The future of EVs

[billvon 2,406]

While we're on the topic:

The two big changes that will happen in the near future are:

1) A steady reduction in price that will result in EVs being cheaper than gas cars.  As companies like Tesla switch to LFP batteries (not requiring cobalt or nickel) batteries will become cheaper and easier to make.  In addition, as local sources of lithium come on line (like the Salton Sea mine) the cost of lithium will drop.  These two factors will cause a significant decline in battery cost, currently the #1 cost of EVs.

In addition, a growing used EV market, along with service centers becoming more familiar with EVs, will make used EVs both cheaper and easier to fix.

2) A buildout of solar will make solar power systems more ubiquitous.  In California, lower income families will get solar not by having it installed, but by buying older homes that already have solar.  This will make electricity for those families cheaper, and thus significantly lower the cost of ownership of EVs.

The combination of these two factors will cause an acceleration in EV sales starting in 2-3 years, and it will continue for another 2-5 years.

The next big effect will kick in when EVs approach 25% of the vehicles on US roads.  At that point, the cost of gas will plummet; demand will drop rapidly and supply will remain approximately the same.  This will tend to slow down further sales increases of EVs.

The next big issue will be charging.  As EVs become more common, on-road charging will become more in demand.  Tesla stock will skyrocket again as investors realize that 1) Tesla owns the largest charging network in the US, 2) all EVs are converting to the Tesla charging standard (NACS) and 3) Tesla can basically charge whatever they want for charging other manufacturer's cars.  Tesla will turn this money-printing machine into more chargers.  The load placed on the grid will be ameliorated by new laws that require solar/storage at charging stations.

In about 3 years the load on the grid will become significant, and this will drive changes to how people charge.  Right now 99% of EV owners charge at midnight because that's when the grid is least loaded (and power is cheapest for people on TOU metering.)  Once tens of millions of EVs do this, then nighttime will no longer be the easy answer to when to charge.  Instead, charging from 9am to noon (greatest solar generation, lowest load) will become more common.  Businesses will put in outlets as employee perks, because EVs can plug in for almost no cost to them, and employees will see that as valuable.

As EVs become more connected, power companies will use the variable load they represent to control the load on the grid.  Chargers will have discount prices for people willing to go on DR (demand response) where charging rates are reduced  - or even reversed - during times of high grid load.  This will tend to level out the load seen by the generators on the grid and reduce the peaks that currently threaten to overwhelm grids across the US.

As more and more car companies make EVs, cheap, crappy EVs will start to appear.  They will get the same complaints as cheap cars have gotten since the 1940's.

Conservatives will see this as a threat, as they see any progressive change.  As EVs grow more and more rapidly we will see increasing vandalism towards EVs and chargers.  This will range from ICEing chargers, to the usual keying and spraypainting, to destroying chargers and threatening drivers on the road.  We'll see "EVs NOT WELCOME" in parking lots in deep red counties.  They will point to job losses at refineries, gas stations and drilling rigs to "prove" that EVs are destroying America.

But as today's conservative have kids, and those kids grow up with EVs, they will no longer seem new and progressive to them.  And within 30-40 years EVs will simply be what people drive, no different than fuel injected cars today.

At that point we will still be selling gas cars, but in similar quantities that we sell diesels in the US today.  They will become niche cars.  Gas prices will continue to decline while refinery capacity far exceeds demand, but this will level out and reverse as oil becomes more scarce and as refinery capacity adjusts to the new demand.  Oil demand will still be significant, with fuels for aviation and marine, long distance trucking and spaceflight remaining, and of course there will still be a huge demand for lubricants, plastics, paint and fabrics.

[olofscience 422]

6 hours ago, billvon said:

Tesla stock will skyrocket again

As far as I know Tesla's stock price has a much higher P/E ratio than normal because investors have priced in 50% growth for several years. They're more like a tech stock right now, and I don't think that share price is sustainable, much less skyrocket even further.

6 hours ago, billvon said:

all EVs are converting to the Tesla charging standard (NACS)

Well it's a standard - I don't think Tesla will earn any money (directly) as they offered their spec up for standardization.

6 hours ago, billvon said:

Tesla can basically charge whatever they want for charging other manufacturer's cars

I don't think they have any "moat" here except their app - it's likely competitors will aggressively price under them and this will keep prices under control. Electricity is fairly cheap compared to gasoline, after all.

 

The atrocious reliability of chargers so far is inexcusable given that they have no moving parts. This is mostly due to software, and at some point a startup will make one easy and reliable and bring the fight to Tesla.

[gowlerk 1,916]

4 hours ago, olofscience said:

The atrocious reliability of chargers so far is inexcusable given that they have no moving parts. This is mostly due to software, and at some point a startup will make one easy and reliable and bring the fight to Tesla.

They need Apple to get involved.

[billvon 2,406]

6 hours ago, olofscience said:

As far as I know Tesla's stock price has a much higher P/E ratio than normal because investors have priced in 50% growth for several years. They're more like a tech stock right now, and I don't think that share price is sustainable, much less skyrocket even further.

Well, if their model changes and most of their income starts coming from a new source (one that is already partly amortized) I could see that changing.

Quote

It's a standard - I don't think Tesla will earn any money (directly) as they offered their spec up for standardization.

I'm not talking about licensing the standard.  I'm talking about people directly using one of the 2000 or so Tesla charging locations (about 45,000 total fast chargers) and Tesla billing people for that.  And they are still building.  This is going to become a cash cow as more companies start using Tesla charging stations.

Quote

The atrocious reliability of chargers so far is inexcusable given that they have no moving parts. This is mostly due to software, and at some point a startup will make one easy and reliable and bring the fight to Tesla.

Hmm.  Most of the charger failures I've seen (Level 2, Chademo and NACS) have been hardware.  Level 2 (J1772) failures are usually the latch-detect switch.  Chademo is usually either a connector failure (broken pin) or an insulation test failure.  Tesla failures are a little more opaque because there's no user interface.

[johnhking1 73]

There are federal and state highway taxes on gasoline and diesel.  The electric vehicles are using the highways but not currently paying the tax.  At some point in the future, the federal and state government will implement some sort of tax or fee for electric vehicles.

[billvon 2,406]

10 minutes ago, johnhking1 said:

There are federal and state highway taxes on gasoline and diesel.  The electric vehicles are using the highways but not currently paying the tax.  At some point in the future, the federal and state government will implement some sort of tax or fee for electric vehicles.

Yep.  Most likely, they will raise registration fees for both sorts of vehicles.

[olofscience 422]

48 minutes ago, johnhking1 said:

There are federal and state highway taxes on gasoline and diesel.  The electric vehicles are using the highways but not currently paying the tax.  At some point in the future, the federal and state government will implement some sort of tax or fee for electric vehicles.

This is quite a popular fallacy here in the UK too. The money collected from gasoline and diesel is nowhere near enough for the construction and maintenance costs of the highways, they're mostly funded by general taxation. So even people who don't drive pay for the highways.

[gowlerk 1,916]

2 hours ago, billvon said:

Yep.  Most likely, they will raise registration fees for both sorts of vehicles.

A use tax using information from transponders is likely easy to implement in this kind of vehicle.

[JerryBaumchen 1,050]

2 hours ago, olofscience said:

This is quite a popular fallacy here in the UK too. The money collected from gasoline and diesel is nowhere near enough for the construction and maintenance costs of the highways, they're mostly funded by general taxation. So even people who don't drive pay for the highways.

Hi olof,

I am a proponent of getting rid of all taxes/fees except income tax.  IMO that represents the true ability to pay.

Jerry Baumchen

[SethInMI 145]

3 hours ago, johnhking1 said:

At some point in the future, the federal and state government will implement some sort of tax or fee for electric vehicles.

In most states, EVs already get charged additional registration fees. I pay an extra $150 a year, which is about the amount of sales tax the state would get on $2500 worth of gas sales.

[Stumpy 256]

2 hours ago, JerryBaumchen said:

I am a proponent of getting rid of all taxes/fees except income tax.  IMO that represents the true ability to pay.

If only it were that simple.

[ryoder 1,390]

2 hours ago, JerryBaumchen said:

Hi olof,

I am a proponent of getting rid of all taxes/fees except income tax.  IMO that represents the true ability to pay.

Jerry Baumchen

That taxes the legal income, and minimizes the administrative costs.

But sales tax also gets those with illegal income.

e.g. the drug kingpin avoids income tax, but he pays a sales tax on his Lamborghini, his Gulfstream, and that yacht.

[SkyDekker 1,130]

10 minutes ago, ryoder said:

That taxes the legal income, and minimizes the administrative costs.

But sales tax also gets those with illegal income.

e.g. the drug kingpin avoids income tax, but he pays a sales tax on his Lamborghini, his Gulfstream, and that yacht.

no he doesn't, just steals it in Mexico and drives it across the border. 

[wolfriverjoe 1,346]

8 minutes ago, SkyDekker said:

no he doesn't, just steals it in Mexico and drives it across the border. 

Then he pays the import duties.

Contrary to what the Alt-Right wants to believe, the border is ANYTHING BUT 'open'.

[gowlerk 1,916]

1 hour ago, wolfriverjoe said:

Then he pays the import duties.

Contrary to what the Alt-Right wants to believe, the border is ANYTHING BUT 'open'.

Earned income is easy to tax. They set it up that way so the ordinary employee pays the bulk of it. Sales taxes are the next lucrative. Capital gains and wealth are barely touched. 

[Stumpy 256]

Just now, gowlerk said:

Capital gains and wealth are barely touched

This.

I do OK - I'm up there in terms of salary. There are MUCH much richer people than me who pay much less income tax.

[kallend 1,635]

12 hours ago, JerryBaumchen said:

Hi olof,

I am a proponent of getting rid of all taxes/fees except income tax.  IMO that represents the true ability to pay.

Jerry Baumchen

Disagree.  Sales tax even gets trust-funders with inherited wealth and crooks with illegal income.  There are too many loopholes in income tax.

Who remembers that Mitt Romney made nearly $22 Million in 2010, but paid less than 14 percent in taxes, a smaller % than his secretary.

[Phil1111 913]

10 hours ago, gowlerk said:

Earned income is easy to tax. They set it up that way so the ordinary employee pays the bulk of it. Sales taxes are the next lucrative. Capital gains and wealth are barely touched. 

Agree

2 hours ago, kallend said:

Disagree.  Sales tax even gets trust-funders with inherited wealth and crooks with illegal income.  There are too many loopholes in income tax.

Who remembers that Mitt Romney made nearly $22 Million in 2010, but paid less than 14 percent in taxes, a smaller % than his secretary.

Agree and it leads to:

Republicans have been very successful in selling their "trickle down" message since the 1950's.

[JoeWeber 2,316]

12 hours ago, gowlerk said:

Capital gains and wealth are barely touched.

Not so with respect to capital gains. Those happen when you sell wealth and you get taxed based on how long you held the asset.

[gowlerk 1,916]

4 minutes ago, JoeWeber said:

Not so with respect to capital gains. Those happen when you sell wealth and you get taxed based on how long you held the asset.

At a small fraction of the rate for income earned by labour.

[JoeWeber 2,316]

Just now, gowlerk said:

At a small fraction of the rate for income earned by labour.

In the US it's at 15% long term Federal and whatever the state adds on. In Oregon that's 10%. Short term, less than a year is at 25% or a total rate of 35%. Try to remember that your labor income is a consequence of someone risking capital. 

[gowlerk 1,916]

Just now, JoeWeber said:

In the US it's at 15% long term Federal and whatever the state adds on. In Oregon that's 10%. Short term, less than a year is at 25% or a total rate of 35%. Try to remember that your labor income is a consequence of someone risking capital. 

Yes, I'm aware of that. As anyone with any savings or money in a pension fund knows we are all in the game of risking capital. Still, it feels wrong that those with trust funds inherited pay a lower rate than as Warren Buffet claims, his secretary does. This issue is not simple but there is definitely an advantage given to those powerful enough to own politicians. 

[JoeWeber 2,316]

13 minutes ago, gowlerk said:

As anyone with any savings or money in a pension fund knows we are all in the game of risking capital.

Any you can vary the risk depending how you place it. Also, like Warren Buffet you pay no gains until you sell. Worrying about capital gains rates as an example of economic disparity is misplaced concern, I think. Better to wonder why huge holdings in stocks, real estate etc. with massive unrealized gains in excess of, say, one billion USD, aren't taxed. 

[ryoder 1,390]

4 minutes ago, JoeWeber said:

Any you can vary the risk depending how you place it. Also, like Warren Buffet you pay no gains until you sell. Worrying about capital gains rates as an example of economic disparity is misplaced concern, I think. Better to wonder why huge holdings in stocks, real estate etc. with massive unrealized gains in excess of, say, one billion USD, aren't taxed. 

Are you aware of the tactic of borrowing money while using appreciated stock as collateral, in order to avoid taxes?

https://www.cnn.com/2021/11/09/business/elon-musk-wealth-tesla-stock/index.html

[JoeWeber 2,316]

1 minute ago, ryoder said:

Are you aware of the tactic of borrowing money while using appreciated stock as collateral, in order to avoid taxes?

https://www.cnn.com/2021/11/09/business/elon-musk-wealth-tesla-stock/index.html

The scams are many which is why I think taxing appreciated capital above a certain value makes the most sense. Maybe 3% above a Billion, 5% above 10 Billion, and 15% above 15 billion. If the capital is actually working through the economy you can pay easily. If you get taxed down to just a Billion Dollars from 100 Billion you'll still have plenty for a pity party.