Volvo is Eliminating Internal Combustion Engines By 2019 (Going Electric)

[Tugg Speedman]

The Auto Industry is going to see an absolutely gut-wrenching change in the next few years.  Then every other industry will see something similar.

Volvo Vaults to Volts, Planning to Pull Plug on Gasoline Engines
https://www.bloomberg.com/news/articles/2017-07-05/volvo-cars-joins-electric-race-with-plan-for-five-battery-models
Swedish carmaker's new models all electrified starting 2019
Tighter emissions rules spur longer ranges, cooler designs
As it turns out, news of the death of the internal combustion engine may not be very exaggerated after all. On Wednesday, Volvo Car Group said it expects to soon start phasing out vehicles powered solely by fossil fuels, joining a parade of manufacturers in shifting toward electrics more quickly than most in the industry expected a few years back. Volvo says it plans to offer only hybrid or full-electric motors on every new model launched in 2019 or later, including five electrics it expects in its lineup by 2021.

How did Wall Street respond to this news?  It destroyed the auto-parts company stocks.

Car parts sellers' stocks fall as O'Reilly, Volvo news cast a pall over sector
http://www.marketwatch.com/story/car-parts-sellers-stocks-fall-as-oreilly-volvo-news-cast-a-pall-over-sector-2017-07-05
O'Reilly Automotive's stock suffers biggest-ever one-day selloff
Shares of auto parts retailers took deep dives on Wednesday after O'Reilly Automotive Inc.'s sales warning and Volvo's plan to phase out conventional combustion engines cast a pall over the sector. O'Reilly's stock (ORLY)  plunged $41.64, or 18.9%, to suffer the biggest one-day price and percentage decline since it went public in April 1993.

O'Reilly Plunges After Sales Miss Estimates
https://www.bloomberg.com/news/articles/2017-07-05/o-reilly-plunges-as-sales-miss-shows-retail-slump-dragging-on
Demand slows for sector as threats loom from Amazon, dealers
Stock rout suggests 'something bigger going on,' analyst says

The point is this news is being taken deadly seriously and not being dismissed in the least.

I noted this in the Minimum wage thread

http://www.muscoop.com/index.php?topic=54395.msg935224#msg935224

Ford fired their CEO in May and replacing him with the head of their autonomous car unit.  That because Ford wants to move as fast as humanly possible into driverless electric cars.  They want to so radically remake their company that is will bear little resemblence to today's company.

I'll let Bill Ford, Chairman of Ford (and owner of the Lions) explain

https://media.ford.com/content/fordmedia/fna/us/en/news/2017/05/22/ford-appoints-jim-hackett-as-ceo.html

"We're moving from a position of strength to transform Ford for the future," Bill Ford said. "Jim Hackett is the right CEO to lead Ford during this transformative period for the auto industry and the broader mobility space. He's a true visionary who brings a unique, human-centered leadership approach to our culture, products, and services that will unlock the potential of our people and our business."

Executive Chairman Bill Ford Jr. and the board have been unhappy with the company's performance and sought reassurance that investments in self-driving cars, electric vehicles and ride services would pay off. The Ford family controls the automaker through a special class of voting rights stock.

Ford Jr. told reporters at a news conference that the automaker needs to make decisions faster.
"We have to modernize the business" and move "decisively to address underperforming areas," he said.

Predictably one poster who works in the automotive industry dismissed all this stuff suggesting the pace of change will be glacially slow.  I say predictably because sometimes the worst people to ask about this are those in that industry because they have a vested interest in seeing the status quo maintained, and that is what they always see.  This is why new tech-oriented companies swoop in and take their business away from them (Uber/taxis).  "Legacy companies" rationalize and dismiss until it is too late.

At least the auto industry gets it.  Instead of rationalizing and dismissing, they are taking perfectly good businesses, like making cars with gasoline engines, and blowing them up out of fear they will get left in the station as the train of progress leaves without them.

This story is going to be repeated over and over in many different industries.

[muwarrior69]

I would not buy an electric car until the battery can be recharged in under 5 minutes and have a driving range of at least 350 miles. I can also see the government taxing all cars by the mile and adding a road tax to our electric bills.

[dgies9156]

I would not buy an electric car until the battery can be recharged in under 5 minutes and have a driving range of at least 350 miles. I can also see the government taxing all cars by the mile and adding a road tax to our electric bills.

I've been in a Tesla and they're incredibly nice -- and quiet. But basically it is an around town car and it takes all night to recharge one. The range probably is pushing 300 miles.

Unless the recharge technology grows exponentially, electric cars are around town cars and will not have the utility of an internal combustion engine.

As for taxing by the mile, are you from Illinois? Don't give our legislature any ideas.

[tower912]

IMHO, the electric car will be limited until there is a universal battery pack similar to what we use in power tools around the house.  Once an infrastructure exists that allows you to swap out a spent battery for a charged one every 200-300 miles, then electric cars can completely replace internal combustion.

[ATL MU Warrior]

The Auto Industry is going to see an absolutely gut-wrenching change in the next few years.  Then every other industry will see something similar.

Volvo Vaults to Volts, Planning to Pull Plug on Gasoline Engines
https://www.bloomberg.com/news/articles/2017-07-05/volvo-cars-joins-electric-race-with-plan-for-five-battery-models
Swedish carmaker's new models all electrified starting 2019
Tighter emissions rules spur longer ranges, cooler designs
As it turns out, news of the death of the internal combustion engine may not be very exaggerated after all. On Wednesday, Volvo Car Group said it expects to soon start phasing out vehicles powered solely by fossil fuels, joining a parade of manufacturers in shifting toward electrics more quickly than most in the industry expected a few years back. Volvo says it plans to offer only hybrid or full-electric motors on every new model launched in 2019 or later, including five electrics it expects in its lineup by 2021.

How did Wall Street respond to this news?  It destroyed the auto-parts company stocks.

Car parts sellers' stocks fall as O'Reilly, Volvo news cast a pall over sector
http://www.marketwatch.com/story/car-parts-sellers-stocks-fall-as-oreilly-volvo-news-cast-a-pall-over-sector-2017-07-05
O'Reilly Automotive's stock suffers biggest-ever one-day selloff
Shares of auto parts retailers took deep dives on Wednesday after O'Reilly Automotive Inc.'s sales warning and Volvo's plan to phase out conventional combustion engines cast a pall over the sector. O'Reilly's stock (ORLY)  plunged $41.64, or 18.9%, to suffer the biggest one-day price and percentage decline since it went public in April 1993.

O'Reilly Plunges After Sales Miss Estimates
https://www.bloomberg.com/news/articles/2017-07-05/o-reilly-plunges-as-sales-miss-shows-retail-slump-dragging-on
Demand slows for sector as threats loom from Amazon, dealers
Stock rout suggests 'something bigger going on,' analyst says

The point is this news is being taken deadly seriously and not being dismissed in the least.

I noted this in the Minimum wage thread

http://www.muscoop.com/index.php?topic=54395.msg935224#msg935224

Ford fired their CEO in May and replacing him with the head of their autonomous car unit.  That because Ford wants to move as fast as humanly possible into driverless electric cars.  They want to so radically remake their company that is will bear little resemblence to today's company.

I'll let Bill Ford, Chairman of Ford (and owner of the Lions) explain

https://media.ford.com/content/fordmedia/fna/us/en/news/2017/05/22/ford-appoints-jim-hackett-as-ceo.html

"We're moving from a position of strength to transform Ford for the future," Bill Ford said. "Jim Hackett is the right CEO to lead Ford during this transformative period for the auto industry and the broader mobility space. He's a true visionary who brings a unique, human-centered leadership approach to our culture, products, and services that will unlock the potential of our people and our business."

Executive Chairman Bill Ford Jr. and the board have been unhappy with the company's performance and sought reassurance that investments in self-driving cars, electric vehicles and ride services would pay off. The Ford family controls the automaker through a special class of voting rights stock.

Ford Jr. told reporters at a news conference that the automaker needs to make decisions faster.
"We have to modernize the business" and move "decisively to address underperforming areas," he said.

Predictably one poster who works in the automotive industry dismissed all this stuff suggesting the pace of change will be glacially slow.  I say predictably because sometimes the worst people to ask about this are those in that industry because they have a vested interest in seeing the status quo maintained, and that is what they always see.  This is why new tech-oriented companies swoop in and take their business away from them (Uber/taxis).  "Legacy companies" rationalize and dismiss until it is too late.

At least the auto industry gets it.  Instead of rationalizing and dismissing, they are taking perfectly good businesses, like making cars with gasoline engines, and blowing them up out of fear they will get left in the station as the train of progress leaves without them.

This story is going to be repeated over and over in many different industries.

The article doesn't say what your click bait headline says. 

Electric cars are a big part of the future. They are coming and relatively soon. What isn't coming anytime soon is a radical change to a distribution model that excludes dealers.  At least not for those manufacturers that are currently operating under that model.

Oh, and using Volvo as some indicator of broader industry trends is amusing.  They have 0.4% market share and have sold fewer cars this year than the mighty Dodge brand sold in June.  What they do doesn't matter in the broader scheme of things.

[forgetful]

I would not buy an electric car until the battery can be recharged in under 5 minutes and have a driving range of at least 350 miles. I can also see the government taxing all cars by the mile and adding a road tax to our electric bills.

The article says hybrid or electric, so the internal combustion engines are not going away (hybrids still use an internal combustion engine), and the hybrids have as much range as you want. 

[Jockey]

The article doesn't say what your click bait headline says. 

Electric cars are a big part of the future. They are coming and relatively soon. What isn't coming anytime soon is a radical change to a distribution model that excludes dealers.  At least not for those manufacturers that are currently operating under that model.

Oh, and using Volvo as some indicator of broader industry trends is amusing.  They have 0.4% market share and have sold fewer cars this year than the mighty Dodge brand sold in June.  What they do doesn't matter in the broader scheme of things.

Typical Heisy.

His attempts to show his superior knowledge inevitably fail.

[MU82]

The article says hybrid or electric, so the internal combustion engines are not going away (hybrids still use an internal combustion engine), and the hybrids have as much range as you want.

This.

I saw the same article. Adding hybrids makes the focus VERY different. I would guess that Volvo will produce mostly hybrids and VERY few electric-only, especially the first decade or so.

My wife drives a Hyundai Sonata Hybrid to and from work, a commute done mostly at 30-45 mph. She gets 650+ miles per tankful. The car is comfortable, quiet, reasonably fast and gets about 42 mpg.

This is the kind of car Volvo (and most others) will be developing for some time. Not until Tesla or somebody else shows you can mass-produce an affordable electric that has a great driving range and can sell big without government subsidies will there be a monumental shift. And even then, change will come gradually.

As for the tax issue ... I believe SC already has added a small tax (around $100/yr IIRC) for owners of hybrids and electrics to make up for lost gas-tax revenue, and NC is considering the same. It seemed outrageous when I first heard about it, but I guess it makes sense. If you are going to fund the roads with a gas tax, and the cars on the road are using less gas because of hybrid/elec technology, you have to come up with road-upkeep money somehow.

[Tugg Speedman]

This.

I saw the same article. Adding hybrids makes the focus VERY different. I would guess that Volvo will produce mostly hybrids and VERY few electric-only, especially the first decade or so.

My wife drives a Hyundai Sonata Hybrid to and from work, a commute done mostly at 30-45 mph. She gets 650+ miles per tankful. The car is comfortable, quiet, reasonably fast and gets about 42 mpg.

This is the kind of car Volvo (and most others) will be developing for some time. Not until Tesla or somebody else shows you can mass-produce an affordable electric that has a great driving range and can sell big without government subsidies will there be a monumental shift. And even then, change will come gradually.

As for the tax issue ... I believe SC already has added a small tax (around $100/yr IIRC) for owners of hybrids and electrics to make up for lost gas-tax revenue, and NC is considering the same. It seemed outrageous when I first heard about it, but I guess it makes sense. If you are going to fund the roads with a gas tax, and the cars on the road are using less gas because of hybrid/elec technology, you have to come up with road-upkeep money somehow.

No internal combustion engines only in 2019.  Hybrids and electrics only after that.  5 new models that are electric only in 2021.  The auto-part companies were killed on the news.

Oh, and there is this ...

France to ban sales of petrol and diesel cars by 2040
https://www.theguardian.com/business/2017/jul/06/france-ban-petrol-diesel-cars-2040-emmanuel-macron-volvo


But, you're right, nothing here.

[Tugg Speedman]

The article doesn't say what your click bait headline says. 

Electric cars are a big part of the future. They are coming and relatively soon. What isn't coming anytime soon is a radical change to a distribution model that excludes dealers.  At least not for those manufacturers that are currently operating under that model.

Oh, and using Volvo as some indicator of broader industry trends is amusing.  They have 0.4% market share and have sold fewer cars this year than the mighty Dodge brand sold in June.  What they do doesn't matter in the broader scheme of things.

You work in the auto industry and your first instruct is to rationalize and dismiss.  This is the exact mentality that destroyed retailing, taxis, hotels, advertising, etc. 

And this is the same mentality that Mark Fields had at Ford.  Now he is the former CEO.

Good luck to you.

[Tugg Speedman]

I would not buy an electric car until the battery can be recharged in under 5 minutes and have a driving range of at least 350 miles. I can also see the government taxing all cars by the mile and adding a road tax to our electric bills.

Battery swap in less than 5 minutes will be the answer.

Telsa also has rapid charging station around the country that can recharge in under 30 minutes.

[ATL MU Warrior]

You work in the auto industry and your first instruct is to rationalize and dismiss.  This is the exact mentality that destroyed retailing, taxis, hotels, advertising, etc. 

And this is the same mentality that Mark Fields had at Ford.  Now he is the former CEO.

Good luck to you.

Thanks!

[jesmu84]

You work in the auto industry and your first instruct is to rationalize and dismiss.  This is the exact mentality that destroyed retailing, taxis, hotels, advertising, etc. 

And this is the same mentality that Mark Fields had at Ford.  Now he is the former CEO.

Good luck to you.

"destroyed"? So those industries are non-existent now?

[MU82]

No internal combustion engines only in 2019.  Hybrids and electrics only after that.  5 new models that are electric only in 2021.  The auto-part companies were killed on the news.

Oh, and there is this ...

France to ban sales of petrol and diesel cars by 2040
https://www.theguardian.com/business/2017/jul/06/france-ban-petrol-diesel-cars-2040-emmanuel-macron-volvo


But, you're right, nothing here.

Dearest Smuggles:

Please show me where anything I wrote in my post said NOTHING HERE. If you can, I will buy you $1,000 worth of AAPL. But you can't, so I'll take the $1,000 worth of your favorite stock. Thanks!

As usual, you take an interesting subject that has merit and exaggerate the hell out of it. And then you double down by taking a response to your post and reading too much into that before delivering an inaccurate, silly line.

But hey ... That's our Smuggles!

Love,
MU82

[🏀]

Replacing the Motor Fuel Tax is an interesting debate. I honestly think the only solution is a per car tax. The current model is broken already and only continues to further under fund.

[muwarrior69]

Battery swap in less than 5 minutes will be the answer.

Telsa also has rapid charging station around the country that can recharge in under 30 minutes.

I would imagine that would require the government to mandate that all manufacturers use a standard battery pack, thereby eliminating competition and new innovative battery technology.

[tower912]

I think a standard will be adopted, but I highly doubt it will stop innovation.  There will be a constant challenge to get more capacity in a given size.  IMO, we are at least a decade away from this level of development and the creation of an adequate infrastructure to support the recharging and quick swap outs.

[Tugg Speedman]

"destroyed"? So those industries are non-existent now?

profitability and outlook

[#UnleashSean]

This.

I saw the same article. Adding hybrids makes the focus VERY different. I would guess that Volvo will produce mostly hybrids and VERY few electric-only, especially the first decade or so.

My wife drives a Hyundai Sonata Hybrid to and from work, a commute done mostly at 30-45 mph. She gets 650+ miles per tankful. The car is comfortable, quiet, reasonably fast and gets about 42 mpg.

This is the kind of car Volvo (and most others) will be developing for some time. Not until Tesla or somebody else shows you can mass-produce an affordable electric that has a great driving range and can sell big without government subsidies will there be a monumental shift. And even then, change will come gradually.

As for the tax issue ... I believe SC already has added a small tax (around $100/yr IIRC) for owners of hybrids and electrics to make up for lost gas-tax revenue, and NC is considering the same. It seemed outrageous when I first heard about it, but I guess it makes sense. If you are going to fund the roads with a gas tax, and the cars on the road are using less gas because of hybrid/elec technology, you have to come up with road-upkeep money somehow.

I get 48mpg in my diesel. But I only get around 550 per tank. How big is her tank?

[GGGG]

I get 48mpg in my diesel. But I only get around 550 per tank. How big is her tank?

Doesn't matter how big her tank is...only how she uses it.

[🏀]

I get 48mpg in my diesel. But I only get around 550 per tank. How big is her tank?

Let's find out how big her trunk is first!

[LloydsLegs]

Fake news.  Not what the article says at all.  Many correctives since it was published.  Internal combustion engines continue for the medium term at Volvo as part of hybrids (as others have pointed out). 

What actually is interesting is to follow the money - the real story is Chinese ownership interest in Volvo and the impact that has on direction of company, including where vehicles are manufactured (including those bound for USA).

[muwarrior69]

I think a standard will be adopted, but I highly doubt it will stop innovation.  There will be a constant challenge to get more capacity in a given size.  IMO, we are at least a decade away from this level of development and the creation of an adequate infrastructure to support the recharging and quick swap outs.

Are not the batteries in an all electric car the major component contributing to the weight of the car? If true, I would like to know how, "quick", will be defined and where will these "packs" be located in the automobile for the swap out.

[Spotcheck Billy]

Replacing the Motor Fuel Tax is an interesting debate. I honestly think the only solution is a per car tax. The current model is broken already and only continues to further under fund.

a mileage tax is likely IMO, I believe some states are already experimenting with this

[MarquetteDano]

a mileage tax is likely IMO, I believe some states are already experimenting with this

That would be fairer.  I only drove my car about 6,000 miles a year.  A per car tax is not as equitable.