EVs Competition
EVs Competition
China's EVs sail to Europe, breaking shipping barriers; Tesla slashes Model Y price in US, braces for BYD rivalry; Arrival EV maker collapses
UPDATES: In 2024, Chinese electric vehicle (EV) makers are making significant strides in Europe, marking a symbolic year for the birthplace of the automobile. The arrival of BYD's first large car shipment via roll-on/roll-off (RORO) ships in the Netherlands and Germany signifies a pioneering move, addressing transportation bottlenecks that have hindered the expansion of Chinese EVs in Europe. This development comes as Chinese EV companies, facing limited shipping capacity, rush to secure transportation for their vehicles, driving up charter fees
In a post on X, the Tesla CEO said the automaker would offer a $1,000 discount on the Model Y through February because people “don’t love to buy cars in the middle of winter."This move to lower prices coincides with the rise of Chinese automaker BYD as a formidable competitor, recently surpassing Tesla as the world's top seller of electric vehicles and aiming for expansion into key markets like Europe.
Arrival, which has a decade of history, has entered administration, the British version of a bankruptcy filing. In theory, the move only impacts the company's assets in the United Kingdom, but that's functionally the entire company.
New BYD cars wait to be loaded onto the BYD Explorer No. 1 for its maiden voyage in Yantai, in eastern China's Shandong province, on Jan. 10. (FeatureChina via AP) (Taken from NikkeiAsia)
EVs set to make bigger splash in Europe with huge new ships
By EIKI HAYASHI, Nikkei staff writer
2024 could go down as a symbolic year for the birthplace of the automobile as Chinese electric-vehicle makers' first big car ships arrive in Europe.
Later this month, the first of the roll-on/roll-off (RORO) ships ordered by leading Chinese EV manufacturer BYD will stop at ports in the Netherlands and Germany.
The 200-meter-long BYD Explorer No. 1 left southern China in mid-January, carrying more than 5,000 EVs on a voyage taking it around the Cape of Good Hope.
This marks a pioneering move for BYD and for China's EV industry, which has lacked such transport capacity.
China became the world's top auto exporter in 2023, shipping 4.91 million vehicles worldwide, but their presence in Europe remains relatively small. Although Chinese autos have made gradual gains, with a roughly 3% market share, they trail Toyota Motor and Hyundai Motor.
Transportation bottlenecks have held them back. Major Chinese EV makers, mostly newcomers, have lacked their own dedicated charter vessels like Toyota's. They have needed to secure space for their vehicles on shipping lines, but China's car transport capacity is only a little under 3% of the world's total.
Chinese EV companies have rushed to fill limited slots. This demand helped drive up the average daily charter fee for 2023 to a record high of $115,000 -- seven times the pre-COVID level of 2019.
To bypass this competition, BYD plans to secure eight RORO vessels within two years, each capable of carrying 7,000 EV units, for its own exclusive use. Rival automaker SAIC Motor ordered its own vessel that set sail for Europe in January.
"We certainly expect an increase in 2024 from Chinese models to smash one of the largest hurdles so far, a lack of appropriate shipping vessels," German auto analyst Matthias Schmidt said. "The market environment will be also changing dramatically."
China's influence can already be felt in the European auto industry. Mercedes-Benz Group's top shareholder is state-owned Chinese automaker BAIC, followed by billionaire Li Shufu, chairman of nonstate Chinese automaker Zhejiang Geely Holding Group. Together, their stakes add up to nearly 20%. Geely is also the parent of Sweden's Volvo Cars.
Volvo Cars has announced that it would stop funding its Polestar electric-car brand and may exit the unit with a sale of its stake to co-founder Geely.
"Geely has great technical and design capabilities," Volvo Cars CEO Jim Rowan said. "Whether it is a Chinese company or not is not important."
Chinese players are also key links in Europe's EV supply chain. Top European auto group Volkswagen has launched an automotive battery company but still depends on China's Gotion High-tech for battery development and manufacturing. EVs are becoming increasingly difficult to produce without Chinese companies, which hold 60% or so of the global market for automotive batteries.
For policymakers, such ties present a dilemma. The European Union is investigating whether Chinese EVs, which are around 20% to 40% cheaper than similar models from major European carmakers, are harming competition -- a move that could lead to import restrictions. On the other hand, low prices are essential to the EU's goal of popularizing EVs.
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Taken form Business Insider
Tesla knocks $1,000 off the price of its Model Y cars in the US to boost sales
By Tom Carter
Elon Musk just announced another Tesla price cut.
In a post on X, the Tesla CEO said the automaker would offer a $1,000 discount on the Model Y through February because people “don’t love to buy cars in the middle of winter."
“This is the essential quandary of manufacturing: factories need continuous production for efficiency, but consumer demand is seasonal,” he added.
The price cut applies to the Model Y rear-wheel drive and long-range versions sold in the US, which now cost $42,990 and $47,990 respectively, but not to the “performance” variant, per Tesla’s website.
It's a temporary discount, however. Model Y prices will rise again on March 1.
The Model Y, which Tesla first unveiled in 2019, is the company's most popular model and accounted for around one-third of all EV sales in the US last year, per data from Kelley Blue Book.
Tesla has cut prices several times in the past year as EV demand slows and it attempts to fend off competitors.
The latest price cut kicks off a pivotal year for the automaker. Elon Musk warned investors in last month’s earnings of a sales slowdown. And the company is also preparing to ramp up production of an affordable mass-market EV codenamed “Redwood.”
The billionaire warned Tesla workers to expect a grueling version of the firm’s famed “production hell” and that they would need to sleep and live on the line to build the car.
The push to make its cars cheaper comes as Tesla faces the looming threat of real competition in the form of Chinese automaker BYD.
The Warren Buffett-backed company overtook Tesla as the world’s top seller of electric vehicles at the start of the year, and is now eyeing expansion into Europe, one of Tesla’s key markets.
Tesla did not immediately respond to a request for comment from Business Insider, made outside normal working hours.
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Tesla electric vehicle rival files bankruptcy, begins liquidation
By Daniel Kline
There's a reason very few new automakers have been launched over the past 40 or so years. Building and selling cars takes a tremendous amount of infrastructure.
When you add in having to create not just a new design, but a new method of powering your car, you see why big auto has generally been a closed club. Tesla (TSLA) , of course, has crashed that party, becoming the first startup electric vehicle manufacturer to operate at scale.
You can credit that to the genius and drive of Elon Musk. It may have been lost in his recent conversion to a conspiracy-theory-embracing, far-right internet troll willing to say anything so people pay attention to him, but Musk has been the leading entrepreneur of his time.
He has been a serial disruptor willing to take on industries that have a scale that generally gives them a moat against all competitors. Building a car company from scratch has generally been impossible but building one to sell EVs, a product where demand has always been suspect, was impressive even if Musk's recent actions have taken attention away from his accomplishment.
Big Auto has generally crushed any upstarts simply because of scale. Tesla's case, however, continually looks like an outlier as multiple EV companies have failed and others, like Lucid, have struggled to meet production goals.
Now, a once-hopeful player in the EV space, which once had a $13 billion valuation, has filed for bankruptcy, or at least the British equivalent of it, without selling a single car.
Arrival EV maker enters bankruptcy (administration)
Arrival, which has a decade of history, has entered administration, the British version of a bankruptcy filing. In theory, the move only impacts the company's assets in the United Kingdom, but that's functionally the entire company.
Instead of making just passenger cars, Arrival sought to build a large van, a bus, and a car that was being positioned for use by ride-hailing companies like Uber and Lyft. The company's XL Van, which sort of looked like a more-cheaply-made version of the Mercedes Benz Sprinter, appeared to be its signature product.
The company had bold goals, according to its website.
"At Arrival, we are reinventing both the design and production of electric vehicles for end-to-end sustainability. Only true innovation of both products and processes can deliver the radical impact we need to combat the worst effects of the climate crisis," it shared.
That was a big goal for a company that never sold an actual vehicle.
The company, which listed its stock on the Nasdaq, had recently been informed that it was being delisted.
What's next for Arrival?
After a promising start, which included backing from Hyundai and United Parcel Service (UPS) placing orders for its delivery van, it appears that Arrival will be sold for parts.
"Simon Edel, Alan Hudson and Sam Woodward of EY-Parthenon’s Turnaround and Restructuring Strategy team were appointed as joint administrators (the 'Administrators') of Arrival UK Ltd and Arrival Automotive UK Limited (the 'Companies'), both subsidiaries of Arrival," the company shared in a press release.
It appears that the company's 170 workers in the UK will lose their jobs.
"The Administrators are now exploring options for the sale of the business and assets of the Companies, including the electric vehicle platform, software, intellectual property and R&D assets, for the benefit of creditors," the company continued.
Arrival has been bleeding cash since 2021, and despite taking in $50 million in new money in 2023, it has run out of money before it sold a single vehicle.
The filing follows a number of other EV companies that have gone bankrupt. That includes another British company, battery maker Britishvolt; Proterra, another EV battery maker; Sweden's Volta Trucks, and Lordstown Motors, which intended to make EV pickup trucks.
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