Legacy automakers did not confess that the switch to electric vehicles had been challenging, but Rivian Automotive Inc. did. Last week, RIVN increased its output forecast for 2023 and reported second-quarter earnings that above forecasts.
What will be the future of Legacy Automakers? (Source: The Geek Club)
Legacy Automakers Experiencing Difficulties Because of EVs’
Ford Motor F revealed on Thursday that the all-electric Ford Explorer will be unveiled in the summer of 2024 rather than the first anticipated early 2024. General Motors GM also disclosed on Thursday that problems with Ultium batteries continue to obstruct the manufacturing of its electric vehicles. Tesla Inc. The leader in the electric vehicle industry, TSLA, revealed today that it has once more slashed pricing in China, making it even more difficult for rivals to catch up.
The EV that will make its market debut in Europe next summer will be constructed on a base provided by Volkswagen AG VWAGY within Germany. Ford has previously disclosed that its EV division will lose $4.5 billion this year, which is $1.5 billion more than originally anticipated. Additionally, Ford CFO John Lawler did not give a specific date for the 2 million EVs per year production goal that was previously set for 2026.
According to Reuters, GM CFO Paul Jacobson said during an investor conference that production problems with the automaker’s new Ultium battery packs, which it is co-producing with LG Energy Solution Ltd., had slowed down the company’s EV output. GM shares plunged over 6% on Thursday to their lowest point in more than two months as a result of the alarming battery news. Only 50,000 EVs were produced by GM between January and June, and the bulk of those used an older battery pack. Last year, GM already fell short of its output goals. The Cadillac Lyriq’s production will be largely affected by the most recent battery problem.
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Electronic Vehicles Vs. Legacy Automakers
Tesla struck once more by reigniting the price war, just as concerns over prices began to ease. Tesla reportedly reduced the cost of the Long Range and Performance variants of the Model Y by roughly $1,900, according to a post on its Weibo account. Price competition seems to be a recurring theme in the Chinese EV world. Following the report, Tesla shares fell 1.7% in early US trade, while BYD Company Limited BYDDY, its biggest rival in China and the nation’s top-selling and legacy automaker, saw a stock decline of up to 8.7% in Hong Kong. Also declining were Xpeng Inc. and Li Auto Inc.
With exports from its China facility down 31% to the lowest level this year, Tesla’s July report revealed a slowdown in orders due to a lack of new models to draw customers. Tesla made the announcement that the updated Model 3 sedan would be produced at the factory, but it made no further details available. BYD, Li Auto, and Nio Inc. are concurrently NIO.
On the front of shipments, new records were set in July. Several companies, including Tesla and BYD, agreed early last month to ensure fair competition and refrain from abnormal pricing in the nation. However, the agreement was quickly revoked due to antitrust issues.
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