Look at profits of legacy auto. It’s not the labor, they’re prioritizing profits over investment to deliver on EVs (kicking the can and making it the future’s problem).
There is also the choice of whether or not they make affordable cars.
In the 1970s my dad had the worst time trying to buy compact cars from US dealerships, in the 2000s I thought US automakers were as bad but Japanese brands were better, by 2018 or so Japanese dealers were using the same toolbox (“You’re saying I can’t buy a Honda Fit because the factory washed out in a flood but you have 100 SUVs in a row that nobody wants to buy made in the same factory?”)
Then I got home and I am sure to read some article in the auto press which repeats, like the brainwash soldiers from The Manchurian Candidate that Americans only want to drive huge vehicles. Sure, an American might want a size L vehicle on average but from their point of view it is a disaster that somebody would could possibly buy a $50k vehicle walks out with a $25k vehicle (that Sales Manager won’t be able to work you over for another decade) so they will try to sell you an XXL vehicle.
Tesla, GM, Toyota and many others have refused to make affordable EVs, it’s that simple. Their hope is that a 100% tariff on BYD means they’ll never have to service the affordable vehicle market.
You're missing one of the principal actors here. It's not GM or Toyota selling you a car, it's a dealership. The dealership is only viable if they average $2-4k per sale. That margin simply doesn't exist on a $10k car, so they don't even want to offer it except to get you in the door.
Manufacturers in turn (except Tesla) have no one to sell these vehicles, and would have to take a risk that they could make up the lost margin on volume. They don't have the cultures to do that either.
I would be thrilled to pay 12-14k for a cheap electric car with moderate range, rather than 50-100k for an expensive one with 50-100% more range and all the bells and whistles.
Existing contracts aren't structured as a lump sum they can just tack on some margin for and dealers don't fully control their margins. There's half a dozen "incentives" that are given as percentages of sale price plus whatever additional fees they can throw on that need to equal that margin. It's not that these are impossible problems, but they require coordinated action in an industry that's full of mutually hostile parties.
>Tesla, GM, Toyota and many others have refused to make affordable EVs, it’s that simple.
I think GM is at least trying, with the sub-$35,000 Equinox EV. And the rumor is that the 2026 Bolt will be ~$30,000. Definitely going to be interesting to see what comes around in the next couple of years with battery prices falling.
Taking just Ford, they sold 1,995,912 vehicles in 2023 [1]; assuming it's divided evenly across vehicles, CEO compensation adds $13.25 to the price of a Ford. Probably CEO compensation is less substantial for a BYD vehicle, but it's just not a large component of the cost.
EDIT: Fixed the math, thanks mperham, I had $1.35 earlier.
Just FYI, they will choose a component that is 1 cent cheaper over the one that worked for years without any problems. They could give you an actual usable navigation but they don't want to spend 1 extra dollar for the controller.
The OP said "Look at profits of legacy auto. It’s not the labor, they’re prioritizing profits over investment [...]". Are you arguing that this is incorrect by showing some examples of large labor expenses these US auto companies have? My understanding is that profits is what is left over to be paid to shareholders after they stop spending on employees/investment/opex/etc.
Hybrids have become increasingly popular as the charging infrastructure is still lacklustre in many parts of the world. And that's not a problem that can be solved overnight.
Even if EV charging was ubiquitous, legacy auto would sell what nets them the highest profit, which is not EVs. China’s EV market is hypercompetitive, and does not suffer legacy auto type incumbents. It’s why US automakers will likely leave China.
At least we have BYD and Tesla, just gotta scale up faster. Global light vehicle TAM is 90M units/year. 20% of all vehicles sold globally last year were BEVs or PHEVs, onward and upward.
Sadly (for myself) the only compact-ish plug-in hybrid that exists in my part of the world (Australia) is the Cupra Leon. Neat car, we're genuinely considering it, but it's $80,000AUD, vs. the $50,000AUD that a top-end hybrid Corolla would cost. And they're still much more expensive than my partners VW Polo... worth it for us, as we have a one car shared between the two of us, but I wish there were more compact-ish hybrids available.
Honestly same goes for EVs, though the BYD stuff is starting to fill that niche quite nicely. And compact + decent range is sort of at odds with itself.
This is badly misinformed. They make the market. When you buy a car, do you have it custom made, or do you select one that actually exists?
That's exactly what happened with SUVs. SUVs didn't happen because people were begging car companies to make them something big, dangerous, and wasteful. They happened because car companies in the US found a legal loophole where they could cut costs by skirting safety and emissions regulations, while simultaneously marking up the product as a premium one. Then they ran ads to tell people SUVs were super safe [for the passengers]. So when people started buying SUVs en masse, that wasn't organic demand, it was the result of a successful national misinformation campaign (because modern SUVs and other "light trucks" are so large you're more likely to just drive over your own child without seeing them than even get in a crash).
I am thinking about getting a third car for the farm if I could get an inexpensive low range EV. If I am only driving to work with it or to go shopping or see a sports game at my Uni I can just it when I get home. If I need to go see a game in a distant city, well, I’ll take one of the gas cars so my son will take the EV and not the Buick to work one morning.
Or maybe the rest of the world has way less population per area and therefore more gas stations, therefore filling up was less of a problem compared to the US...
