think would happen to black Toyota Corolla sedan sales? Not sales of grey ones though, pah! What am I, crazy? Who’d be caught dead in one of those things?

So now, particularly here in Canada but in many other jurisdictions including California, drivers are being told they will not be allowed to buy any new vehicle that isn’t EV, nor will manufacturers be allowed to sell anything that isn’t an EV.

The manufacturers are playing their part, nervously unveiling EV after EV after EV. They advertise the crap out of them, auto publications dutifully test and review them, and the media breathlessly reports how a model’s sales skyrocket by, say 33 percent, when sales go from 3 to 4 units per month.

The media also jumped all over stories about huge demand backlogs, how some new model about to enter showrooms has thousands and thousands of orders or deposits. In 2021, news widely circulated that “Ford F-150 Lightning pre-orders have been closed after nearly 200k reservations”, or Motor Trend’s “Ford Takes in More Than 44,500 F-150 Lightning Orders in 48 Hours”.

Think about how amazing that order book is. A mass manufacturer like Ford is so swamped with interest that they simply must grandiosely and loudly announce: “Sorry Sir or Madam, we can no longer take your order, our success is just too overwhelming.” Many manufacturers reported similar order-book hysteria.

It turns out that the story was surreal, but not quite as it sounds. Through all of 2022, Ford sold only 15,617 electric pickups. The headlines for 2022 results remain starry eyed and insipid: “Ford Tripled BEV Sales In December, Doubled In 2022”, although that couldn’t hold a candle to the infantile enthrallment saved for late 2023: “Ford F-150 Lightning breaks monthly sales record, doubling in November”.

Sales in November 2023 did indeed ‘double’ compared to the prior November, but in the entire quarter Ford sold only 11,905 units. In the two years after the hail-the-future order book bumper crop, Ford only sold about 40,000 F-150 Lightnings. In two years. Recently Ford announced a halving of 2024 production plans down to about 1,600 units per week, or just under 7,000 per month.

Keep in mind that in 2023 Ford sold over 750,000 F-150 internal combustion pickups in the US, and many of these go to urban dwellers for whom an EV pickup might make total sense – ones that rarely leave the city (EVs are in general far better suited to urban environments where they can scoot home safely to a nice warm private charging station every night).

Which brings us back to consumer behaviour again, that mystifying and surely exasperating trait of humanity that no amount of cajoling and ‘proper thinking’ will break. “Two hundred thousand reservations!” to “Slashing production forecasts!” In half. On a variant of the most popular vehicle in the US.

Tesla continues to dominate EV sales, and many people, when they decide they want an EV, mean they want a Tesla (in the pickup world, Rivian might be the Tesla of EV pickups, time will tell). Major auto manufacturers are having a very difficult time seeing EV sales grow to any level that would approach profitability.

It’s hard not to feel bad for them, if one can or should feel bad for huge corporations. How on earth does one plan for the coming year, when two hundred thousand consumers say yes, I want one of those, but then 80 percent change their mind by the time Ford can actually manufacture them?

But observe; whispering in their manufacturing ears are governments saying not subtly that “Don’t worry, we will be legislating internal combustion out of existence, just build them and they will come…” Said less loudly is the supporting evidence: “because they have no choice.” Well, it worked for a while in the Soviet Union didn’t it?

Making things even more complicated for manufacturers are upcoming elections in the US (this year) and Canada (what feels like an eternity but is really only 1.5 years) that could see either minor or major revisions to EV policy rollouts of the past few years.

But forget all the uncertainty surrounding manufacturers; that all gets trumped (no pun intended) by the human element. Here’s an important realization that we all need to accept: Some stuff just gives us a sense of belonging with others in a way that is critical to mental well being. Some people like to dress in the latest fashion. Some get the most popular hair styling. Some drive a rugged SUV because of what it says about them.

That can make manufacturers pull their hair out, because something illogical might be their biggest hit ever. But on top of that one must now layer the rancid decay of politics. EV sales seem to be falling along political fault lines, which in a way is not surprising: one side of the political spectrum sees climate change as a moral imperative to be dealt with as rapidly as possible, and that element, to the extent it can afford it, is responsible for the highest uptake of EVs (it is another sign that ‘left wing vs. right wing’ is a historical anachronism of little value any more; the traditional ‘left’ represented the working class, the downtrodden, the ones that needed a safety net; today’s main EV purchasers are wealthy enough to pursue Teslas first and foremost, often with a multi-car garage full of options). EV as political statement is yet another example of how our preferences link us to a tribe of our choice, rational or not, and it will be supra-humanly difficult to change that, whether in Canada or the US or Togo.

All one can conclude from this hodgepodge of observations is that the auto market will continue to reflect certain aspects of human nature that we may not even be aware of ourselves, and also reflect physical, financial and security realities/rationales that will not be changed by government edict. I have no idea what that means in terms of a transition to EVs, and that trajectory could change with the development of new battery technology, for example. But at present, it should be clear, based on examples like the Ford F-150 Lightning EV experience, that human enthusiasm and professed care does not necessarily translate well into the cold hard reality of what people put their money down on.

It is a nuanced world. People are imperfect and beautifully so, it adds colour to the world. Either the landscape is more or less free, where people express themselves as they wish, or it is a closed quasi- or full-dictatorship where that is not permitted (see: censorship, over-reaching legislation, thought police/moralistic systemic governmental intervention, personal carbon budgets, etc.). The latter never succeeds because it fights human nature, and the former has elements that make no sense outside one’s own circle of people that get it. I choose not to be part of some tribes, but I probably choose to be part of others, and likely do so subconsciously, which makes the whole thing even trickier.

Current politicians and WEF-types believe they have a blueprint for humanity to unroll. It is an absurdity, if for no other reason than they can’t comprehend the complex realities of 8 billion people whom they are trying to force in a certain direction. They are trying to force them all into metaphorical minivans, because minivans make more sense than anything else. They will fail.

Terry Etam is a columnist with the BOE Report, a leading energy industry newsletter based in Calgary.  He is the author of The End of Fossil Fuel Insanity.  You can watch his Policy on the Frontier session from May 5, 2022 here.

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Automotive

Biden’s Ambitious EV Charging ‘Fantasy’ May Be On A Collision Course With Reality

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From the Daily Caller News Foundation

By NICK POPE

 

President Joe Biden has pledged to install 500,000 public electric vehicle (EV) chargers around the U.S. by 2030, but logistical hurdles may be too much to overcome.

The Biden administration landed $7.5 billion to build out a network of public EV charging stations around the country in the bipartisan infrastructure package of 2021, but those funds have only led to a handful of operational charging stations to date. Transportation Secretary Pete Buttigieg reaffirmed the administration’s goal to build 500,000 chargers with the money by 2030 during a May television appearance on CBS News, but challenges like adding transmission lines, navigating the permitting process and coordinating with utility companies figure to make the goal improbable.

As of April 1, the administration’s $7.5 billion push had only led to seven operational charging stations combining for less than 40 chargers around the U.S., a pace that has drawn criticism from House Republicans and even Democratic Oregon Sen. Jeff Merkley. While other projects are on their way to being built and operational, the nation’s EV charging infrastructure remains mostly concentrated in more densely-populated, coastal areas of the country, according to the Department of Energy (DOE).

While results have been slow to materialize, federal funding should be sufficient to build approximately 25,000 charging spots at about 5,000 stations, according to Atlas Public Policy, a policy analysis organization that focuses specifically on EVs. In order to reach those figures by 2030, the administration’s funding will have to spur the construction of more than 900 stations each year until then, a big step up from the program’s output of less than 10 stations over nearly three years.

“Our programs are accelerating private sector investment that puts us on track to deploy 500,000 charging ports well ahead of schedule and continue to expand a convenient and reliable charging network,” a Department of Transportation spokesperson told the DCNF. “There are currently projects underway in partnership with states and local grantees for 14,000 federally-funded EV charging ports across the country under the [National Electric Vehicle Infrastructure (NEVI)] and [Charging and Fueling Infrastructure (CFI)] programs that will build on the 184,000 chargers operational today.”

Of the 184,000 chargers in operation today, more than 107,000 were already in circulation as of 2020, the last full year before the Biden administration took office, according to the DOE. Moreover, there are only about 10,000 fast charger stations in the U.S., a number that EV proponents would like to see increase to alleviate the public’s concerns about EV range and recharging wait times, according to The Washington Post.

Some of the biggest logistical hurdles are ones that may not be immediately obvious, such as enduring the process of building out needed transmission lines and upgrading existing utility infrastructure to accommodate hundreds of thousands of new chargers, according to experts who spoke with the Daily Caller News Foundation about whether such a number of chargers will be operational by 2030.

One skeptical expert is Dr. Jonathan Lesser, a senior fellow at the National Center for Energy Analytics and president of Continental Economics. Lesser estimates that “hundreds of thousands of miles” of new transmission lines will be needed to deliver enough electricity to the right places to meet the administration’s goal, a tall order given that the U.S. managed to complete less than 700 miles of transmission projects in 2022, according to data aggregated by Statista.

Lesser wrote his own analysis of the challenges the administration’s EV charger push faces for The Hill on Monday.

“The administration’s efforts to mandate EVs without considering the physical infrastructure to charge them (to say nothing of the cost), not only highway charging stations but also the necessary upgrades to millions of miles of local distribution circuits and transformers for home charging – is either an exercise in green virtue signaling or a cynical effort to restrict Americans’ mobility,” Lesser told the DCNF. “If EVs are the wave of the future then consumers will purchase them without the need for mandates and the private sector will develop the necessary infrastructure, just as it did a century ago and just as Tesla has done for its vehicles, without the need for government intervention.”

“If all those chargers were in place, you would need hundreds of thousands of large transformers and transmission lines along highways to provide the electricity,” Lesser continued. “You would also need linemen to install everything – and they are already in short supply. Of course, none of this addresses the issue of where the electricity comes from – if it is to be from renewables (e.g., wind and solar), there would have to be a massive building effort.”

Lesser believes there is “not a chance” that the 500,000 charger goal is met by 2030, and added that Buttigieg’s suggestion the administration will reach that target amounts to “pure fantasy.”

In addition to the billions of dollars meant to subsidize public charging infrastructure, the administration is also spending big to help manufacturers produce more EVs and to blunt the higher costs of EVs for consumers. Further, federal agencies have also promulgated aggressive fuel economy standards and tailpipe emissions rules that will force significant increases in EV sales over the next decade for light-, medium- and heavy-duty models.

Energy Secretary Jennifer Granholm described the chargers covered by the $7.5 billion program as “the hardest ones because they’re going to places where the private sector hasn’t gone because there’s no electricity, because they’re remote” at Politico’s 2024 Energy Summit remarks on Wednesday.

Aidan Mackenzie — an infrastructure fellow at the Institute for Progress with particular expertise covering energy, transportation and housing policy — agreed that logistical challenges are likely to hinder the administration’s goal for charger deployment by 2030. Specifically, he highlighted securing complementary infrastructure, like transmission lines, as likely to sap time and resources away from the effort to construct a national network of public chargers.

“It seems like it’s going to be hard to meet this target,” Mackenzie told the DCNF. “Different utility regions do not necessarily have an incentive to plan or build large capacity transmission lines that share power. They often interrupt the way that utilities want to control the generation in their region. So, I would very much expect that to be the binding constraint.”

However, Mackenzie added that the administration could achieve the desired results of its $7.5 billion program and its broader goal of 500,000 charger goal if regulators and builders are able to develop “muscle memory” in the earlier stages of rollout so that officials from both sectors can more easily and quickly navigate complex processes in the near future.

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Automotive

Current EV strategy charging ahead to failure

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Dan McTeague  Written By Dan McTeague

For years now I’ve been saying that electric vehicles, and EV mandates, are bad for Canada.

Back in 2020, when the then-CEO of Toyota, Akio Toyoda, voiced his concerns that governments were moving too fast in their push for an all-electric car market when there were other good options available which didn’t require the same multi-billion dollar infrastructure overhaul or increase in electricity generation, I asked why we weren’t listening to a man who knows his own business.

When Europe found itself in an energy crisis in the winter of 2022, and the Swiss government asked its citizens to avoid driving their EVs, even considering an outright ban, to protect their fragile electricity grid, I said that with our already-strained grid we were seeing our future playing out before us in Switzerland and mandates or no, consumers just wouldn’t stand for it.

And more recently, as stories have piled up of EVs’ vulnerability to the cold — “We got a bunch of dead robots out here,” as one frustrated EV owner put it, surrounded by frozen EVs that had run out of juice while waiting for a charge in a cold snap — I’ve asked over and over again, why on earth our government is trying to force the large scale adoption of an automobile technology which functions so poorly in a normal Canadian winter.

I take no pleasure in being proved right, but nearly every day brings about a new story of EVs failing to meet the lofty expectations our leaders have set for them.

  • Recent headlines have trumpeted the difficulties EV drivers are having getting their cars fixed, because so few mechanics know how to work on them.
  • People are finding that the resale value of their EV is falling at a much faster rate than their neighbour’s reliable internal combustion engine vehicle.
  • Rental car companies like Hertz have been taking major losses after over-investing in EVs, that no one wants to rent. Apparently people don’t like the idea of pinning their vacation on a car they might not be able to charge.
  • And major auto manufacturers have been significantly scaling back their annual EV production, despite impending mandates which will force consumers to buy their product in just over a decade.

Even with the generous government subsidies handed to Ford in order to produce made-in-Canada electric SUVs, that company has decided to push their release date for the vehicles back two years — a decision that means layoffs for the majority of the 2,700 workers at the plant, according to the Globe and Mail. GM has followed suit, with recent  reports  claiming that they are “having a second look” at plans to build EV motors at their plant in St. Catherines, Ontario.

Those companies are beginning to accept reality, something various nations around the world have started to do, as well. The U.K., Germany, Italy, and other European countries, as well as the U.S., have had resistance to EV mandates play a big role in their politics lately. The Biden campaign was even forced to issue a statement saying, “There is no ‘EV mandate,’” after Donald Trump predicted to Detroit autoworkers that the White House’s pro-EV policies would put them out of work.

In the face of all of this, the Trudeau government continues to double down, reaffirming mandates and shovelling more and more tax dollars into the EV fire.

They should know better.

And maybe they do.

But maybe the dollars and the promises to their activist friends have just gotten so big that they feel like they can’t change course now.

Or maybe they are just too stubborn to admit that people like me were right all along, that they bet big and they bet wrong. And they can’t say they weren’t warned.

Buckle up.

Dan McTeague is President of Canadians for Affordable Energy

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