nick.carey@thomsonreuters.com

Ford’s EVs losing big, Evergrande’s EVs on cliff edge
Fun fact: There were (about) 1.4 billion vehicles on the planet
in 2022, according to various estimates.
As you might expect, the U.S. has one of the highest
concentrations at around 82 to every 100 people. But there are
other car-loving countries, like Finland, which according to the
World Economic Forum at one point had 1.07 cars per person.
Not so Singapore. The city-state, which you can drive across in
under an hour and has a wide-ranging public transport system,
has just 12 cars per 100 people, data gathered by Reuters
shows.
A model country for decarbonising transport, you might say – but
there’s one problem. According to the Singaporeans, if you’re
going to have a car, it better be a supercar – and those usually
aren’t electric, at least for now.
More on this in today’s AutoFile – the last from Victoria
Waldersee and Nick Carey before Joe White returns next week with
fresh quips about baseball and the hapless Detroit Tigers –
alongside Ford’s loss-ridden road to EV profitability and the
possible end of days for Evergrande’s electric ambitions:

* Singapore’s EV push battles combustion engine
love

* Ford sees $3 bln loss in electric vehicle
business

* Evergrande’s EV unit under threat

If you’ve got it, flaunt it
Singapore is the most expensive place on the planet to buy a
car. That’s because the 5.6-million person city-state has a
unique system to limit cars on the road: to drive your vehicle,
you need to obtain one of a limited number of 10-year
certificates bought through a bidding process which can cost
tens of thousands of dollars.
The system, though effective at keeping the number of cars on
the road low, prices lower-income people out of car ownership
and means that Singapore now has more Porsches on the road than
Teslas. Over the past decade, the number of Ferraris in
Singapore has grown by 67% and Lamborghinis by 38%, the data
shows.
Alongside a few other ambitious countries like Iceland,
Netherlands and Sweden, Singapore wants to phase out combustion
engine cars altogether by 2030 – but sports cars aren’t so easy
to electrify, and although EV sales constituted 12% of total
sales last year, a Reuters analysis showed EVs represent just 1%
of cars on the road, with ultra-wealthy car-tech enthusiasts
buying their Tesla but ultimately keeping it in the garage and
taking the Ferrari out instead.

Essential Reading

* South Korea’s LG in talks to supply Toyota

* CATL to mass-produce cheaper batteries

* German needs 14,000km in new power networks to
prepare
for renewables

Ford’s model-e: losing on the way to winning
Ford expects its electric vehicle business to lose $3 billion
this year, with cumulative losses in 2021-2023 of up to $6
billion by the end of the year – but all is on track for a
pre-tax margin of 8% by late 2026, the company said.
Investors seem to believe them, with shares up 1.9% on Thursday
despite the big red numbers. The company said last March it
would run its EV unit separately from its legacy combustion
engine business, allowing investors to separately value the two
businesses
It’s well-known that building up an EV business is, Reuters
Breakingviews columnist Jonathan Guilford notes, a “big cash
incinerator”. While some say EV-only makers have an edge by
focusing exclusively on new technologies, legacy automakers can
use the profits from their combustion engine business to
subsidize the build-up of EVs – unlike start-ups which rely on
external funding.
Still, it’s a steep hill to climb, Guilford writes, with rising
costs and pressure from competitors making breaking into the new
market all the more challenging. But scale helps.
A Ford announcement at the end of the week further emphasizes
the expense involved in going electric. The carmaker said it
plans to build up to 500,000 electric trucks a year at its
BlueOval City complex under construction in western
Tennessee.
The complex is being jointly developed with Korean partner SK On
at a cost of $5.6 billion.

Evergrande EV ambitions on cliff edge
China’s embattled Evergrande’s New Energy Vehicle Group may have
to halt production of EVs if it cannot obtain more funding.
If, at some point in the future, it receives over 29 billion
yuan – about $4.2 billion – it could launch a number of new
models and hit mass production, the company said.
But for now, its struggling under the weight of its parent
company, the most indebted property developer in the world,
which is in the middle of restructuring $22.7 billion in
offshore debt.
The hope is for that process to facilitate an orderly resumption
of business operations – but the EV business may need to be shut
down in the meantime.
This continues the woes Evergrande’s EV unit, which had
previously planned mass production of its second EV model in the
first half of 2023 and said it aimed to make 1 million vehicles
a year by 2025. The Chinese group was forced to sell off some
parts of its EV business in 2021 to cut its debt.

Fast Laps

New car buyers are paying painfully high interest rates in
the U.S., forcing some to swap their purchases out for a more
humble ride or cough up record amounts upfront to avoid high
payments.

Europe’s politicians are optimistic they’ll find a solution
to the e-fuels debate

, which though not on the agenda for an ongoing summit is
dominating discussion, sources say. Officials suggest a deal
could be struck in a number of days.

Renault and Nissan may pair up on an vehicle charging
network in 11 European countries, Renault told Reuters. “It is
up to Nissan to decide,” their charging unit CEO said.

(Editing by Alexander Smith)