The Reverse Hockey Stick -- Foreshadowing The EV In America -- It's Costing Ford $64K For Each EV It Sells -- June 25, 2024

Locator: 48037EVS. 

Tag: tipping point.

Updates

Later, 4:38 p.m. CDT: Solaredge plummets today -- drops 21% today; almost 90% over past year --

Later, 3:24 p.m. CDT: and then we have this, noted after the VW-Rivian story below -- link here.

This story was posted mid-day today -- didn't do a thing for F's stock price. The losses must have been huge for Ford to do this abruptly. Or so it seems. I imagine the boardroom becomes a bit animated when the subject / agenda moves on to EVs. Even the Biden administration is no longer talking about EVs -- in the final months of the presidential campaign. Link here to the Argus Media story.

Later, 3:18 p.m. CDT: Volkswagen thinks different. Just announced. VW takes a $1 billion stake in Rivian. For the moment, the cash infusion likely saves Rivian from an alternative outcome. I have no idea what VW gains from this deal. It's not as if Rivian is doing something VW can't do, and it's not as if Rivian has a global dealer network selling EVs. My hunch: VW needs Rivian to meet California EV standards due to go into effect in 2035 or thereabouts. Sort of like buying forest land to pay for carbon credits. Rivian is nowhere near making a profit, according to Phil Lebeau, June 25, 2024.

Original Post 

The natural progression of "things" -- the "S-shaped curve."

Early adopters --> tipping point --> exponential growth --> general acceptance and sustainability.

Tesla Model S was in mass production in 2012. By then end of the decade, 2022, EVs should have taken hold and been in their "exponential growth stage."

That did not happen, but even more concerning: the all-important "tipping point" was never reached. 

It's hard to define a "tipping point" but in the case of EVs, I would argue that the tipping point is when consumers are clamoring for better infrastructure to meet their needs, and either the private sector responds, or the Federal government goes "Manhattan Project" for EV infrastructure. 

I've seen no headlines  in the past year or so about EV infrastructure, i.e., charging stations, which suggests there are more than enough charging stations for EV consumers. Which means that that tipping point for EV acceptance in the US has not materialized. And without reaching a tipping point, one will never see exponential growth.

By the way, has anyone seen any mega-EV-charging stations -- the kind that Pilot Flying J or Buc-ee's might build? Nope. None. Zilch. Nada.

Investors put their money where they will see a return, and it's not EVs. Or charging stations. Right now, it's Nvidia blades and humongous data centers. 

But there's more to the story. Could the classic "S-shaped curve" be replaced by a hockey stick, and not in a good way?

Tesla seems to be on a treadmill -- on that part of "S-shaped curve" that is flat, really flat. The hockey stick: nah, folks argue, it couldn't happen that fast. 

Hold that thought.

First, does the Cybertruck have a future? Will it simply fade away? Seriously, who is buying a Cybertruck? Certainly not contractors, unless they have a need to get from zero to sixty in just 2.6 seconds. Acceleration when red goes to green at the intersection doesn't seem to be the focus home builders these days. Certainly not in Texas. 

I've thought about this for the past six months, wondering whether the curve could become a reverse hockey stick, and then today, this story.

One can stop reading here, but reading that article brings up even more points for discussion.

The writer clearly does not "get it." He does not get the fact that Americans don't want EVs, something we've discussed for quite some time. How do we know (that he doesn't "get it")?

Because of the questions he asked:

As we face the death of Fisker, it seems worth asking: Was its sole product ever really worth a damn? Did it have the potential to be a contender? Was this a fundamentally decent car plagued by bad decisions/management/quality? Or was it fundamentally flawed? Might Fisker have succeeded if they sold the cars with the latest software update and promised features from the start?

LOL. Latest software update; promised features? 

This writer didn't even talk about cost / price. $50,000. And Fisker was considered "moderate" in price.

But the real problem: Americans don't want to be tethered and they don't like batteries. 

Anyway, enough for now. 

By the way, EVs came up very, very, very briefly on CNBC's "Half-Time Report" when Tesla was very, very briefly mentioned. The analyst soundbite: ".... sure, maybe someday ... but no time soon .. look up 'dead money’ in Funk and Wagnalls and you will see a photo of a Fisker parked in front of the NYSE."

Not exact comment; paraphrased.