Subaru's Next EVs Are Probably Going to Need a Few Years

Promotional image of a Subaru Solterra driving on a dirt road.
Promotional image of a Subaru Solterra driving on a dirt road.

Subaru is talking about EVs again, Volkswagen’s 2022 was one of triumph and failure, while Uber appears to believe it can never fail again. All that and more in The Morning Shift for Wednesday, February 8, 2023.

1st Gear: The Solterra’s Only the Start

Subaru announced a 9 percent reduction in its annual production forecast this morning during a quarterly earnings call, citing the ongoing chip shortage. That’ll leave Subaru with about 880,000 units by the end of the current fiscal year, which concludes March 31.

Read more

What’s more interesting are the automaker’s plans over the medium term. Subaru hopes to surpass a million cars next year, and by 2025 the brand expects to have “several models in its EV lineup,” joining the existing Solterra, developed with its partner and minority shareholder Toyota. That won’t be the end of the two companies’ collaboration in the arena of electrification. Courtesy Automotive News:

“Our main electrification strategy centers on strong hybrids and electric vehicles and introducing such models in the U.S. by 2025,” Tomoaki Emori, senior vice president of the corporate planning division, said at the company’s Wednesday quarterly earnings announcement.

“When we look at the U.S. market situation, we will need to offer several models in our EV lineup,” he said. “We have shifted our weight toward that in our development.”

Emori did not offer details about the upcoming EVs, but they would be in addition to the only full-electric vehicle currently in the lineup, the Solterra crossover co-developed with Toyota. Subaru said last May that it wants to derive 40 percent of its global sales from battery electrics and hybrids by 2030 and apply electrification to all models in the early 2030s.

Ramping up battery-electric offerings is key to future business in the U.S., and the U.S. accounts for a whopping 75 percent of the company’s global sales. That’s a figure I frankly wasn’t aware of, but we indeed love our Subarus here, so it isn’t all that surprising. The automaker intends to reveal its EV roadmap by the summer. If it’s appeared slow-moving in going away from internal combustion, that’s probably because Toyota’s been, too.

Subaru will start in-house production of EVs on a mixed production line with internal combustion vehicles in the mid-2020s. And from 2027, it will churn out EVs from a dedicated line being planned for its Japanese plant in Gunma prefecture.

Subaru’s upcoming hybrids will use Toyota’s hybrid system and be made at Subaru’s Gunma complex. The site currently manufactures the Forester, Crosstrek, WRX, BRZ, Legacy, Outback and Impreza, giving an idea of what nameplates might be in line for electrification.

This isn’t an earth-shattering take or anything, but if Subaru really wants to make EVs as much of a priority as it says, it needs to bring something to the table that’s more compelling than the Solterra, a car whose most notable trait so far has been losing its wheels. Maybe Toyota is kind of holding Subaru’s EV plans hostage, but then of course if not for Toyota, Subaru would have zero EVs. Beyond zero, you might even say.

2nd Gear: Good News, Bad News for VW

Volkswagen Group met its sales target for 2022 and yet significantly underperformed its net cash flow expectations. Again, the supply chain is shouldering the blame. That’s believable, considering how the automaker said it had 150,000 unfinished vehicles in its inventory back in October. From Barron’s:

Volkswagen preannounced 2022 results on Tuesday evening. Full results are coming on Mar. 14. The company reported full-year operating profit of 22.5 billion euros ($24.2 billion) from sales of 279 billion euros. Wall Street was looking for about 22.8 billion and 278 billion respectively.

Automotive free cash flow came in at 5 billion euros. Volkswagen was targeting about 8.6 billion euros.

“The miss was driven by supply chain and logistics issues in Q4 weighing on working capital,” wrote Bernstein analyst Daniel Roeska in a Tuesday report. “The company expects the effect to largely unwind in 2023.”

Investors appear to believe the company. The stock is stable after the early results release. Volkswagen shares are down about 0.9% in overseas trading.

Still, none of this was really a surprise to Volkswagen or investors, which is more than some of the company’s rivals can say. The group ended 2022 having delivered 8.3 million vehicles worldwide — its lowest in a decade — compared to 8.9 million in 2021.

3rd Gear: Uber Believes the Worst Has Passed

Having shattered revenue estimates and set new records in trips on the way to its “strongest quarter ever” — in the words of its CEO — Uber seems confident that the pandemic doldrums are firmly in the rearview mirror. From The New York Times:

Uber reported $8.6 billion in revenue in the last three months of 2022, a 49 percent increase from the same period a year ago, when the Omicron variant of the coronavirus dampened travel. The company made $30.7 billion in gross bookings — the amount of money paid by customers — a 19 percent year-over-year jump.

The company said it had tallied two billion trips in a quarter for the first time, up from 1.7 billion a year ago, and it saw an 11 percent increase in the number of customers who use Uber each month, to 131 million.

The results slightly exceeded the expectations of Wall Street analysts. Uber’s stock rose 7 percent in premarket trading.

To say that Uber’s story is a rare one in the current economy would be an understatement, as the rest of Silicon Valley has announced sweeping layoffs. At $36.82 a share, Uber is now trading higher than it has in nearly a year, but still a ways off of its February 2021 height, when the company surpassed $60.

4th Gear: Hertz Should’ve Had More Teslas by Now

Hertz is pretty upbeat these days. The company posted slightly improved revenue in the fourth quarter and forecasts travel demand to keep the ball rolling through 2023. However, it appears Teslas account for a lower percentage of Hertz’s overall fleet than had been expected, after the rental car firm announced a plan to order 100,000 Model 3s before the end of last year. From Reuters:

Hertz Global Holdings Inc’s rental fleet has less than half the number of Tesla cars it planned to order in 2022, its regulatory filing showed on Tuesday.

Hertz’s fleet in the Americas peaked at 428,700 vehicles for the year ended Dec. 31, 2022, of which 11% were Tesla cars, the filing showed. The company had an additional 1,187 Teslas in its international fleet.

That implies the company’s fleet has 48,344 Tesla EVs, or less than half of the 100,000 electric cars the company decided to order from the automaker by the end of 2022.

If you recall, that deal was so big for Hertz and Tesla back when it was announced in October 2021 that it briefly lifted Tesla to a $1 trillion valuation. About 14 months later, Hertz claims slightly less than half the number of EVs it said it would — and that’s just if we’re going by the Model 3s it planned to buy, saying nothing of the Model Ys added to the tab.

5th Gear: India’s Electric Scooter Startup Gets Into Cars

Ola Electric, a scooter company founded in 2017 spun off from a rideshare company founded in 2010, wants to add four-wheeled vehicles to its repertoire. This would seem like a big leap for an entity that only started making things six years ago, but its chief financial officer says that the process of building an electric car isn’t markedly different from building an electric scooter. From Bloomberg:

The manufacturer and ride-hailing company is focused on advanced stages of design and benefiting from the sharing of some technology deployed in its two-wheeler products, [Chief Financial Officer G.R. Arun] Kumar said in an interview in Bengaluru on Wednesday.

“Software, safety systems, electronics, cells, the drive train — a lot of it is common,” Kumar said on the sidelines of the India Energy Week forum. “We think we’re 30%-40% there.”

Last year, Ola’s founder Bhavish Aggarwal said the company aimed to price its first car at less than $50,000, manufacturing components such as lithium-ion cells and batteries in-house to lower costs. Ola aims to compete with the likes of Tesla Inc., Hyundai Motor Co. and local rivals such as Tata Group in India’s electric-vehicle market, which consultancy RBSA Advisors forecasts to be worth more than $150 billion by 2030.

Watching companies that have never built cars before compare it to manufacturing anything else — more often than not less complex widgets — has proven to be a renewable source of entertainment in this era of mainstream EV adoption. Maybe Ola will knock it out of the park, maybe not, but, either way, it’ll be fun to watch what happens next.

Reverse: Jack Nicholson Invents Road Rage

On this day in 1994, 29 years ago, something happened that I, personally, did not expect to read about on

Years later, he would play a therapist counseling Adam Sandler in the black comedy Anger Management (2003), but on February 8, 1994, it was the Oscar-winning actor Jack Nicholson who let his anger get out of control.

In a criminal lawsuit filed against the actor, Robert Blank stated that Nicholson, then 56, approached Blank’s Mercedes-Benz while he was stopped at a red light in North Hollywood. After accusing the other man of cutting him off in traffic, Nicholson used a golf club to bash the roof and windshield of Blank’s car. A witness confirmed Blank’s account of the incident, and misdemeanor charges of assault and vandalism were filed against Nicholson. Charges were dropped after Nicholson apologized to Blank and the two reached an undisclosed settlement, which included a reported $500,000 check from Nicholson.

Neutral: The Prius’ Secret History

The news that Toyota engineers want to do up a GR version of the dashing new Prius might come as a surprise to those of us that spent our younger years bashing on the car for no good reason, but there’s a precedent for this. Meet the GT300 Prius, of Japan’s Super GT racing series.

More from Jalopnik

Sign up for Jalopnik's Newsletter. For the latest news, Facebook, Twitter and Instagram.

Click here to read the full article.