The Biggest Story Of The Day -- No, Not Belichick -- January 11, 2024

Locator: : 46516EVS.

From earlier today:

Bitcoin ETFs: approved by SEC. Think back on comments by Jamie Dimon and Charlie Munger. On wrong side of history. Huge day for ARKK. Cathie Wood on a roll: could put gig economy on steroids. 

Cathie Wood continues to defend Tesla despite recent decision by Hertz to downsize its Tesla inventory, to sell one-third of its EV inventory. Cathie Wood was disingenuous when responding to the Hertz development. Cathie Wood says it's all about educating the American population. There is a huge difference among a) riding in an Uber Tesla and b) buying a Tesla and c) renting a Tesla. I won't do "a, b, or c." Rich folks will pay up for an Uber Tesla, but except for niche situations, EVs have lost their luster. I can't even imagine taking a chance driving from north Texas to Flathead Lake in Montana in January in a Tesla: 1,771 miles divided by 300 mile-range = six (6) re-charging stops each direction. 

 

Joe Keenan calls GM’s EV division a joke — says GM sold one EV in period when Tesla sold 100’s of thousands: some hyperbole but sentiment in right place. Fact check here. Not as bad as Joe suggests. Actually worse when you dig through the numbers. And then there’s the “snow problem.”

The biggest story. today, without a doubt, and somewhat underplayed by CNBC and completey dismissed by Cathie Wood was the announcement that Hertz rental will sell one-third of their EV inventory and use the proceeds to ... drum roll ... buy ICE vehicles. 

Holy mackerel.

This pretty much confirms the EV story.

Link here to The WSJ which minces no words with regard to this debacle. From the linked article:

The move is the latest example of a swift retrenchment by the car business on EVs. After years spent outlining aggressive expansion plans, automakers in recent months have put some EV projects on ice and dialed back production forecasts, citing signs that U.S. consumers aren’t ready to move to cars powered exclusively by batteries as quickly as once thought. The car industry’s effort to sell consumers more broadly on EVs has run into some resistance lately as automakers have largely exhausted the pool of early adopters who tend to be willing to take a chance on new technology.

EV sales in the U.S. increased last year but the pace of growth has slowed. Car buyers are worried there won’t be enough places to plug in or their travel will be too limited by battery range, surveys show. High prices also are turning off consumers.

Hertz shares fell about 4% in afternoon trading Thursday. Tesla shares were down about 2.7%.

Hertz signaled its big push into EVs in 2021, with a surprise move to eventually purchase 100,000 Tesla EVs. The Estero, Fla., company, which months earlier had emerged from bankruptcy, pegged part of its turnaround story to the effort to broaden electric choices for customers.

“Electric vehicles are now mainstream, and we’ve only just begun to see rising global demand and interest,” said Mark Fields, a former Ford Motor chief executive, who was then serving as Hertz’s interim CEO. Hertz’s stock rose 10% that day, and helped send Tesla’s valuation above $1 trillion for the first time.

Hertz pushed further into EVs under its current CEO Stephen Scherr who took over in February of 2022. A few weeks later, the company said it agreed to buy 65,000 cars from Swedish EV manufacturer Polestar.