Hyundai PR tomfoolery, EV shares and the NAO

The latest news from the world of electric motoring.

Good morning and welcome back to The Fast Charge, the electric motoring newsletter. My name is Tom Riley.

I’m afraid I’ve not written a big read today but a fair amount of interesting news instead. From EV shares dropping everywhere, a chip shortage, some funky PR timings from Hyundai and the revelation that the UK government only funded 700 public chargers in the last decade.

If you do find The Fast Charge interesting, please do share it or invite your friends to sign-up. Likewise, do drop me an email at tomrileylondon@gmail.com if you have any questions or comments.

In the news…

GOING SOUTH: About a month ago, the Financial Times started an enormous spreadsheet highlighting EV related shares. They suggested it was a bubble likely to pop, as other than high government investment around the world and some strong sales, they couldn’t really work out why companies were doubling in value every time you hit refresh. However, over the course of this week many EV stocks have gone down - some by quite a large amount. The FT has taken great joy in their prediction being correct saying “it looks like FT Alphaville might have nailed it.” But have they? Stock prices go up and down, sometimes for no reason at all. You only have to look at the GameStop saga to realise how much of a poker game it can be. And as I’ve said before, major business people like Bezos and Musk are known to dislike it as a performance tool. Additionally, in the past week, there have been many a hiccup for the EV industry, not least a chip shortage which is affecting supply chains. 

WHEN THE CHIPS ARE DOWN: At the moment car manufacturers are being impacted by a limited supply of semiconductors. The ‘chips’ are used in everything from consoles to phones. Companies like Tesla, GM and Ford have been impacted by the shortage meaning in many areas production has stopped altogether. This has led to many shares in EV companies going down this week, leading to stories like the FT’s claiming a burst bubble. In response to the issue, President Biden has signed off a 100-day review of critical US supply chains. One of the problems that will likely be identified is an overreliance on using Asia as a source for chips. No doubt similar incidents could occur again. Europe (including the UK) is already trying to avoid such scenarios in the future by setting ambitions to have manufacturers of components closer to home by 2025, especially with battery production.

DREAMING BIG: It feels like each day now there is a new company (new and old) that is claiming to take the throne of electric cars. This week is the turn of Lucid Motors, the EV company founded by a former Tesla engineer, who is currently looking at floating on the stock market. They plan to launch a rival to the Model 3 in 2024 or 2025 with a range of 500 miles. The business filed for a $24bn listing this week. An eye-watering sum for a business without a competitive car in production yet. I suppose this is why people like the FT get convinced of a bubble. Lucid claim they are doing this to mimic Tesla and to raise money.

BURYING BAD BATTERIES: Another blow to the EV industry this week was Hyundai announcing it has to replace the batteries in nearly 82,000 of its electric vehicles worldwide because of a fire risk. This will no doubt worry many consumers and investors looking to get in on the EV game. The recall is expected to cost Hyundai about £640m ($900m) and is apparently the biggest one in history. The most affected cars are the Kona and Ioniq models sold between 2018 and 2020. HOWEVER. What I find most interesting about this recall is that it was announced by Hyundai literally less than 24 hours after they revealed their new Ioniq 5 EV model. Perhaps I’m being cynical but I do wonder if they tried to do a bit of PR tomfoolery - Hyundai giveth and Hyundai taketh. Maybe we need manufacturers to make more mistakes for them to counter with new models!

ALTHOUGH… it must be said that the new Ioniq 5 does look rather good. Perhaps a bit like something you’d see in Bladerunner or as the villain in the film Cars, but that’s a good thing in my book. The max range will be nearly 300 miles with the capacity for charging of 200kW - meaning a refill charge from 10-80% could take just 18 minutes. It’s bitey too, the dual-motor version - which a bit more spenny - holds 302 horses. And they could catch a fox going 0-62 mph in just 5.2 seconds. The only problem is the price which will be around the £45,000 mark. A final redeeming feature is the Ioniq will offer vehicle-to-grid charging, so perhaps it will pay for itself a little bit. 

SMALL EXCITEMENT: Everyone this week seems to be getting very excited about the Hong Guang Mini EV - the Chinese mini-electric which costs just over £3,200. I’ve seen articles everywhere including on the BBC. Readers of The Fast Charge will know we covered this game-changing little car nearly 2 months ago (as well as a look generally at China EV surge). Read here.

SOLAR FLARE: The National Audit Office in the UK has today published a report on ‘reducing carbon emissions from cars’. It’s a lengthy paper on how effective the government is being to meet its green targets. In essence, they’ve told the government to stop splashing cash frivolously and to work smarter at preparing for 2030. The key bits they’ve raised is:

• Since 2011, total carbon emissions from passenger cars have reduced by around 1%, which is less than the Department for Transport (DfT) expected

• Average emissions from new cars in Great Britain fell year on year between 2011 and 2016. However, emissions increased by 6% between 2016 and 2019 - due mainly to the popularity of SUVs

• By March 2020, government funding had contributed to 142,604 new charge-points, most of which are on private driveways, during the last decade.

• They’ve spent £97.2 million supporting the installation of more than 133,000 chargers for those with off-street parking.

• 8,000 were at-work charging points and only 690 were on-street charging points for people to use. This was bolstered by 19,000 privately funded public chargers. These figures are crazily low, though maybe because councils are doing it instead.

On the report, head of the NAO Gareth Davies said: “The number of ultra-low emission cars on UK roads has increased, but meeting the government’s ambitious targets to phase out new petrol and diesel cars in less than a decade still requires a major transition for consumers, carmakers and those responsible for charging infrastructure.”

In response, The Sun newspaper also wrote an editorial hitting out at the ‘dire shortage’ of public charging points and DfT for celebrating too soon. The Sun suggested: “unless by then someone makes a comfortable, spacious £20,000 electric SUV with a 400-mile range, we know what most drivers will do: Buy another fossil fuel car in 2029 and drive it for 20 years.” I had never thought about the ban this way before but, hopefully, the NAO report will wake up the PM and Chancellor ahead of the Budget.

I want to see VAT get reduced on public charging points. Equality for on-street parkers!

By Tom Riley