There is a fundamental truth you have to understand about car companies:They do not exist to make cars. They exist to make money. That distinction, analyst Kevin Tynan tells me, is why they’re not really interested in making affordable electric vehicles.
Perhaps that’s an oversimplification. Tynan is the director of research at an auto-dealer-focused investment bank, the Presidio Group, with decades of experience as an analyst at firms like Bloomberg Intelligence. What he means isn’t that automakers have no interest in affordable products. It’s that their interest begins and ends with winning customers who will eventually buy more expensive, higher-margin products.
One of the auto industry’s dirtiest secrets is that at scale, it doesn’t cost that much more to make a bigger, more expensive than a smaller and cheaper one. But they can charge you a lot more for the former, which makes this a game of profit margins and not just profits. In recent years especially, that’s a big part of why your new car choices have skewed so heavily toward bigger crossovers, SUVs and trucks.
Getting rid of the gas tax and switching to a mileage tax that factors in vehicle weight would help with this. If it costs you more every year to drive a bigger, heavier car, you’re going to want something smaller.
I like the idea of a size tax.
I also like the idea of extended driver’s license requirements to drive some of these monsters vs a sedan.
California is basically doing tax trials based on total mileage travelled per year, but not size.
My understanding from people I know in the CA Govt. legislature is that they have to tax based on what is known and one could easily have modifications on vehicles that would go unnoticed (truck lift kits, rice burners, hack jobs, etc). Mileage otoh is submitted during tax season already.
Very few, if any, modifications are going to dramatically change a vehicle’s curb weight. Of course, electrics weigh more than similar ICEs, so a better reason to skip a weight based tax is so as to not disincentivize electrics.
Edit: Also, what do you mean “rice burners”? Afaik, rice burner refers to any vehicle of Asian origin whether tuned or not. And trust me, tuning a car is not going to increase the curb weight by more than a few pounds.
Sorry, I got ahead of myself without clarifying. The idea of taxation based on the size of “stock” vehicles or even a stock vehicles estimated mpg was turned down because considerations such as: Vehicle Body Modifications, Vehicle Engine Modifications, 5th Wheels, Trailers, Poorly Tuned or Mal-Maintained Vehicles and many others listed means the end result would be a poor assessment for more than 2% of registered vehicles and thus resulting in not taxing appropriately.
So while they can do it (tax by size or empg) by pulling any data that the DMV or tax filings show, those considerations hamper the idea’s effectiveness in taxation for the California Department of Tax and Fee Administration (CDTFA).
As a result, Road Charge (mileage) was adopted in CA as the future replacement for the existing 7.5% + gas tax. https://caroadcharge.com/
We have a gas guzzler tax but for some reason trucks and SUVs are exempted…
As long as they do it by checking the odometer once a year and not with some kind of ridiculous privacy-destroying GPS-based scheme, I’m all for it.
(There are some dipshits who try to justify the latter by claiming they need to know where you drive to send the revenue to the right jurisdiction. Bullshit! They can just measure traffic volumes on each road segment – which they already do – and allocate proportional to that instead.)
Agreed you don’t need the mileage aspect just weight and VAT. However your insurance company app is likely already pulling GPS shenanigans and if your OnStar or whatever “roadside assistance” GPS box and cellular modem are enabled a lot more than just your location are being shared with anyone willing to pay for it.
Not on me, they aren’t. My newest vehicle is from the mid-2000s and none of them have tracking built in.
On a related note, I can’t own an
EVelectric car because nobody will sell me one that respects my privacy.Edit: I do own several EVs: they’re bicycles, not cars. (They are my and my wife’s “daily drivers,” though.)
I disabled the OnStar box on mine and went over it with a flipper zero. Overkill I know but it was a fun afternoon seeing just how many radios and how much signal generation there is in a modern vehicle.
The only radio now is remote start and key auth.
Sidenote if you have an older car you might want to get an OBD2 lock, they’re 30 bucks and are a pretty handy theft deterrent. Metal ones tend to be better.
My manual transmissions are an even better theft deterrent at this point I think, LOL!
(Also, my two oldest cars predate OBD2.)
I never even considered using my flipper to check for outbound signals. I have been wanting to track down the installed LoJack for a while and make sure it’s properly disabled, that might help.
I’m sure you’ve seen it but this guide got me started
The problem with that is that EVs are heavier, meaning that smaller EVs would be taxed at the same level as SUVs or trucks. But it might at least incentivise people to go for smaller ICEs, and switching to mileage tax might be necessary anyway.
The problem with that is that EVs are heavier
I wish this myth would die already. EVs are only heavier when they make them giant and obscenely inefficient, requiring larger and larger batteries.
Small EVs are comparable in weight to their comparable gas models.
I up voted you because the weights aren’t that drastically different rn, but a Chevy Bolt is 3500lb while a larger civic with more cargo and passenger room is 3000.
Something like a Civic is also going to be one of the lightest cars on the road. I’d argue a more comparable vehicle to a Chevy Bolt would be another crossover SUV.
- Mazda CX5 ~3700
- Honda CR-V ~3500
- Rav4 ~3500
- VW Tiguan ~3800
- Subaru Forester ~3500
- Hyundai Tucson ~3500
But the bolt ev is a hatchback. The bolt EUV which is a small crossover is 3700lb, so comparing it to mid and large size crossovers is unfair to them, as they have more cargo and passenger room.
The CX3 weighs 3000lb, the Crosstrek is 3300lb, Honda HRV is 3200, the Taos is 3200lb, the Corolla cross is 3200lb, etc.
In the category of mid/large crossovers, a Model Y is 4200lb, an ID4 is 4500lb, and ioniq 5 is roughly 4200lb, an ev6 is 4200lb etc. and most of these go way higher too with long range options.
But the bolt ev is a hatchback.
A GTI is a hatchback. The Bolt EV is a crossover.
The bolt EUV which is a small crossover is 3700lb
Okay but…we weren’t talking about the EUV.
Not that it matters because a couple hundred pounds here or there ain’t making any sort of significant difference.
Lol what? Then why’d you bring up the weight of a bunch of random SUVs? In that case, EVs are super heavy. My Miata weighs 2000lb and the hummer EV weighs 10,000lb. That’s definitely more than a few hundred pounds difference.
Even if you don’t make them giant and obscenely inefficient, a 100kwh pack is gonna weigh over 300kg. Doesn’t matter if that gives it 1000 miles of range or 400 miles.
And how much does an internal combustion engine, a transmission, a fuel tank, a driveshaft, a starter motor, and an oil sump weigh?
Typically, less. EVs are consistently 10%-15% heavier than equivalent ICEs.
Weight is just not one of the advantages that EVs have over ICEs. This is not the hill you want to die on.
Fortunately, all the other advantages greatly exceed that weight penalty.
Probably about the same as such a battery, maybe a little less? The electric motor is still gonna push the EV weights above the equivalent ICE by a little. Either way, neither is gonna be comparable to the much larger vehicles on roads. Which includes buses (which I don’t think we should be trying to disincentivize although it should be considered in the planning stages of deciding between BRT and alternatives like rail). But due to the 4th power law, if we scaled taxes based on damaged done to roads, the only consumer vehicles (excluding things like trailers) that would even notice the tax would be a the few at the highest end.
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You don’t need a 100kWh pack. Most of the smaller cars are closer to 60.
If you’re comparing an ICE vehicle that can get 400 miles a tank to an EV then you are being completely disingenuous to compare it to an EV that only gets 100-150 miles of range. They’re not comparable. An EV that gets even close to the same range is going to way much much more than a comparable ICE vehicle.
If you got 400 miles on a 100kWh pack you’ll be getting 300 on a 60kWh pack.
It completely depends on your drive configuration and aerodynamic efficiency rating. Also I don’t know why you think I said anything about getting 400 miles on a 100kWh pack. This conversation is about weight. You don’t just get to say “get a smaller battery pack and then the cars weight the same” because it makes them completely different cars. The average ICE vehicle (of the top25 sold) gets 460 miles of range. https://insideevs.com/features/527446/electric-cars-range-equilibrium/ (funny enough this article is literally what we’re arguing about!)
In any case, I’m not even arguing for larger batteries! I’m just stating that you can’t compare weight if you aren’t going to compare range. They go hand in hand.
No it’s not? 400 miles of range is completely unnecessary.
400 miles of range is 5 hours of driving (plus enough reserve to comfortably skip a busy, broken, blocked, or skeevy recharging point), recharge over lunch, and another 5 hours of driving. 400 mile range is where road trips become feasible.
400 miles of range, in the mountains, is 150 miles of range.
It’s not. I own a very nice EV. I can make arguments for and against both EVs and ICE vehicles. If you are comparing battery size (which you did) then you are talking about range. If you are talking about range then you are comparing against ICE vehicles which have ranges from 350 miles to over 600. I used 400 because I own two ICE vehicles with that amount of range and one EV with 265 miles of range. The 265 miles is plenty for everyday stuff, it’s even good for road trips! But you made a comparison of weight. EVs are much heavier if they have equivalent range.
I certainly don’t and wouldn’t consider it. But if someone wants 1000 miles of range, we probably aren’t getting that without some major technological breakthroughs in material sciences any time soon without packs around 100kWh.
We don’t need 1000 miles of range…all we need is more charging stations.
Lack of a need for that won’t stop people from getting them if that’s an option…
What people need and what people irrationally want can be two different things
My very compact SparkEV is a retrofit, so the same body as the ICE version: the battery is tiny at 19kwh but it’s still like having an extra passenger and then some. You can feel the weight and stiffened suspension when driving.
But isn’t it the weight that does more damage to the roads that the taxes are intended to pay for?
the weight does damage yes, but the lionshare of road damage is caused by shipping trucks because they are magnitudes heavier than a civilian vehicle while loaded. It’s the reason truck weigh stations exist
…and a weight based tax would put the lion’s share of the tax burden on shipping trucks.
I think we’re in agreement here?
Do you think an electric car that weighs 1000lbs more than similar ICE cars is doing that much more damage to the road? And compare the damage cars, suvs, etc, would do versus box trucks, tractor-trailers, etc. There is no comparison to the damages between the two classes of vehicles. While true, an SUV will do more damage to the road than an econobox hatchback, even combined they don’t equal the damage a fully loaded tractor-trailer will do.
I’m not sure your point here. It sounds argumentative but in fact I think we agree?
I think the damage is proportional to the weight so taxing based on weight makes sense.
Their point is even if there’s a 1000 lb. difference here or there, it’s not gonna make any significant difference to road wear.
Only when you get to 40-80k lb. commercial vehicles does it make a significant difference.
It also does not compensate at all for the fact that some small EVs weigh 3500lbs. while a Chevy Suburban weighs 6k lbs.
Yeah. Car registration pays for road maintenance. EVs are still paying for that.
No, EV taxes are intended to compensate for loss of road taxes that are imposed on gasoline. The problem is it’s a flat fee. So if you’re like me and live in Texas and drive a normal-sized 3600lb. Model 3, you pay the same (patently-insane) fee as a 9k Hummer EV.
I just didn’t renew my registration. Cops around here don’t do shit anyway.
But that would disproportionately hit poor people. Generally they have to live farther out, where rents are cheaper, and in much of the US public transit is a pile of shit.
Hell, even in places where it isn’t it’s still painfully inconvenient. I live in a fairly transit-friendly city, and it takes my husband 45 minutes to an hour to get to work by transit, or 10-12 minutes by car.
How far is he from work? If your city has the right transit chops, an ebike might actually put both a car and transit to shame. Drives that take an hour by bus or 35 minutes by car take 26 minutes or less in my city, due to godawful traffic. But the bike lanes have no traffic lights and cut straight through massive areas, instead of block by block streetlights.
The problem is there are no easy safe bike paths directly there; he would have to either ride out of his way to one or travel part of the way on narrow fast roads that have a lot of box-truck and semi-truck traffic. Or get on the freeway for a stretch, which is also bad in different ways.
The bike paths that there are, are pretty nice, but they’re more geared towards ‘enjoy a ride along the river’ and less towards ‘get from the inner city out and back again quickly’.
But yes, when he is willing to take those risks, it’s about a half-hour or so to get to work.
I’ve noticed this a lot in industrial areas; no-one seems to think you’d want to ride a bike there, so they don’t bother with infrastructure. Unless it’s in the inner city, but in that case it’s more a thing of happenstance since there are bike paths already surrounding the area so it’s less work to add a few connecting paths.
Yeah, hopefully that is shifting a bit more. When a bike system works, it is really nice. But many cities are just now realizing that they can be more than toys. It took our city to a breaking point before they realized that there was no physical room to keep adding lanes to the highways and roads around the city now that things have been built up. We still have traffic so bad that it can take upwards of an hour to move two blocks, though. That’s starting to change now, finally.
Busting all the out of state registrations would also net a boat load of money.
You realize that electrics are heavier than similar sized and shaped gas vehicles, right? So this would be an incentive to keep buying gas cars.
What he means isn’t that automakers have no interest in affordable products.
Weird, Nissan doesn’t have a problem selling Versas for $16k? Chevy doesn’t have a problem selling a Malibu for $25k? Honda doesn’t have a problem selling a Civic for $25k or an Accord for 28k?
And what happens to the customers who literally can’t afford the expensive models? There’s a lost sale for every one of them.
This is just fundamentally flawed logic.
In recent years especially, that’s a big part of why your new car choices have skewed so heavily toward bigger crossovers, SUVs and trucks.
They’ve skewed that way because of CAFE standards.
I think you’re right, but I also think it’s insane that we think of 25000 dollar vehicles as the budget models. An affordable car is something a middle-class income could afford out of pocket in my opinion. Who can spare 25k nowadays?
Everyone and their mother is comfortable sitting on a car loan and $25k is pretty reasonable for a middle class family these days.
What still blows my mind is how common it is to I see people rolling around in $80k trucks.
I’m not comfortable with that. 25,000 is $400 a month (5 years). But yeah trucks are ridiculous. People gotta be taking out 8-10 years to pay for those
In our stage of capitalism, these arent even exceptions. 16k for a Versa. Is probably the best deal I’ve seen in forever, because almost no one makes sub $20,000 cars now. The last New cars I saw for that were economy cars (Sonic/fiesta/fit etc)
Weird, Nissan doesn’t have a problem selling Versas for $16k? Chevy doesn’t have a problem selling a Malibu for $25k? Honda doesn’t have a problem selling a Civic for $25k or an Accord for 28k?
Malibu used to be sub $20,000 new. (2008) Civics were $13-15,000 in 2005 brand new. These prices are outrageous for the amount of car you get by comparison. $25000 for a civic? It’s small and goes vroom. For 3,000 more you have an Accord! Compared to an Accord Civics have no storage, small legroom, an engine that makes them zippy for sure, but it’s not as if the Accord is a slouch. At this stage mpg is comparable.
And what happens to the customers who literally can’t afford the expensive models? There’s a lost sale for every one of them.
If you’re not interested in playing the game of taking on massive debt Then that’s fine - in their eyes you can keep buying used cars. For this type of person, they’ve fought so hard to make every car so unfixable to the average person. Parts and service departments are free to make a killing if you can’t fix it yourself.
For those that insist on buying dates models you CAN fix - You can forever own hand me downs with ghosts under the hood, gremlins in the electrical lines and odometers with 6 digits. It’s just a numbers game where eventually you will buy one that shits out way sooner than you can afford before your mentality suggests “maybe reaching deep on a CC and getting something with warranties wouldn’t be so bad?”
Civics were $13-15,000 in 2005 brand new.
This might be hard to believe but 2005 was nearly 20 years ago…cars have improved in nearly every way possible, then add 20 years of inflation to that and it starts to sound like a good deal…
If you’re not interested in playing the game of taking on massive debt Then that’s fine - in their eyes you can keep buying used cars.
So they…don’t like profit? Because that also contradicts OP.
“Improved”?
If you actually think that’s true, then I have a subscription to your seat belt to sell you.
I’ll be sure and write that on your gravestone.
This might be hard to believe but 2005 was nearly 20 years ago…cars have improved in nearly every way possible, then add 20 years of inflation to that and it starts to sound like a good deal…
Using an online inflation calculator shows the 2005 price inflating to 21,400, and the 2015 price inflating to 24,900. It would seem the civic is matching inflation. So, I’m wrong on how inflation has impacted the value of most cars, but that still doesn’t solve the problem that New cars aren’t being released for under $20,000 (stateside) anymore - and subsequently how much debt people have to sink into to buy New. Inflation has run what should just be a basic ass car into $24,000+
But my turnaround question would be does the cost to manufacture this car truly not fall? Is the manufacture cost also meeting inflation the way we found the MSRP has? Has manufacturing one truly remained at 90% MSRP? (A quick Google says profits are usually only 10%). If so, why? I understand facelifts and upgrades over the years but if you’ve been making the same “name” car that shares parts with itself through the years from 2005 till 2025, how are some of those parts not dirt ass cheap - because car brands are intentionally not reusing the parts. A great example is the 2012 and 2014 Chevy Sonic rims are the same. 2013 and 2015 are the same too. Why aren’t they they same across 4 years? Also why is the 2012 one a bolt pattern 5x105 - a size and pattern never used again or previously? Because fuck you, consumer, we needed them to be scarce so the price stays at $300 per rim. (Personal experience I had in 2017). A civic, and any other long life car model could be cheaper, but they’re not because car makers insist on convoluted systems and “innovation for innovation sake” so a new car is always full of new R&D they need to pay for.
Also cars are covered in touchscreens now. Do you know why - touchscreens are just a TV with a digitizer like your phone. And we have been making those for 20 years so they ARE cheap as dirt. Touchscreens are so popular in the face of consumers wanting buttons because they’re so cheap to put in and make a UI for. In fact the UI doesn’t even have to change, it just needs to look new every few years and anyone with some computer knowledge will tell you how far changing a jpg image for a button goes to fooling people you did a lot of work.
So they…don’t like profit? Because that also contradicts OP.
No, they made cars nearly unfixable to most mechanic shops and you, the consumer with computerisation/combining parts (climate controls are built into the radio unit on mustangs) and own the market on tools to fix their brand. Most Dealerships state parts/maintenance make big bucks. If your car is new enough Chevy and Dealerman are making bank by selling you, for example, a radio head unit that specifically fits around that climate control system, for $500 and then $70/hr in labor.
Not just the consumer, they also get to rake shops across the coals because they make parts that need a unique tool to access and then charge the shop $500 for the tool to prevent them getting their value out of its use. No shop will get $500 of use out of a cube tool that resets the brake caliper of a Kia Sedan in 2006, 2007, and 2008. So shops didn’t buy it. Where does that bring you but back to Kia Dealerships. (Or attempting it with needle nose pliers)
that still doesn’t solve the problem that New cars aren’t being released for under $20,000
The number in OP was $25k
Inflation has run what should just be a basic ass car into $24,000+
Yes, inflation is a problem. That’s a different discussion.
Is the manufacture cost also meeting inflation the way we found the MSRP has?
Manufacturing costs go down but also there is an increase in technology, fuel efficiency, and especially safety.
if you’ve been making the same “name” car that shares parts with itself through the years from 2005 till 2025
No one is doing that. Just because it has the same name doesn’t mean it’s even remotely the same car as it was 20 years ago…
Also cars are covered in touchscreens now. Do you know why
Because backup cameras were mandated in 2016.
The number in OP was $25k
For electric cars yes. (As opposed to the civic question). The reason I would posit is a culmination of my points. Companies love to over engineer these systems to justify high R&D to allow prices (and margins) to go up.
Manufacturing costs go down but also there is an increase in technology, fuel efficiency, and especially safety.
Not something you or I could answer, but are these costs truly matching inflation? In this era I am hard pressed to believe profits are still only 10% that is listed online.
No one is doing that. Just because it has the same name doesn’t mean it’s even remotely the same car as it was 20 years ago…
Many parts do the exact same stuff they used to. A radio head unit nowadays is the same head unit 3 and 5 years ago in a new shell. Bluetooth, USB, Apple/Android carplay, am/fm. And now they’re hooked up to the touchscreens. Why change what already works in a new facelift year, except for no reason other than to intentionally prevent parts from becoming commonplace. The rims I mentioned. No one will notice when buying a car if those rims were reused those 4 years.
Because backup cameras were mandated in 2016.
A friend owns a 2019 Ford Fiesta that has a backup camera on the installed screen that’s 5 inches tall to 6 inches wide. It’s incredibly minimalist and I know most people do enjoy an infotainment system now. That doesn’t change my point here that brands embraced putting an iPad in your car, and won’t give you buttons back because the ever increasing size screens are incredibly cheap compared to the radio/climate/headlight buttons you see people bemoaning they want back. It also feeds back to the “you can’t fix it yourself” problem that car brands have manufactured for consumers.
For electric cars yes.
Doesn’t matter. The entire point of the article was that EVs can’t be made inexpensively because there’s not enough profit in inexpensive vehicles. I brought up the vehicles I did because it disproves that theory.
are these costs truly matching inflation?
Probably not. Still nothing to do with EVs.
Many parts do the exact same stuff they used to.
That doesn’t mean they’re the same part.
A radio head unit nowadays is the same head unit 3 and 5 years ago in a new shell
No.
Your prices are way off. The only car that can be bought brand new for less than $20k in the USA is the Mitsubishi Mirage, and from experience it sucks to drive. A Malibu and a Civic are both like $29k, but actually Chevy just quit making Malibu’s this year.
Your prices are way off.
Not sure what country you’re from but my prices are direct from the US OEM website, but maybe you can let them know they need to update them.
it sucks to drive
Most cheap cars do. You want cheap? That’s what you get. That has nothing to do with the author’s claims that the OEMs have no interest in selling them.
Wouldn’t CAFE standards push them to smaller more efficient cars, or am I misunderstanding what CAFE standards are?
As for affordable cars, I think it’s fairly easy for the auto industry to just raise prices while extending financing terms longer and longer and advertise $299/mo (with 180 mo financing, $6k down, at 8% interest excluding taxes and fees).
The car companies went huge, they made their standard vehicles so big and heavy they qualified for EPA standards meant for work trucks.
Just blatant fuck you to regulations and people’s health.
I think what they’re saying is that CAFE standards just encourage companies to make and market vehicles where those standards don’t apply, or at least are less strict, such as “light trucks”
Yes, exactly. CAFE carves out exceptions for bigger vehicles, so they just stopped making small ones altogether.
Ohhh that makes sense.
it doesn’t cost that much more to make a bigger, more expensive than a smaller and cheaper one. But they can charge you a lot more for the former, which makes this a game of profit margins and not just profits.
This is also why cars are loaded with electronics now. They’re high margin add-ons to inflate the value of the car with little cost.
Also they break and are almost impossible to fix, so basically throw the car out after the lease is done and get a new one.
they’re not really interested in making affordable electric vehicles
Huh, that’s strange. I’m not really interested in a $25,000+ EV. Turns out that a $1,200 ebike is faster than my car (due to traffic) and costs orders of magnitude less to maintain and charge. I’ve basically just stopped driving.
Perhaps my interest will be piqued when they can develop a sub $25k EV, without half the “smart” features like subscriptions for Bluetooth audio and heated seats. Until then, I’ll use my old car like…a dozen times a year.
I commute 1.5 hours each way. I wish I could ebike it.
Yeah, it really fucking sucks when there’s only one form of transportation and virtually no alternatives. I’ve lived in places like that, and it’s always infuriating when your car won’t start and you are already running late for work. And the nearest bus is really slow and on a half-hour basis. My old city didn’t even have bus stops for awhile, you just had to flag the bus down and hope they saw you.
I wouldnt complain if they’re was something like 1. A motorcycle highway, or 2. A functional high speed railway network.
Yeah. I just want a basic electric pickup.
Damn, I guess the nissan leaf needs a recall, it’s top cheap. How unfortunate that car manufacturers ignore a sizable chunk of their market
Dacia Spring. Small, light, 300km city range. 19000€ from dealer. I bought mine used with 2000km driven and two doors needed painting for 6000€. Half year old. I drive about 100km every day in the city so far so good.
Yeah. The “affordable” ones are just there too start the sale.
They are already have the lot dressing manufacturing lines built, and won’t build EV loss leaders until they are needed to bring in customers.
They’re not even loss leaders though.
