It would be nice to believe that super smart people were overseeing America’s conversion to electric vehicles. The expectation seems reasonable given that President Biden and the “progressives” he answers to want to eliminate a century old technology that allowed Americans from all walks of life to own a set of wheels. Until Henry Ford opened the Model T assembly line in 1913 that reduced the cost of the vehicle to $260 from $825, America’s masses relied on horses and buggies.
My bubble was burst with the sinking of Felicity Ace, a massive ship transporting some 4,000 luxury cars that sank last March about 253 miles off the Azores after some of the vehicles on board caught fire. Electric cars were among the vehicles being transported; while it isn’t known that the EVs ignited the fire, the ship sank because no one thought to outfit it with the specialized equipment needed to put out an electric vehicle fire. As reported by the New York Times, the sinking damaged the unique ecosystem of the Azores, the Portuguese archipelago in the North Atlantic, home to sperm whales, blue whales, humpback whales, dolphins and sharks, among other species.
The ecological disaster should have been a blaring wakeup call round the world that electric vehicles require specialized care and handling when they catch fire, as they are known to do. The message never reached the town of Hamden, CT, which in July was forced to pull its entire fleet of electric buses off the road after one of them caught fire and was destroyed. According to a report in the Hartford Courant, the Hamden garage for the electric buses was not fully equipped with the fire suppression tools required by the Department of Transportation.
Think electric bus fires are a rare occurrence? Think again.
A week ago, I had a eureka moment about EVs while driving to pick up an Uncle Leo’s bagel sandwich at Wexler’s Deli in Santa Monica. As I recently posted, I noticed a slew of Tesla Superchargers under construction just off the highway and then a city block full of them under construction about a mile away. Based on everything I’ve read and enthusiastic reports from my cousin Rob, the Superchargers are reliable and are deserving of their name given the speed with which they can electrify a vehicle.
What I’ve also learned is that rival public charging stations aren’t ready for prime time. Detroit Free Press writer Mark Phelan did an admirable job writing about the horrors he’s experienced, and a recent J.D. Power survey confirmed that public chargers are grossly inadequate. Underscoring their inadequacy, a recent Car and Driver interstate driving test with a Lucid revealed that multiple charging stations along the route were inoperable, requiring more stops along the way that wouldn’t have been required if they were in working order.
Said Car and Driver about Electrify America, which is owned by Volkswagen: “Electrify America recently raised $450 million to expand its network, but the cash might be better spent ensuring the current equipment works.”
No clear path to profitability
What threw me for a loop this morning was this Wall Street Journal story about EV charging companies getting into the advertising display business. Buried in the story was this gem: “In the next five to seven years in the U.S., there are going to be lots of runs at different business models to try to make the charging service profitable,” said Nick Nigro, founder of tech consultancy Atlas Public Policy. “[Advertising] could add some much-needed revenue to a business that doesn’t easily break even just selling electrons.”
It’s alarming that the businesses responsible for the infrastructure required to make electric vehicles feasible have not yet figured out a path to profitability, particularly given that the Biden Administration wants EVs to account for 50 percent of the vehicles on the road by 2030. Selling electrons apparently is no more profitable than selling gasoline. Most gasoline station owners make their profits from selling soft drinks and junk food.
EV charging companies haven’t yet perfected their technology or their equipment. Phelan, the Detroit Free Press writer, said Electrify America charged his credit card twice for a single charging station. Then there’s the growing issue of cord cutting electric charger vandalism, which has been particularly acute with Tesla Superchargers, some of which have been targeted multiple times. I’d expect brilliant Elon Musk would have anticipated and already solved this issue. I’ve never read about gas hoses getting cut.
The assumption is that public charging stations will improve over time, but that requires an unjustified leap of faith. Electrify America was founded by Volkswagen in 2017 as penance for its emissions scandal, so it’s had five years to get things right. Yet it still ranks low in terms of customer satisfaction, with no improvement year-over-year. Notably, its owned by Volkswagen, which was among the first automotive companies to embrace electric vehicles.
Buttigieg and Granholm Duo
The Biden Administration has allocated more than $5 billion to help states accelerate building out national EV charging stations, a program overseen by the U.S. Departments of Transportation and Energy. The Transportation agency is overseen by Pete Buttigieg, whose last job was mayor of South Bend, a city converting to natural gas-powered buses thanks to a $4.3 million grant from DOT. If Buttigieg has any EV experience or training, I can’t find it.
The Department of Energy is overseen by Jennifer Granholm, who was widely regarded as a disaster when she served as governor of Michigan. More importantly, she has accumulated an extensive list of green energy boondoggles. A tag team of Buttigieg and Granholm overseeing the buildout of America’s already troubled electric charging network is cause for great alarm.
It’s a wonder how any automotive company can be taken seriously as an EV manufacturer without following Tesla’s example of building its own national and reliable charging network, particularly Ford, whose CEO Jim Farley says “customer experiences are the future of the automotive industry.” Ford just signed a deal with low customer satisfaction rated Electrify America to provide free fast charging for buyers of the company’s F-150 Lightning electric pickups.
Inflation Reduction Act?
Farley also just raised the cost of his electric Mustangs by $8,000 and weeks ago raised the cost of his Ford Lightnings by a similar amount. Destination and delivery charges also are expected to rise on the electric Mustang, which is assembled in Mexico at plants where factory workers are paid just over $3 an hour and live in poverty.
It appears that buyers of Farley’s electric Mustangs and Lightnings are eligible for $7,500 tax breaks, so it’s comical that the subsidies are courtesy of legislation dubbed the Inflation “Reduction” Act. Farley received more than $100 million from Michigan Governor Gretchen Whitmer to retool a factory in Ford’s headquarters city of Dearborn to manufacture the highly profitable Lightning.
Farley is quite the salesman, with politicians and the media worshipping the ground he walks on. He’s a real-life Matt Foley, the motivational speaker played by his late cousin Chris on Saturday Night Live, although the Ford chief, who was paid $23 million in compensation last year, owns luxury homes rather than living in a van down by the river.
Problems in China
I was also alarmed to read that Tesla and another electric car manufacturer were forced to shut their charging facilities in Sichuan province because the nation’s worst drought since the 1960s has slashed hydropower generation while a punishing heatwave has sent electricity demand surging. China’s Communist government has done a remarkable job overseeing electric vehicle conversion, birthing a vibrant and competitive national industry. Nine of the top 10 EVs sold in China are made domestically, all of them Chinese owned except Tesla.
Although China has pledged to cut emissions, the country’s leadership understands the importance of ensuring a reliable grid. That no doubt is why China in the first quarter of this year approved construction of 8.63 gigawatts of coal power, nearly half the amount of coal construction in all of 2021.
Meanwhile in America, we have geniuses like Michigan’s Whitmer who allowed the closure of a nuclear power plant that provided 15 percent of the state’s clean energy. Texas, a state for which I have higher expectations, is experiencing a severe strain on its grid because it’s literally tilting at windmills. In California, where governor Gavin Newsom talks a good game about environmentalism, he nevertheless refuses to impose a wealth tax to pay for his initiatives.
In my mind, if someone’s in the market for an electric vehicle and has substantial financial means, Tesla is in the only game in town and quite possibly will remain so for the foreseeable future until a reliable national charging network is built. I’m doubtful that Ford and GM can successfully manufacture safe and reliable electric vehicles, so likely the U.S. will have to rely heavily on imports for lower cost vehicles.
Driving a Tesla requires an acceptance of dramatically lower fit and finish standards, particularly as the vehicle ages. Yesterday I passed a Tesla Model S with a bumper held together on both sides with duct tape. The car didn’t appear to have been in an accident, as there were no dents or major scratches. The Model S currently has a base price of $106,440.
What’s clear is the Biden Administration has no well thought out master plan on how to achieve its ambitious electric vehicle conversion goals. It’s a wing and a prayer strategy that could potentially result in the elimination of gas engine vehicles, but electric vehicles would be so costly that only the rich could afford them. A return to horse and buggy days doesn’t seem far-fetched.
Barack Obama reportedly once said, “Don’t underestimate Joe Biden’s ability to f— things up.” Biden is well on his way to proving Obama knew what he was talking about.