Dealers cash in reselling the Model Y
The latest news from the world of EVs
Hello and welcome back to The Fast Charge, a British EV newsletter.
In today’s edition… new EV ‘scalpers’, the Model Y hits the leaderboard, and calls for VAT equality grows.
As ever if you have any questions or comments, please do drop me a line (email@example.com) or simply reply to this email.
In the last week…
MODEL Y: Only a few weeks after they arrived on British shores, Tesla’s Model Y has shot to no.4 on the Society of Motor Manufacturers and Traders (SMMT) list of best-selling cars in February. Closely behind it in no.5 is the Model 3. As noted in previous editions, the way car registrations for Tesla are reported tends to be staggered, meaning they can accumulate a large number of figures, but even so, this is impressive. I suspect soon we’ll all be seeing the Model Y on our streets. I saw my first Y in the ‘wild’ on Chiswick on Sunday.
Y RESELLING: One thing I was surprised to see over the weekend was that 13 Tesla Model Y’s - when I last looked on Saturday - were already for sale on Auto Trader. This is odd for two reasons, firstly Tesla doesn’t sell cars via traditional dealers and secondly these Model Y’s weren’t listed for ‘used’ car prices. Oh no, they are being sold in some cases with a £5,000+ mark-up - even though quite a few sellers don’t even have the vehicles yet. So why are they doing this? Well, it turns out that quite a few dealers have caught onto a new way to make some extra money from the new EV market using a strategy known on the internet as ‘scalping’. You may have heard this term before in the context of games console shortages and ticket reselling. Essentially, a ‘scalper’ is someone who buys or reserves a new product when it’s first released in the hope that, because the product is in such high demand, people will pay more to jump the queue. This seems to be what’s happened with the Model Y. Back in October when Tesla announced Model Y’s were coming to the UK, anyone could reserve one for a mere £100. Paying this advanced holding fee gave the ‘buyer’ a slot on the factory queue. I’m informed that, once they have this and a delivery date, all these ‘EV scalpers’ do is put a higher mark-up on the price and try to sell them before they have to pay the manufacturer (in this case Tesla) for the actual car. As per some of the descriptions, dealers are saying this way people can “beat the 18 months waiting list.”
Given the semiconductor shortage, it seems this approach certainly has customer interest. I’m told by one dealer source that they often have people trying to ‘jump’ the queue for new EVs. I’m not suggesting this is illegal but it will certainly be annoying if in future you can’t get hold of cars because automated ‘bots’ have snapped them all up. One way to avoid this might be by increasing the fee to reserve vehicles. However, some carmakers who are trying to prove demand for their models might want to keep the fees low.
MORE EVs: Elsewhere in SMMT’s latest car stats, they also revealed that pure electrics took a 17.7% market share in February. This is huge. When combined with other ‘EVs’, the number of registrations for cleaner vehicles was a third of the market. SMMT has used this news, which shows people are increasingly switching to EVs, to call for accelerated investment in infrastructure. They also for the second time in the last month have called for the VAT rate on public chargers (20%) to be brought in line with the rate for charging at home (5%). This is a call-to-action that is becoming increasingly popular and supported by a wide group of industry businesses, such as the RAC. The EV pressure group, FairCharge, which is led by auto journo Quentin Wilson, is petitioning the government for the change (and has 80,000 signatures). I doubt Rishi Sunak will bring about this change in the Spring Statement as the cost (aka money the Treasury will lose out on) will have to be found elsewhere – which at the moment would be quite tough. But never say never! To note, February is typically a low volume month for vehicle transactions. Read more.
ENERGY RELIANCE: As the war in Ukraine continues, it seems many policymakers in Europe and the US are now planning a ‘step-by-step’ move away from using Russian oil and gas. As Russia is a large energy exporter, this will only send current prices higher. Already today there are talks that energy bills are set to skyrocket and that petrol prices could hit nearly 160p. These increases – that have already started since November – are no doubt shifting more and more people to EV’s – shown in the huge market shares SMMT has highlighted. This is great news in some ways but not in others. Given the already fast pace of change, the government will need to ensure there is the right EV infrastructure in place with the right rules – but its strategy is still yet to be published. Likewise, we should not ignore those who do not have the luxury to switch to EVs as they must make difficult cost decisions instead. Read more.
NO CHEAP EV: Linked to this, though there has been talk of EVs getting cheaper as material prices fall, Benchmark Mineral Intelligence – a hugely respectable and influential voice – has warned that rising prices of lithium, cobalt and nickel could threaten this. According to an analyst there, prices are currently increasing rapidly as the Ukraine crisis and sanctions on Russia could cut off a key nickel supply – Nornickel, a Russian mining firm, produces 20% of the world’s nickel. Like our energy bills, I’m sure it’s worth having these short-term price rises for the (hopefully) prospect of Russia failing. Read more.
NO PULSE: Going back to infrastructure, I noted this tweet about BP Pulse last week. It seems they are still keeping up their reputation as Britain’s worst provider of quality service. The tweet highlights how BP Pulse, like many networks, take a holding fee for using a charger despite them not working properly. In this case, a holding fee was not refunded to the customer until they had to ultimately contact their bank. These things are the sort of annoyances that need to be ironed out with national rules. If you’re not familiar with the ‘holding fees’ at EV chargers, I’ve written about them previously here.
NOT RELIABLE? The consumer group Which? caused controversy last week as they published the results of a reliability survey that suggested battery electrics had more faults than ICE vehicles. The survey was based on nearly 48,000 people of which 2,184 had an EV. The reason the number of faults was so high is that software issues, problems with the car’s smaller 12v battery, and brakes caused them to break. In a statement, Adrian Porter from Which?, added that: “Year on year, Tesla comes up as one the most fault prone, unreliable car manufacturers thanks to feedback from current owners.” As you can imagine, this report (that was picked up by Sky News and others) did not go down well in the EV community. Read more.
NEW PARTNERSHIP: British icon Aston Martin has signed a ‘memorandum of understanding’ to work with Britishvolt on the development of “high-performance battery cell technology” it was announced yesterday. It all comes as both firms are trying to gear up their operations. Aston Martin hasn’t had an easy time recently but is set to launch an EV in 2025. The agreement is similar to what Lotus has also signed with Britishvolt. Read more.
TARGET RAISED: One carmaker looking to make a splash with EVs is Stellantis – who own brands such as Peugeot, Citroen and Maserati. Last week their CEO, Carlos Tavares, announced a ‘Dare Forward 2030’ strategy that would help the business reach net zero by 2038 and offer 75 pure electric models globally by 2030. This is part of their plan to make all its European car sales electric by 2030 (and 50% in America). I read this first in the EV Universe.
CATCHING TESLA: In other manufacturer news…. I’ve seen a couple of stories in the last week about certain brands ‘going after Tesla’. In my view, this sort of language only enhances Tesla’s reputation more. Anyway… last Wednesday Ford Motors revealed it was boosting investment into EVs to $50 billion. That’s up from the previous $30 billion it had committed. Ford also said it would be splitting its business between those developing EVs (called Model e) and those working on legacy products (called Ford Blue). This is how the CEO, nice guy Jim Farley, wants to solidify electrification into the business – they are aiming to produce 50% EVs by 2030. Elsewhere, Honda and Sony have said they are exploring developing an EV together under a “New Company”. The ‘strategic alliance’ could lead to a car on the road from 2025. Read the press release. This news comes about a month after Sony first announced it was entering the EV market with a snazzy video of the ’O2’ concept.
NEW CONCEPT: Speaking of concept cars called ‘O2’, Polestar has announced their own. Last week they published a video and details about developing an electric roadster, building on the precept it revealed last year. From looking at the images, the car does look quite pretty. The wheels are a bit like you’d get on the Mini EV, but the shape is certainly attractive – albeit it has a whiff of Lotus Evora. I do like the way Polestar is developing these new sporty models. And I love the language they’ve used to describe the O2. “Rather than resort to outlandish wings or spoilers,” they wrote of the car’s aerodynamics, “the O2 features integrated aero ducts in the wheel arches and rear lights that double as air blades.” Perhaps most intriguing here is that the O2 also comes with a built in ‘cinematic drone’ that can record your ‘premium electric’ experience. I’m not sure how useful this feature will be in reality, but I’m sure the inner child in many of us will definitely want to hit a ‘DEPLOY DRONE’ button James Bond style. Read more on Polestar or Autocar. Video below.
NEW LOCATION: It’s been announced that in 2023 Fully Charged Live will be hosted at the Yorkshire Showground in Harrogate. Hopefully, this news will spur the local area to invest in more chargepoints.
WIRELESS NEWS: Interesting news from Gothenburg in Sweden. Volvo has launched a wireless charging trial for taxis using their XC40 EVs. The technology is being provided by Momentum Dynamics and the pilot will last three years across two locations. Read more.
GOOD COLUMN: Finally, if you fancy a lunchtime read, I found this column suggesting Tesla needs a ‘Tim Cook’ very interesting. It’s by Roberto Baldwin and was posted on Techcrunch. Baldwin doesn’t say Musk should quit or anything dramatic, but he does believe it’s time for him and Tesla to start nurturing a successor – should Elon shoot off somewhere else. My own view is Tesla shouldn’t do that. As anyone who has seen the TV show Succession, once you look like the crown is coming off, that’s when people make moves. In history, the former British Prime Minister David Cameron discovered this fate all too well when he once revealed he wouldn’t do a ‘third term’.
By Tom Riley