Yahoo Autos If Mercedes' EVs Take Off, It'll Have its Formula 1 Team to Thank
Mercedes-Benz says its future EVs will rely on tech that won it so many Formula 1 titles, the good news keeps on rolling for Hyundai and Uber and Toyota and Nissan have soul searching to do in China. All that and more in this edition of The Morning Shift for Tuesday, May 2, 2023.
1st Gear: Racetrack to Road
Automakers love to tell the public that the clever, cutting-edge engineering behind the cars they campaign in motorsport inform the vehicles regular folk like us can eventually buy. It’s an easy marketing story, but there’s a little more truth to it in Mercedes’ case, because the German automaker has been active in Formula 1 for more than a decade, and F1 has been using electric motors for most of that span. Also, Merc has won many championships. Here’s how the company’s learnings from competition helped it squeeze the maximum efficiency out of the EQXX’s energy system, courtesy Reuters:
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[Mercedes AMG High Performance Powertrains (HPP)] director Adam Allsopp said he took the call from Mercedes headquarters in Stuttgart that kickstarted the EQXX project standing in a former cowshed while on holiday on the Isle of Wight in August 2020. It came with a clear, tough challenge - build an EV capable of driving 1,000 km on a single charge.
F1 fuel limits imposed in 2014 forced HPP to develop engines and cars that squeeze the most out of every drop and to “chase every single watt of loss” from two electric motors, Allsopp said. [...]
Applying that racing mindset, F1 engineers in Brixworth and nearby Brackley worked with a team in Stuttgart to produce the EQXX - using a flexible approach that allowed the team to move forward with development before the EV’s batteries were ready and then adapt plans when they were.
The EQXX featured a battery pack half the size of Mercedes’ flagship EQS SUV, compact electronics hardware and new operating system. Coupled with sleek aerodynamics, that allowed it to drive more than 1,200 km from Stuttgart to Silverstone in England on a single charge, spending 8.3 kilowatt hours (kWh) of energy per 100 km.
Now, I don’t mean to dismiss Mercedes’ achievement here, but the EQXX is but still a concept, and the hard work the F1 powertrain crew put into it hasn’t made its way to any production Silver Arrows EVs yet. That could change as soon as next year, based on a statement CEO Ola Källenius made at a roundtable, quoted by The Drive in 2022. Chief Technology Officer Markus Schaefer doubled down on that timeline to Reuters, saying that the company is in the process of converting its global plants to the Mercedes Modular Architecture platform, which will incorporate aspects of the EQXX’s next-generation tech:
To maintain speed for bringing elements of the EQXX to mass production in 2024 on its new compact Mercedes Modular Architecture (MMA) vehicle platform, the German carmaker has developed a digital model of its plant in Rastatt - the same car will also be built in Hungary and China - to “simulate the assembly process,” and thus accelerate the physical changeover of the plant to build the new EVs, CTO Schaefer said.
Traditionally, carmakers have conducted “mid-life” upgrades on vehicle models after three or four years, but Schaefer said “updates to EVs will be way more frequent.”
Remember when Volkswagen made that plug-in turbodiesel two-seater than went 240 miles on a gallon of fuel and also cost approximately a billion dollars? It’d be really nice if these ultra-efficient testbeds were actually normal, reasonably priced cars people could buy.
2nd Gear: The Telluride Can’t Be Stopped
Automakers’ April U.S. sales results are starting to roll in, and Hyundai, Kia and even Genesis just had another solid one. Did you expect any different? By way of Automotive News:
Volume rose 15 percent at Hyundai and 16 percent at Kia last month, the companies said Tuesday.
Hyundai’s retail sales rose 5 percent to 64,895 in April, with fleet volume of 5,917, or 8 percent of total deliveries in the month.
Randy Parker, CEO of Hyundai Motor America, cited “high demand for Hyundai product” and “a diverse lineup” of crossovers, trucks and electrified vehicles for the latest results.
Hyundai said it had 49,045 cars and light trucks in U.S. stock at the end of April, down slightly from 53,119 at the close of March but up sharply from 15,809 at the end of April 2022.
Sales of Kia’s electrified vehicles rose 74 percent to 11,798 last month, while utility vehicles accounted for 71 percent of April deliveries.
Kia, with one of the industry’s lowest days supply of new vehicle, as well as a hot streak with retail buyers, continues to prioritize production for dealers while keeping fleet volumes “very modest.”
Genesis also saw sales rise by double digits with April volume of 5,857, up 16 percent and a record for the month, behind higher deliveries of the GV70 and GV80, as well as the new GV60 EV. Genesis sales have now advanced six consecutive months.
This marks the ninth-consecutive month of retail growth for Hyundai and Kia. In other news, the average incentive for a new car was 59 percent higher last month compared to the same period a year earlier, per data Auto News cited from TrueCar. Only Toyota and Honda have been stingier with the discounts over that span.
3rd Gear: A Rising Uber Lifts All Ride Sharing
Uber outperformed its first quarter revenue estimates by $100 million, driving up shares 8 percent Tuesday morning and even lifting the stock prices of its competitors, Lyft and DoorDash. From Reuters:
Uber is benefiting from its dominant position in key global markets as travel rebounds from a pandemic-induced lull. A jump in the number of people looking to gain additional income is also helping platforms such as Uber squeeze out higher profit by offering lower incentives to gig workers, analysts have said.
“Our clear lead on driver preference has allowed us to better serve this growing demand: 5.7 million drivers and couriers earned $13.7 billion (including tips) on Uber during the quarter, both all-time highs,” CEO Dara Khosrowshahi said.
After a tepid performance in the last two years, “the rideshare category in the United States and Canada is now growing faster in 2023,” he said.
Uber expects adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) - one of its closely watched financial metrics - between $800 million and $850 million for the June quarter. That was higher than analysts’ projection of $749.1 million, according to Refinitiv.
The company also forecast gross bookings, the total dollar value from its services, of between $33 billion and $34 billion, compared with the expectations of $33 billion.
The ride-hailing portion of the business grew by 72 percent alone, and Uber Eats rose by 23 percent in kind, helping the company to a record first-quarter profit. It’s a very different story from the one Uber was telling nearly a year ago, when it raked in $8.1 billion and yet still lost money.
