Report #125: 📊 US passes 1M EVs — 🔋 2023 Battery Prices — 💸 IRA guidance

Hey, Jaan here.

I’ve got lots to tell you about our EV industry. As usual.

But first, let’s talk about what’s up within our own little Universe here:

🌲 We planted a lot of trees!
For our Black Friday → Giving Tuesday discounts, we planted 733 real trees through Ecologi! 🥳 Here’s the impact we made together:

See our digital forest page on Ecology here, and you can dig deeper into each project by clicking on those little planted trees there.

Special thanks go out to David S, Dennis, Wojciech, Patrick, Ari, Trimmer Family, Desmid C, and to our ~100 EV Universe Pro members for helping us plant here.

I could not be happier about how this turned out. Can you imagine how cool it is that we made an actual impact on the planet here? The trees in these projects will grow and provide the world with so much, for decades to go.

Will we stop here? Frunk no. I will continue planting 2-5 trees on every new Pro member (join here), and as you know I’ve got plans to get my own plot of land to start growing a forest (likely to reforest) that’ll last for a hundred+ years.

Now, on to other stuff:

🔎 Our Cybertruck deep dive went wide. (link) I’ll update it with everything I’ve learned since, and will report back in our Teslaverse newsletter this week. Including what I learned from the Sandy Munro → Elon Musk interview.

🏷️ Discount on ads for next year. We’re booked for ads until mid-January, but if you’ve got that piece of marketing spend still hanging from this year, use it now to get your message in front of our 5,300 EV geeks next year. For more info, send me a reply here or at [email protected].

Jumping back to today’s newsletter, I’ve got 2,548 words that’ll help you start the week out fully electric and make you the smartest EV person by the watercooler (or… whatever the equivalent of a watercooler chat is these days).

Quite a few of you told me you loved the EV lab tour from Keysight last time (and I did too). Let me know what you think of the pod from our sponsor below!

Have you heard enough about where battery technology is heading, yet?

Keysight’s Auto Tech Talks podcast has one more perspective on this critical topic for the future of EV batteries. Prajyot Sathe from Frost and Sullivan shares the latest on battery technology and the market outlook for vehicle electrification.

From charging faster to sending power to the grid, the next generation of EV batteries will push the boundaries of power and performance. While Li-ion cells continue to be the most commercially viable cell chemistry platform for powering EVs, developers continue to explore alternatives.

Listen in on this timely podcast for anyone interested in the future of EV batteries and the impact they will have on the future of vehicle electrification. It provides pertinent insights into where EV battery technology is heading and the advancements necessary to facilitate transportation’s shift to electrification.

BloombergNEF has published its annual Zero-Emission Vehicle Factbook, a special report for COP28 (71-page pdf).

Although it includes the PHEVs too much for my taste, I get why it’s there, and I’ll highlight some of the learnings here anyway. Note — I’m a big fan of BNEF’s work and aspire to reach their level of analysis and reporting one day.

There’s so much to unpack in the report, that I will create a separate deep dive for it in our next week’s newsletter. Here’s a few quick takes as teasers:

Graph 1: the EV industry was supposed to be slowing down?!
Passenger EVs (BEVs + PHEVs here) are on pace to hit 14 million units sold this year. Up 36% from 2022. And sales are set to be up ~50% in the US.

I agree oh-so-completely with Colin here:

Countries with phase-out targets (aka ICE bans) in place now represent 19% of new passenger-vehicle sales. The number of companies formally committing to ending sales of new combustion vehicles covers 32% of global sales.

There are now an estimated 29 million zero-emission vehicles on the roads — 16.3M in China, 6.6M in Europe, and 3.8M in the US. There’s 41M on the roads if including PHEVs. Which makes up ~3% of the global car fleet.

🥳 The US has reached a million BEVs sold this year for the first time in a single year. (link)

For a quick context, China saw 552,000 BEVs sold in November alone, a record for the year and reaching 26.54% market share. (link)

Although it feels like what we’re talking about in our newsletters is entirely 'normal’, we’re clearly still in the early days. And that’s wonderful.

Ok, if I get carried away here, the rest of the email won’t fit in your inbox. So do read the 71-page ZEV Factbook here or wait for a summary from me next week!

South Africa expects the first locally built EV to roll off the assembly line by 2026 (link), using some of the $8.8B of climate funding from other nations (link).

The South African government’s 68-page EV plan for Just Energy Transition — which all news outlets refer to, yet none link to (most of them probably haven’t even seen it) — took some finding, but here it is. It’s called the “EV White Paper 2023”. Includes some valid research about EV efforts across the world too.

Axios created this interactive chart to visualize electric vehicle miles driven per 1,000 residents in the US, based on this data from Replica. Results visualize something we kind of knew already: the rEVolution is happening, it’s just unevenly distributed:

The UK ←→ European Union EV tariffs are to be postponed by three years to 2027, per European Commission proposal. (link) However, the proposal includes a clause that makes it legally impossible to extend it further.

Along with the UK→EU EV tariff postponing deal we talked about above, the European Commission also wrote in a proposal of €3B ($3.23B) in funding for the battery industry in Europe, distributed through EU’s Innovation Fund. Next up: a qualified majority of the 27 member states must now agree to the proposal, although most already are in favor. (link)

Norway: from 2030, all new trucks will either have to be emission-free or run on biogas. (link)

Volta Trucks’ business and assets have been acquired by a hedge fund Luxor Capital, for an undisclosed sum. (link)

Nearly 4,000 car dealerships in the US joined to send a letter to President Biden to pull back on the Electric Vehicle Mandate. They claim “the majority of customers are simply not ready to make the change.” (see the letter here) A pushback that was surely expected. There’s a list of participating dealerships… you know… if you want to send them a letter or something.

Watch tip: Ken Block’s Electrikhana TWO: One More Playground; Mexico City in the Audi S1 Hoonitron. The project was filmed in November 2022, a month before Block’s passing.

Guess what? Quite a lot of EVs from China keep getting 5 stars in the EuroNCAP safety tests. I wonder what’s that about? (link).

Fiat 500e will be released in US in spring 2024 (link), the special “RED” model starting at $34,095.

👋 Honda stops selling the Honda e in Europe. (link in 🇩🇪)

Tesla has started pushing inventory in the US instead of getting people to make custom orders, by showing inventory options on the front page and moving custom orders to Menu → Vehicles → Order. (link)

Looks like BloombergNEF is one of our core sources today. For a good reason. They launched results of the 2023 Lithium-Ion Battery Price Survey, collecting more than 300 data points from buyers and sellers of batteries from various sectors. (link) It’s one of the best real views into what the battery costs are across the industry.

This year: the average price was $139/kWh (down 14% from last year), with China at $126/kWh and US 11% higher, Europe 20% higher.

For battery-electric vehicle (BEV) applications, the average came in at $128/kWh for battery pack and $89/kWh at the cell level.

As usual, China's e-bus and commercial EV sector had the lowest prices at $100/kWh.

One of the interesting takeaways is the convergence of battery prices across the different sectors:

On average, LFP cells were 32% cheaper than NMC cells in 2023. Here’s how the battery prices have changed historically (dark blue cell level, light blue adding pack):

Add in subsidies like the IRA + further advancements in battery tech + more raw material supply coming online (slowly from both mining and recycling), and… we've got ourselves a very attractive situation for EV adoption?

For more context — we’re ranking the top 5 battery makers in the world by the capacity deployed January-October 2023, in today’s Pro Report (link).

The US Department of Energy has proposed guidance for what constitutes a “Foreign Entity of Concern (FEOC)” under the IRA’s electric vehicle tax credits.

In a nutshell — determining which automakers and models will be eligible for the $7,500 or $3,250 EV incentive, and which will be left out.

Automakers won’t be able to receive the credits if any company in their battery supply chain has 25% or more of its equity, voting rights or board seats owned by a Chinese (or Russia, Iran, or North Korean) government-linked company.

The FEOC rules come into effect in 2024 for completed batteries and in 2025 for critical minerals used to produce them.

There is some room (or rather… unknowns) left in the government's interpretation, so we’ll be playing a little wait-and-see game on this.

However, some automakers have already stated:

Our Next Energy’s (ONE) dual-chemistry battery Gemini demonstrated a 608.1-mile (978 km) WLTP range, in a BMW iX.

The Gemini battery offers 450 Wh/L of energy density and a capacity of over 185 kWh in a space typically allocated for passenger EV battery packs. (specs here)

The dual-chemistry pack (LFP cells for daily + “anode-free high energy density cells” for longer trips, coupled by the DC-to-DC converter) reduces the use of lithium by 20%, graphite by 60%, and minimizes nickel and cobalt dependency.

The BMW iX was used for tests because BMW i Ventures is an investor in ONE.

Interestingly, ONE also announced last week it will lay off 128 employees “in response to market conditions and to focus on core priorities.” (link)

And just this Sunday, ONE replaced the CEO, switching the founder/CEO Mjaab Ijaz out for Paul Humphries, with Ijaz moving to CTO role. (link)

Tesla adds Supercharger Congestion Fee — will charge US drivers $1 for every minute they charge their car above 90% at certain Supercharging locations. (link) Only applies when the Supercharger is busy; your vehicle’s battery is already at or above the congestion fee level; and has a 5-minute grace period after alerting you of the fee incoming via the app.

UK announces a new £70M pilot scheme as a part of the Rapid Charging Fund (RCF) to upgrade the electric grid capacity in 10 trial motorway sites in England — to support deploying the fast rapid charging hubs. (link)

GM and EVgo have opened the first 17 DC charging locations in 13 US states, located in the Pilot Flying J travel centers. By the end of the year, they should have 100 chargers up in 25 locations, each offering 350kW. A total of 2k stations in 500 locations is the goal in 2025. (link)

Mercedes-Benz 🤝 BMW to build a 50:50 joint fast charging network in China, with “at least 1,000 high-power charging stations with ~7,000 chargers by 2026.” (link)

Stellantis will partner with CPOs to install 1600 chargers in 400 of its dealerships throughout Europe, will be co-branded with Free2move Charge. (link)

Today I’ll give you thoughts from Michael Liebreich, founder & contributor of BloombergNEF and host of Cleaning Up. He goes a bit further in the next tweets but the idea I resonated with is shown here:

I personally feel we are finally in a timeline where we can start approaching actual circularity with these resources. And how wonderful will that be?

Can’t wait to see what the ‘chain will look like in 2040 or so.

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See you soon,

— Jaan ✌