Tag Archives: EVs

BYD is not first world competition for Tesla

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In Q4 2023, BYD became the world’s largest electric vehicle (EV) manufacturer, passing Tesla in world wide sales. They mostly sell in China, and claim to make a profit while selling cars for about half the price of a Tesla. They also make robots, trucks, busses, smart phones, and batteries — including blade batteries that Tesla uses for a variant in its Berlin facility. They are a darling of the wall-street experts, in part because Warren Buffett is an investor. BYD cars look to be about as nice as Tesla’s at least from the outside and sell (In China) for a fraction of the price. The experts are convinced enough to write glowing articles, but I suspect that the experts have not invested, nor bought BYD products. — What do I know?

BYD truck. It looks good on the outside. Is it competition?

Part of the BYD charm is that it is considered socially progressive, while Tesla is seen as run by a dictatorial villain. A Delaware judge who concluded that Musk did non deserve the majority of his salary, and confiscated it. There are no such claims against BYD. BYD also has far more models than Tesla, 41 by my count, compared to Tesla’s 4. The experts seem to believe that all BYD has to do is bring their low-cost cars west, and they will own the market. My sense is that, if that was all they needed, they’d have done it already. I strongly suspect the low cost cars that are the majority of BYD’s sales are low quality versions — too low to sell in the US. Here are some numbers.

Total number of vehicles made 2023:
Tesla: ~1,800,000
BYD: ~3,020,000 (1,570,000 BEV)

Employees 2023: Vehicles / Employee 2023:
Tesla: ~140,000 Tesla: 12.86
BYD: ~631,500 BYD: 5.03

Gross Revenue 2023: Gross revenue per vehicle:
Tesla: ~$96.8B Tesla: $53,900
BYD: ~ $85B BYD: $28,100

Net Profit 2023: Profit per employee: Profit per vehicle:
Tesla: ~$9.5B (9.7%). Tesla: $67,857. Tesla: $5,280.
BYD: ~$3.5B (4.1%). BYD: $5,542. BYD: $1,160

Market share based on sales in western countries 2023:
Tesla: US: 4%, EU: 2.6%
BYD: US: 0%, EU: 0.1%

The most telling comparison, in my opinion, is BYD’s tiny market share in western countries. Their cars sell for 1/2 what Tesla’s sell for. If their low-cost cars were as good as Tesla’s, there is no way their market penetration would be so low. My sense is that the average BYD vehicle is lacking in something. Maybe they’re underpowered, or poorly constructed, unsafe, or unreliable: suitable only for China, India, or other poor markets. I suspect that the cars BYD sells in Europe are made on a separate line. Even so, customers say that BYD cars feel “cheap.” BYD charges more for these cars in Europe than Tesla charges for its top sellers, suggesting that these vehicles are of a different, better design. Even so, the low numbers suggest that BYD does not turn a profit on the sales. I suspect they do it for PR.

Both cars look sporty. Why doesn’t the BYD sell?

Another observation is that BYD produces 5.03 vehicles per worker, per year. That’s half as many as Tesla workers produce per worker-year. It’s also about half of Ford’s Rouge plant (Detroit) worker production in the 1930s. That Ford plant was vertically integrated starting with raw materials and outputting finished cars. This low output per worker suggests that BYD is built on low wage, low skill production, or equally damning, that none of these models are really mass-produced.

A first world market favors a polished product that your mechanic is somewhat familiar with. That favors Tesla as it has significant market penetration, and a network of mechanics. Also, Tesla has built up a network of fast charge stations and reliable service providers. BYD has no particular charging infrastructure and virtually no service network. Charging price and experience is a key decider among first world customers. No American will tolerate slow charging in the snow at a high price — especially if they must travel to a charger without being sure the charger will be working when they get there. Tesla has figured out how to make charging less painful, and that’s worth a lot.

Tesla might fail, but if so I don’t think it will be because of BYD success. Months ago the experts assured us that cybertruck would be deadly a failure. I disagree, but it might be. I don’t think BYDs will be better. Government subsidies have ended in many states and countries (Germany, California…) putting a dent in Tesla sales, and they are having manufacturing difficulties, particularly with batteries. These seem fix-able, but might not be. I see relatively little first world competition in the US EV market from legacy auto companies. Maybe they know to avoid EVs. They currently make decent products, IC and EV, but lose money on every EV. They treat EVs as a passing fad. If they are right, Tesla and BYD will fail. If they are wrong, Tesla will do fine, and they may not be able to make up their lost place in the market. As for BYD, given their low production numbers, they will need some 3 million new workers and many new factories. I don’t think they can find them, nor raise the money for the factories.

Most of the data here was taken from @NicklasNilsso14. All of the opinions are mine.

Robert Buxbaum February 18, 2024.

Cybertruck an almost certain success

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Leading up to the Cybertruck launch 4 weeks ago, the expert opinion was that it was a failure. Morgan Stanley, here dubbed it as one, as did Rolling Stone here. Without having driven the vehicle, the experts at Motor trend, here, declared it was worse than you thought, “a novelty” car. I’d like to differ. The experts point out that the design is fundamentally different from what we’ve made for years. They claim it’s ugly, undesirable, and hard to build. Ford’s F-150 trucks are the standard, the top selling vehicle in the US, and Cybertruck looks nothing like an F-150. I suspect that, because of the differences, the Cybertruck can hardly fail to be a success in both profit and market share.

Cybertruck pulls a flat-bed trailer at Starbase.

Start with profit. Profit is the main measure of company success. High profit is achieved by selling significant numbers at a significant profit margin. Any decent profit is a success. This vehicle could trail the F-150 sales forever and Musk could be the stupidest human on the planet, so long as Tesla sells at a profit, and does so legally, the company will succeed. Tesla already has some 2 million pre-orders, and so far they show no immediate sign of leaving despite the current price of about $80,000. Unless you think they are all lying or that Musk has horribly mispriced the product, he should make a very decent profit. My guess is he’s priced to make over $10,000 per vehicle, or $20B on 2 million vehicles. Meanwhile, no other eV company seems to be making a profit.

The largest competing electric pickup company is Rivian. They sold 16,000 electric trucks in Q3 2023, but the profit margin is -100%. This is to say, they lose $1 for every $1 worth of sales –and that’s unsustainable. Despite claims to the contrary, a money-losing business is a failure. The other main competitors are losing too. Ford is reported to lose about $50,00 per eV. According to Automotive News, here, last week, Ford decided to cut production of its electric F-150, the Lightning, by 50%. This makes sense, but provides Cybertruck a market fairly clear of US e-competition.

2024 BYD, Chinese pickup truck

Perhaps the most serious competitor is BYD, a Chinese company backed by the communist government, and Warren Buffet. They are entering the US market this month with a new pickup. It might be profitable, but BYD is relatively immune to profitability. The Chinese want dominance of the eV market and are willing to lose money for years until they get it. Fortunately for Tesla, the BYD truck looks like Rivian’s. Tesla’s trucks should exceed them in range, towing, and safety. BYD, it seems, is aiming for a lower price point and a different market, Rivian’s.

A video, here, shows the skin of a Cybertruck is bulletproof to 9mm, shotgun, and 45 caliber machine gun fire. Experts scoff at the significance of bulletproof skin — good for folks working among Mexican drug lords, or politicians, or Israelis. Tesla is aiming currently for a more upscale customer, someone who might buy a Hummer or an F-250. This is more usable and cheaper.

Don’t try this with other trucks.

Another way Cybertruck could fail is through criminal activity. Musk could be caught paying off politicians or cheating on taxes or if the trucks fail their safety tests. So far, Cybertruck seems to meet Federal Motor Vehicle Safety Standards by a good margin. In a video comparison, here, it appears to take front end collisions as well as an F-150, and appears better in side collisions.

This leaves production difficulty. This could prevent the cybertruck from being a big success, and the experts have all harped on this. The vehicle body is a proprietary stainless steel, 0.07″ thick. Admittedly it’s is hard to form, but Tesla seems to manage it. VIN number records indicate that Tesla had delivered 448 cybertrucks as Friday last week, many of them to showrooms, but some to customers. Drone surveys of the Gigafactory lot show that about 19 are made per day. That’s a lot more than you’d see if assembly was by hand. Assuming a typical learning curve, it’s reasonable to expect some 600 will be delivered by December 31, and that production should reach 6000 per month in mid 2024. At that rate, they’ll be making and selling at the same rate as Rivian or Ford, and making real money doing it. The stainless body might even be a plus, deterring copycat competition. Other pluses are the add-ons, like the base-camp tent option, a battery extension, a ramp, and (it’s claimed) some degree of sea worthiness. Add-ons add profit and deter direct copying (for a time).

Basecamp, tent option.

So why do I think the experts are so wrong? My sense is that these people are experts because of long experience at other companies — the competitors. They know what was tried, and that innovation failed. They know that their companies chose not to make anything like a Cybertruck, and not to provide the add-ons. They know that the big boys avoid “novelty cars” and add-ons. There is an affinity among experts for consensus and sure success, the success that comes from Chinese companies, government support and international banking. If the Cybertruck success is an insult to them and their expertise. Nonetheless, if Cybertruck succeeds, they will push their companies towards a more angular design plus add-ons. And they will claim cybertruck is no way novel, but that government support is needed to copy it.

Robert Buxbaum, December 25, 2023.

A clever range extender for EVs

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Electric vehicles work well for short trips between places where you can charge with cheap electricity. Typically that’s trips from home to a nearby place of work, and to local shopping malls and theaters with low-cost charge spots. If you drive this way, you’ll pay about 3.2¢/mile for home electricity, instead of about 17¢/mile for gasoline transport (e.g. 24 mpg with $4/gallon gas). Using an EV also saves on oil changes, transmission, air filters, belts, etc., and a lot of general complexity. Battery prices are still high, but much lower than they were even a few years ago.

The 10 kW Aquarius Engine is remarkably small and light, about 10kg (22 lb).

EVs are less attractive for long trips, especially in the cold. Your battery must provide the heat, as there is no waste heat from the engine. Expect to have to recharge every 200 -250 miles, or perhaps twice in the middle of a long trip. Each charge will take a half-hour or more, and fast charging on the road isn’t low cost. Expect to pay about 15¢/mile, nearly as much as for gasoline. See my full comparison of the economics here.

One obvious solution is to have two cars: a short commuter and an EV. Another solution is a hybrid. The Toyota’s Prius and the Chevy Volt were cutting edge in their day, but people don’t seem to want them. These older hybrids provided quick fill-ups, essentially infinite range, and about double the gas milage of a standard automobile, 30-45 mpg. The problem is you have even more complexity and maintenance than with even a gas automobile.

Aquarius liner engine as a range extender

I recently saw a small, simple, super-efficient (they say) gas engine called Aquarius. It provides 9.5 kW electric output and weighs only 22 lbs (10 kg), see picture above. A Tesla S uses about 16 kW during highway driving, implying that this engine will more than double the highway range of a Tesla S at minimal extra weight and complexity. It also removes the fear of being stranded on the highway, far from the nearest charge-station.

The energy efficiency is 34%, far higher than that for normal automobile engines, but fairly typical of floating piston linear engines. The high efficiency of these engines is partly due to the lack of tapper valves, risers, crank-shaft, and partially due to the fact that the engine always runs at its maximum power. This is very close to the maximum efficiency point. Most car engines are over sized (200 hp or so) and thus must run at a small fraction of their maximum power. This hurts the efficiency, as I discuss here. The Aquarius Engine makes electricity by the back-forth motion of its aligner rods moving past magnetic stator coils. Slots in the piston rod and in the side of the cylinder operate as sliding valves, like in a steam engine. First versions of the Aquarius Engine ran on hydrogen, but the inventors claim it can also run on gasoline, and presumably hythane, my favorite fuel, a mix of hydrogen and natural gas.

At the moment shown, slit valves in the piston rod are open to both cylinder chambers. The explosion at left will vent to the exhaust at left and out the manifold at top. The sliding valve is currently sending fresh air into the cylinder at right, but will soon send it into both cylinders to help scavenge exhaust and provide for the next cycle; engine speed and impression are determined by the mass of the piston.

A video is available to show the basic operation (see it here). The drawing at right is from that video, modified by me. Air is drawn into the engine through a sliding valve at the middle of the cylinder. The valve opens and closes depending on where the piston is. At the instant shown in the picture, the valve is open to the right. Air enters that chambered is likely exiting through slits in the hollow piston rod. It leaves through the manifold t the top, pushing exhaust along with it. When the piston will have moved enough, both the slits and the intake will close. The continued piston motion (inertially driven) will compress the air for firing. After firing, the piston will move left, generating electricity, and eventually opening the slit-valve in the piston to allow the exhaust to leave. When it moves a little further the intake will open.

The use of side-opening exhaust valves is a novelty of the “Skinner UniFlow” double-acting, piston steam engines, seen on the Badger steamship on Lake Michigan. It’s one of my favorite steam engine designs. Normally you want a piston that is much thicker than the one in the drawing. This option is mentioned in the patent, but not shown in the drawing.

Aquarius is not the only company with a free-piston range extender. Toyota built a free-piston extender of similar power and weight; it was more complex but got higher efficiency. It has variable compression though, and looks like a polluter. (the same problems might affect the Aquarius) They dropped the project in 2014. Deutsch Aerospace has a two headed version that’s more powerful, but long and heavier: 56kg and 35kW. Lotus has a crank-piston engine, also 56kg, 35kW; it’s more complex and may have service life issues, but it’s compact and relatively light, and it probably won’t pollute. Finally, Mazda is thinking of bringing back its Wankel rotary engine as a range extender. Any of these might win in the marketplace, but I like the Aquarius engine for its combination of light weight, compact size, and simplicity.

This is not to say that Aquarius motors is a good investment. Aquarius automotive went public on the Toronto exchange in December, 2021, AQUA.TA. The company has no profits to date, and the only chance of them making a profit resides in them getting a good licensing deal from an established company. The major car companies have shown no interest so far, though they clearly need something like this. Their plug in hybrids currently use standard-size, 4 stroke engines: 110-150 kW, 100-150 kg, complex, and low efficiency. Consumers have not been impressed. Tesla autos could benefit from this engine, but Musk shows no interest either.

Robert Buxbaum May 5, 2022. I have no stock in Aquarius motors, nor have I received any benefits from them, or any auto company.