Have you noticed the widening gap between reality, the truth, and what the government, the industry press and the manufacturers are telling us?
I’ve always prided myself on being one of the most accurate future forecasters in the industry. My track record stands documented through the content I’ve generated over the last 30 years as a magazine columnist and journalist.
Just now the other side of this debate just spewed coffee out of their nose when they read my previous sentence. Well, get a paper towel and some Windex and clean up the table.
Yes, I just said that I consider myself to be a columnist and, even more importantly, I view myself as a journalist. Yup, the wise-cracking, flamboyant Jim Ziegler is by true definition a journalist. A ‘journalist’ writes and reports by a strict set of rules and guidelines, but central to the concept of journalism is the pursuit of reporting the truth. Many times, the ‘truth’ is only proven by the outcome of the content by history. Often times ‘Truth’ is not evident through the noise of conflicting reports.
The EV Crash Is Here
I predicted (accurately) that EVs, electric vehicle sales, were going to crash hard. I said it definitively and I said it first before anyone in the alleged industry press or ‘Facebook Prognosticators.’ I was saying it in no uncertain terms that EV sales might level out at 10 percent, no more. That it would be just another type of transportation in the mix for consumers to choose from.
There was a chorus of social media gurus, vendors, and manufacturer executives that actually wrote articles disputing me and what I’d said. I lost some friends over my predictions. Most of the time my predictions go against the flow of popular opinions. I am underestimated and disparaged, not taken seriously until history proves that I was right all along.
Then a phenomenon occurs where all of the other alleged futurists claim they were saying that all along. They take the bows and credits; they even receive awards. I have been the opening keynote speaker for 98 state dealer associations and numerous other events and 20 groups with my signature speech titled ‘The Shape of Things to Come’ after a novel by H.G. Wells or, as I first became aware of the title, a song in the 60s from The Yardbirds—I was a disc jockey at several of the biggest radio stations in the country before I got into the car business.
Seeing into the Future
Anyway, my speech consists of my predictions of the future in the auto industry. Every time I’ve presented that speech, it updates to what’s happening now and what I see in the short range and longer view of what’s going to happen. I am extremely accurate, not because I am so brilliant, but because some other people are least uninformed.
I have often said, “They called me ‘The Voice Crying out in the Wilderness’ and now I am a ‘Senior Statesman.’ It depends on who you’re talking to.” Another voice in the wilderness is my friend and brilliant prognosticator, Geoffrey Pohanka, Immediate Past Chairman of the NADA and Chairman of the Pohanka Auto Group. He has been a relentless critic of EVs and is an encyclopedia of knowledge of all of the reasons EVs are failing and will fail.
Pohanka has posted literally hundreds of posts on social media about why EVs will never be more than a small portion of the market. Every one of his posts on LinkedIn gets dozens of comments with pro and con debates. Not surprisingly most of the comments defending EVs, upon further scrutiny, come from vendors or suppliers that have a financial interest in the EV industry that has sprung up.
EV Inventory Continue to Grow in U.S. Lots
Let me take a moment to slap you across the face with a stinging dose of reality—EVs are stacking up on every dealers’ lots.
Ford Motor Company stepped out in front of the rest and pushed all of the chips to the center of the table, ‘All In’ on EVs. They committed billions to battery and manufacturing plants. They launched new EV models like the F150 EV Lightning, and the abominable Mach-E Mustang. As Ford Motor Company lost billions on EVs that didn’t deter them. The only increase was Farley’s paycheck.
To say those didn’t sell would be a kind understatement. Dealers nationwide have all the Lightnings and Mach-Es the factory can force down their throats and they are sitting on the lots with weeds growing under the tires. Any dealer would gladly lose thousands just to get them off of the lots in spite of huge discounts and government subsidies. EV sales are in the toilet fighting the swirl.
Several manufacturers have totally cancelled EV production until sales catches up with inventory. (Do you think realistically that is going to happen?) VW even laid people off and closed down facilities.
An Industry Problem
Every manufacturer, domestic or foreign is having a similar situation. Even Tesla is losing money for the first time. Tesla has dramatically cut prices which caused a chain reaction where all the other manufacturers have had to cut prices and offer huge incentives to compete.
Every dealer, except maybe those in California or New York, will tell you that they’re getting calls from the factory reps every day urging them to please take more EVs. If they say “No, please don’t send us any more EVs, please don’t,” some manufacturers have even turned to nasty pressure tactics to make dealers take more EVs.
EVs been such a failure that the government has even ratcheted up the pressure with new executive orders and deadlines as well as increasing the Federal Incentives. Still, the public has spoken, ‘They Don’t Want EVs.’
History Repeating Itself
Then there’s the other problem—the Chinese are coming with dozens of top-quality, good looking, cheap EVs.
Twenty years ago, I was the Keynote Speaker for the New Jersey State Dealer’s Annual Meeting with NJ Car. Jim Appleton had hired me to present my Shape of Things to Come Speech. There was another speaker on the platform after me, Malcolm Bricklin. Bricklin was about to bring Chery Chinese Automobiles to the U.S. Market as he had done with Subaru of America. He also had several failed projects like the Yugo cars.
At the time I said as part of my speech, “Chinese cars will never come ashore, they may but existing franchises, but a Chinese nameplate will not happen. China has a two million man standing army and building a war machine with no enemies. It appears to me they’re going to start something with somebody, and all bets will be off.”
I was heavily criticized for that speech. But, the deal with Chery fell through and Chinese Cars to this date have never come ashore as I predicted in 2005.
An Affordable EV?
Still, Pohanka has stated the current crop of stylish Chinese EVs cars and trucks have superior technology, inexpensive, and affordable that feature superior range and fast charging.
Manufacturers in the U.S., Japan and Europe are very afraid of this because they believe they’re coming ashore for the first time. The biggest threat being that they are affordable.
Okay Ziegler, you made your point. We heard you the public won’t buy EVs. BUT you know what Jim? We’ve all been told and we’re reading that the main stumbling block is they aren’t ‘affordable.’
Okay, there’s that word again, Affordable. Are affordable EVs the magic solution? All of the manufacturers are in a race to produce the ‘Under $25,000 EV.’ The industry media says that’s the answer. Wait until the buyers find out how much it costs to insure those puppies as well as retrofitting your house so you charge the battery.
Advice to Dealers
Well, I’ll say this to dealers everywhere …
“We’ve all caught on that used EVs aren’t worth but a small fraction of what they sold for new. Most of them lose more than 30% in the first year. A five-year-old EV loses so much value its almost disposable like a five-year-old laptop or cell phone.
But dealers, listen to this: I suggest you buy all of the used Teslas that you can buy at bargain prices. Hertz recently sold every Tesla they had at a hefty loss because of the problems they had. Buy all of them you can or could have. Used EVs are great ‘Special Finance’ cars’. In case you haven’t noticed people’s credit is crashing too with record delinquencies and repossessions. Banks are withdrawing from the market. Cheap Used EVs are great for that market.”
I predict that cheap EVs under $25,000 or not, whether the Chinese bring them ashore, or not, will still be ignored by the public. They might be great for special finance clientele but not mainstream buyers. Leasing won’t work either because the lessees have already adjusted residuals to the bottom. They know they’re not going to be worth much as a used car.
But Mr. Ziegler, what do you suggest? The manufacturers’ are charging headlong and producing new models. We’ve all read your articles and social media posts, and Geoff Pohanka’s, Max Zanan’s, and Mark Juron’s, but we still have to sell them? Why are they so convinced it’s the way to go in spite of all of the evidence that says otherwise?
Back Where We Started
That brings this article back, full circle, to a discussion about ‘journalism’ in the auto industry.
Everyone is aware, or at least you should be, that the American public has increasingly distrusts the media, as it has been replaced by political factions. Tune in on any cable news channel, they’ve totally sold out.
The auto industry’s journalism sources may have been corrupted as well when it comes to the issues of EVs. There are three, perhaps four, sources that we rely on for guidance, news, and current events in the car business to tell us what’s happening.
I just flipped through a current issue of one of the aforementioned sources. If you read this publication, you’d believe EVs were flying off of dealers’ lots. The entire issue is about all of the wonderful things about EVs. Of course, there was a smaller article about Tesla losing money and cutting prices dramatically.
Pivot from EVs to Hybrids
Let’s face it, there’s many vendors and suppliers—and even manufacturers—that want a positive spin on EVs. None of those industry information sources are dealer advocates. Every one of them leans toward the manufacturers.
The only manufacturer to lay back and not get caught up in the EV frenzy was Toyota. They’ve always been conservative, and it always seems to work for them. They’re experimenting with hydrogen and beefing up their already successful hybrid technology.
Of course, that’s something else I said in the beginning of the EV fervor that everyone is hopping aboard: Hybrids make sense. Farley at Ford must have been reading my stuff because they’re shutting down some EV production and drifting toward hybrids. So are almost all of the others.
Whether the Chinese come ashore with cheap EVs or the domestics and imports produce an under-$25,000 EV with 10-minute charging stations every six blocks coast to coast, if they think EVs are going to catch on with the public, I remain steadfast in a single one-liner:
“That Ain’t Gonna Happen.”
