Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday.
The Chinese Are Ready For The Future
I start today with this clip from “The West Wing” to make two points: We have fairly free trade, though it’s unequal (thus the rush to build EV battery plants in America). Do your prices for everything feel cheaper? Well, no, of course not, but is that trade’s fault? We built a highly interconnected system of global suppliers and just-in-time production built on the back of containerized shipping and labor wherever it was efficient (cheap, union-free, maybe child labor). This would lower prices and stop wars! Not quite. We built a flat world instead of a tall one only to discover that the costs of putting our supplies so far away is that if anything went wrong we wouldn’t be able to get them here. The pandemic didn’t help, of course, but the fact that Taiwan makes 65% of the world’s microchips seems like it’s been an issue. But hey, it stops wars, right! By building a lot of connections between Russia and Europe it brought cheap gas to the continent so they could make cars and Russia got money and McDonald’s and Nissans and it all worked out. Oh… I say all this because Beryll, a large global automotive consulting firm made up of former auto execs, has put out its annual list of biggest automotive suppliers. “Biggest” in this case is determined by revenue and the list is the normal mix of the expected Germans and Japanese (Bosch, Denso, ZF). Tires are there from France (Michelin) and Germany (Continental) and Japan (Bridgestone). Tires make sense because all cars, EVs or otherwise, need tires. What’s interesting is #10. CATL. You may not know who CATL is, but it’s an acronym for Contemporary Amperex Technology Co. Limited. It’s a Chinese company and it jumped 24 places to crack the top 10. What does it do? From CATL: What that means is it makes batteries. They make more batteries for cars than anyone else and its clients include Tesla and Ford, two of the world’s biggest EV companies. What’s the biggest American company on there, you ask? Cummins, at #11. It is, historically, an engine maker and more recently an emissions equipment developer (though it is rapidly trying to diversify by building battery packs). What does the U.S. Managing Director of Beryll’s Martin French want us to take away from all this? Yup. Maybe that’ll keep us from going to war over that island that makes all the chips.
Tesla Says It Is Going To Miss Deliveries Because Of Supplies (Not Demand)
Hey, boy, what a coincidence that the next part of The Morning Dump is Elon Musk complaining that Tesla isn’t going to hit its estimates because of supply chain and logistics issues. Wow, who could have seen it coming? Per Reuters, Musk doesn’t think this is a big deal: He’s probably not lying, though. It’s important to clarify that with Musk’s statements because he tends to stretch the truth a lot. But Tesla said some logistics challenges would persist, with fourth-quarter deliveries growing by less than 50% while production rose 50%. “I wouldn’t say we’re recession proof, but it’s certainly recession resilient,” Musk said. Previously, Tesla had repeatedly said it was aiming for 50% growth this year from the 936,172 cars it delivered in 2021. (Updated for some more context because there’s some debate online as to whether it’s really supply or demand, though the explanation seems reasonable enough and it’ll take at least another quarter to sort out what’s the reality – MH) Here’s the full transcript readout and here’s the key part: Whatever issues they have, Tesla makes great cars that are the most in-demand ones in the world, and the company is the most valuable brand in the world. It will deal with its logistical issues and it will continue to grow, pending anything super weird happening. Specifically on cars in transit, as noted in our press release on October 2, we’ve started to experience limits on outbound logistics capacity which we didn’t anticipate. This issue is particularly present for ships from Shanghai to Europe and local trucking within certain parts of the U.S. and Europe. Our historical operating pattern of batch building by delivery region leads to extreme concentrations of outbound logistics needs in the final weeks of each quarter. Just to put this in perspective, roughly two-thirds of our Q3 deliveries occurred in September and one-third in the final two weeks. As a result, we have begun to smooth the regional builds throughout the quarter to reduce our peak needs for outbound logistics. We expect this to simplify our operations, reduce costs, and improve the experience of our customers. As we look ahead, our plans show that we’re on track for the 50% annual growth in production this year, although we are tracking supply chain risks which are beyond our control. And it’s an American company and Elon Musk is nothing if not a great, patriotic American.
American Government Reportedly Considering A Security Review For Elon Musk Over Things
Welp. According to Bloomberg the White House is maybe gonna want to test my last theory: I’m hoping Elon Musk isn’t trying to speed run Henry Ford’s goodwill-for-building-an-awesome-American-company-to-boy-he-seems-real-friendly-with-fascist-invaders move. I love Twitter and in some ways I worry about what Musk will do with it, and I’m reminded of the time I emailed Musk (long ago this was a thing that very occasionally happened) to invite him to a party on behalf of Gawker founder Nick Denton and, oh, I may have just compared him to Richard Nixon. Musk accepted the invite and signed the email “Nixon,” which was pretty funny. Musk sometimes acts like an 18-year-old boy who never grew up and sometimes it works because 18-year-old boys are occasionally funny. I’m hopeful that if push-came-to-shove that Musk would actually do the right thing, as Henry Ford eventually did. And I’m not sure the Nixon comparison is fair anymore because, well, Nixon recognized the real threat Russia posed.
GM Might Build A Smaller Hummer EV
America is still going to build EVs with or without Musk! We’re going to build the most American EVs ever! We’re going to build some more Hummers! Just maybe ones that aren’t 9,000 pounds and $100k+. This one comes from Automotive News and it’s really not much of a surprise: It’s a sound plan, as far as GM plans go. While Hummer was too weird and ill-timed for its introduction (though it was the perfect automotive consumer brand for the Bush era [Editor’s Note: And it would have been the perfect consumer brand to launch this decade to fight the new Jeep Gladiator, Wrangler, and Bronco. In fact, I once wrote that the “The Hummer H3T Is America’s Dream Truck but It Came Ten Years Too Early.” The Colorado ZR2 is remarkably similar if you look at the specs, except it is two cylinders worse. -DT]. their best product, in my mind, was the Hummer H3T. Sure, it was a dressed up Chevy Colorado, but a dressed up Chevy Colorado is a good thing! In particular, the H3T Alpha seems like it was a great truck. Hummer is emerging as a key piece of GM’s electric-vehicle strategy. The company has said it’s spending $35 billion to build 30 EVs by 2025. It’s breaking into the market by appealing to high-end customers with pricey EVs from Hummer and Cadillac and offering lower-priced models to fleet buyers, allowing the automaker to build sales volume and manufacturing scale.
The Flush
Whelp, time to drop the lid on this issue of The Morning Dump. The one thing I didn’t get into above regarding free trade is NAFTA (the North American Free Trade Agreement). Ross Perot, a magical nymph who sounded like every East Texas Auntie combined, said it would be bad. Bill Clinton and George Bush said it would be good. Was it good? Was it bad? Good for whom? Bad for whom? Photo credits: Top (CATL), Tesla, Tesla, GM There will literally always be demand for Teslas. As much as I loathe apartheid emerald failson Elon, there’s no denying that at the moment he’s leading an absolute juggernaut. Teslas hit at an intersection of desirability that no other manufacturer can at the moment….the people that want them won’t consider anything else, they’re universally recognized status symbols, they appeal to non-enthusiasts in a way that nothing else does, they capture the zeitgeist in a way few cars do, and they’re perceived as more environmentally friendly…so people that care a lot about being green and people who just want to virtue signal want them too. If you grabbed 10 random people off the street right now and asked them what their dream car is, I’ll bet at least half would say a Tesla. At my work parking lot there’s a handful of interesting cars and trucks, but the only one that consistently gets noticed and talked about is the lone Model 3. Normies love Teslas. Sadly Musk will never be held accountable for anything ever because he’s the richest man alive. All of this stuff is just hand wringing. The justice system is literally designed to shield people like Elon from consequences and money will make just about anything go away. I mean is it going to small or American truck small? The current Hummer EV is so laughably massive and unwieldy that I can’t take it seriously, and honestly even Gladiators are comically large to me. I live in the city and whenever I see one parked around normal cars it looks cartoonishly huge. I’d definitely be interested in one of these if it was say…Santa Cruise or Maverick size, but I assume it will be Colorado sized, and that’s too big and it’ll still be shockingly heavy. I want an electric mini truck. There are DOZENS of us! DOZENS! Le Flush: I think it’s best to try to leave politics off this site as much as possible. The couple times the comments have gotten super political it’s more or less looked to me like we have nothing but a lot of people who are on the far ends of their chosen side of the spectrum. I don’t think it lends itself to good conversation. I’d rather come here so we can all talk about neat cars. If I want to get riled up about politics I’ll just ask an older relative what they think of (insert issue here). I’d rather focus on what we all agree on…that cars rule. Also note the full size trucks would likely be super duty/heavy duty top trim 4×4 with a lift, fake bead lock tires and accessory truck nutz. Sticker of Calvin peeing on another automakers brand may also be included. And personally I agree with them. Not to mention the amount of people who need trucks here (farming, hunting/fishing use, poor weather 4wd machine, neighborly “can I borrow your truck” duties) means it tends to have a real positive social outlook. The Ford Lightning and Silverado EVs will be what sways the south. If ranges are high enough, chargers are installed more frequently, and towing is addressed more heavily. Of course no leader would dare the political suicide to address (See Hillary Clinton, deplorables) What you say about cultural contempt is absolutely true – I grew up in Sweden and you would see that attitude amongst 8th grade boys (I would hide good grades), but it had wore off by 10th grade. Here it is a perfectly reasonable stance for leaders of companies, judges, and of course politicians. Not sure how to reverse that trend. A friend of mine quit his job as a music teacher in NYC to become a busker in the subway… not sure what that can teach us but it must mean something. Electric cars are battery cars, and it may be true that battery cars are our future. For an automotive journalist, reporting on the environmental impact of battery production would be a good place to start in helping to address some of these questions. As to the question of the environmental impact of extracting lithium, several studies have shown that the impact of lithium extraction, vehicle construction, and charging batteries is lower than the impact of vehicle construction, petroleum processing, and burning the fuel in an ICE vehicle. It would be even better if even more of the grid were using hydro, solar, geothermal, wind, and nuclear power. Also important is the progress toward other battery chemistries. Carbon batteries look like a pretty solid choice if we can get them sorted. We could potentially capture carbon that would otherwise be released into the atmosphere and use it in batteries down the road. Hydrogen also still looks promising, especially for commercial vehicles, but only if we can reduce the energy needed to create it, which seems possible. NAFTA was bad for the US manufacturing sector, but good for Mexico, and it kept Canada manufacturing. NAFTA or not, the US manufacturing sector was failing because of labor costs and the rise of global supply chains and shipping. With the CHIPS act, companies like TSMC now have incentives to put production on US soil, even if it is a Taiwanese company. And manufacturers are waking up to the idea that putting factories in the US means shortening supply chains, and paying workers to create opportunities for more of their products to be purchased, even if the price of the product is slightly higher. Wages in China have risen to the point where it’s not so economic to do business there. Stellantis CEO Tavares suggests China should be prepared to accept tariff levels on their EVs and other products comparable to the protectionist barriers they raise for outside products. (China with a 15-25% tariff on outside autos, while there is only a 10% tariff on Chinese auto imports). There’s no reason for the world to let China continue with this level of protectionist policies. If the Chinese government wants to subsidize their businesses, at least that is investment. Tesla makes great cars? What are you on and did you bring enough for the class? If you like the Tesla, then rock on with your badself. This is more of a personal choice then the hive mind “Must love all things Elon made”. 🙂 Big picture, without it, North america probably would have lost out in the world economy, especially once the EU came along. “Free trade” is and always was for the big corps, never in the country’s or its people’s interests, which makes sense, since our country is practically ruled by corporations since the Citizens United decision. Free trade’s endgame is having an oligarch class rule over a country of serfs fighting in the streets for rat meat. Or maybe, I dunno, volunteer as a teacher at your local schools. Maybe start a class in critical thinking, speech and debate, science or whatever at your local rec center. Found your own church of science and rational thought. If it bugs you that much get out there and make a difference.
