The Impending EV Fiasco? - Automobility
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The Impending EV Fiasco?

Seven years and seven months ago , Bill Russo was invited to a panel discussion hosted by the legendary John McElroy for his Autoline This Week program, which was recorded on the floor of the Beijing Auto Show.  John has covered the auto scene in the USA for generations and his program is a must watch for everyone in the American automotive community.

This was prior to starting Automobility in 2017, when Bill was the Managing Director of Gao Feng Advisory Company.  The panel also included Michael Dunne of Dunne Automotive (currently ZoZo G0) and James Chao of IHS Automotive Asia-Pacific (currently S&P Global Mobility).

The discussion was focused on the outlook for the Chinese auto market which was still on a growth trajectory in 2016 with several potential discontinuities on the horizon, including Electrification and Intelligent Connectivity.

We repost here the recording of this program from April 2016, as it gives some indication of how accurate his predictions from that time were given the fullness of history.

China’s EV Feast is the Rest of the World’s Fiasco

Recently, John McElroy posted his own reflection on LinkedIn under the title “The Impending EV Fiasco, Five Years Later”, where John accurately predicted years ago how the electrification plans of the global automakers would lead to disaster.

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We fundamentally agree that the EV strategies of global automakers are fundamentally and fatally flawed.  We also believe that there is too much celebration among the naysayers that are challenging the very idea of an electric future, including Akio Toyoda:

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Of course, there will be losers – especially those who are trying to pigeonhole EVs into a premium lane alongside more affordable and highly scaled ICE/Conventional Hybrids.

The path to scale, as Ford Motor Company taught us over a century ago, requires “democratized” pricing, efficient supply chains, and trade-offs on cost vs. performance that today’s automakers are unwilling to make as this would cannibalize volumes and profits from their ICE cash cows.

What is happening in China is that leading EV makers, especially BYD, have taken a different path and are well on their way to demonstrating that there is a path to scale: and to paraphrase a great tag line – “Its the affordability, stupid!” You get there with vertically integrated (i.e. battery) supply chains and intelligent trade-offs on cost vs. performance for the target use case for the EV (LFP vs. NMC).

More on this in Bill Russo’s chapter of Selling to China titled “China’s Auto Industry: The Race to a Sustainable Future”, which can be ordered by scanning the QR code:

Please contact us at [email protected] if you would like to order a copy of the book in China.

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