AD #3524 – Price War Spreading Fast In China; GM All In With ChatGPT; Ferrari Purosangue Opens Up

This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.

PRICE WAR SPREADING FAST IN CHINA
In January Tesla kicked off a price war in China that is spreading far faster and more widespread than anyone anticipated. CarNewsChina reports that 30 brands have cut prices outright, have offered discounts, insurance subsidies or even gift packages to try and get more shoppers back into showrooms. And it’s not just with electric cars. Inventory of ICE cars piled up last year as consumers relied on government subsidies to buy electrics, so prices of ICE cars are falling too. The price cuts range anywhere from $1,000 to $15,000, and this is the last thing the Chinese auto industry wanted to see. Last year was a tough year for the industry as strict Covid controls hurt sales. And so far this year the market is not recovering as quickly as hoped, and that’s why the price war keeps on spreading.

CHINA’S XI JIN PING WARNS CATL
Speaking of China, President Xi Jin Ping, sent a clear warning to CATL, that the battery company may be growing too quickly and gaining too much power. Xi hinted that new regulation was needed to ensure the battery market developed in a “steady and prudent manner” instead of the boom-town mentality that persists right now. The Chinese leader has also cracked down on tech giants in the past when he thought they were accumulating too much wealth and power. CATL controls 37% of the global EV battery market and is working with Ford to build a battery plant in the U.S. It also has supply contracts with Mercedes, BMW and Hyundai. But when the President of China tells you you’re growing too fast, we’re pretty sure that CATL will step on the brakes.

BRITAIN RISKS LOSING OUT WITH EVs
Meanwhile, on the other side of the planet, the situation is looking grim for the British auto industry. The SMMT, the Society of Motor Manufacturers and Traders, says Britain may not be able to compete in making EVs unless the government comes up with subsidies like the U.S. and the EU are offering. Several automakers including Tesla and BYD decided to not build plants in the UK because of Brexit. When the UK was part of the EU, it could export vehicles and parts to the rest of Europe without any tariffs. Now that Brexit took the UK out of the EU, exporting cars from Britain to the continent makes them uncompetitive on price. One of the SMMTs suggestions is for Britain to negotiate more free-trade agreements.

 

GM ALL IN WITH CHATGPT
GM’s VP says that “ChatGPT is going to be in everything.” Most automakers will use the technology to create a sort of AI in-car personal assistant that’s interactive and will make communicating with the vehicle much more natural. We’ve reported how several Chinese automakers are using a similar system, developed by Baidu and Geely, but GM is going more direct to the source. It’s working with Microsoft, who invested billions in ChatGPT founder OpenAI, to come up with possible uses for the technology. Specifically, GM says it could be used to explain how vehicle functions work that would normally require reading through the owner’s manual or making it easier to integrate functions like a garage door opener or work calendar. It seems like automakers could view this technology as a way to eventually make older cars appear more up to date even as they age.

RIVIAN WANTS DIFFERENT DEAL WITH AMAZON
Rivian is trying to rework its deal with Amazon, according to the Wall Street Journal. The EV startup got a huge boost in 2019 when Amazon agreed to buy 100,000 electric vans through 2030. The vans, which were customized for delivery by the two companies, are made at Rivian’s plant in Illinois. But to get the deal with Amazon, Rivian agreed to sell all of the vans it makes to Amazon until it fulfills the order. However, Amazon is only buying 10,000 vans this year, which is at the low end of previous forecasts. So Rivian wants to end that exclusivity deal, and sell vans to other customers. But how many more vans could it sell is the real question. Rivian says it’s aiming to sell 50,000 vehicles this year, which also includes the R1T and R1S.

FERRARI PUROSANGUE OPENS UP
Ferrari is getting ready to launch its first SUV, the Purosangue and Magna revealed it’s going to supply it with some pretty cool door technology. It features SmartAccess on the rear suicide doors, which is basically like smart power doors. In the Purosangue the amount of effort required to open or shut the doors will always be the same because the system can detect when the vehicle is on a hill and automatically adapt the required force. It also won’t allow the doors to be slammed and will catch them from flying open in the wind. Magna says several other Asian and North American automakers will launch with SmartAccess this year and that it also offers several other features, including gesture control, obstacle detection and keyless entry.

 

GMC HUMMER GETS BI-DIRECTIONAL CHARGING
Bi-directional charging is turning out to be a hot topic in the EV community and the Hummer EV is next on the list to offer it. Bi-directional charging allows owners to use their EV to run their home when the power goes out. It also allows them to charge up with cheap electricity when demand is low, and sell it back to utilities at a higher price when demand is high. Certain trims of the Hummer SUV and pickup version now come standard with a 19.2-kilowatt Level 2 AC onboard charger, enabling bi-directional charging. It’s able to provide up to 6-kW of power to other vehicles with an optional plug accessory. In addition to that, GMC is also now offering another accessory that will allow the Hummer to provide 3-kW of power for appliances.

SOLID STATE COULD CHANGE THE BATTERY MARKET
The market for solid state batteries in electric vehicles could grow fast. Solid state batteries are safer, charge faster, and are more energy dense than conventional lithium-ion batteries. A report from IDTechEx says the market for solid-state batteries could be worth $8 billion within a decade. The demand will be mostly driven by electric vehicles, but they’ll also be used for energy storage systems and consumer electronics. While today’s battery manufacturing is dominated by Asian companies, the U.S. and Europe are competing heavily in the development of solid state batteries, and could emerge as significant players if the technology truly catches on.

U.S. EVs AVERAGE NEARLY 300 MILES
Range anxiety is one issue that holds many people back from buying an EV. But automakers continue to add more and more range, especially in the U.S. Bloomberg reports that the average range of EVs in the U.S. is 291 miles, the highest in the world and a third higher than the global average. EV range in the U.S. has quadrupled since 2011, when the only mass market vehicle available was the Nissan Leaf, which had 73 miles of range. Today, the Lucid Air has the longest range at 516 miles. And five models, with an average range of 309 miles, accounted for 70% of EV sales in the U.S. last year, the Tesla Model Y, 3, & S, the Ford Mach-E and Chevy Bolt.

But that brings us to the end of today’s show. Thanks for tuning in.