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Automakers face reality of EVs' cost — to jobs, and their bottom line

Related: We obsessively covered the Frankfurt Motor Show — here's our complete coverage FRANKFURT, Germany — European car bosses gathering for the Frankfurt auto show are beginning to address the realities of mass vehicle electrification, and its consequences for jobs and profit, their minds focused by government pledges to outlaw the combustion engine. As the latest such announcement by China added momentum to a push for zero-emissions motoring, Daimler, Volkswagen and PSA Group gave details about their electric programs that could give policymakers some pause. Planned electric Mercedes models will initially be just half as profitable as conventional alternatives, Daimler warned — forcing the group to find savings by outsourcing more component manufacturing, which may in turn threaten German jobs. "In-house production is almost irrelevant to the consumer," Daimler boss Dieter Zetsche told reporters on the eve of the Frankfurt Motor Show, in the midst of a German election campaign in which automotive jobs have loomed large. The company set a target of saving 4 billion euros ($4.8 billion) by 2025 to help fund the cost of its electric cars. "Daimler is the first company to state explicitly how much electric vehicles are going to hurt margins," said Bernstein analyst Max Warburton. "It was brave to go first — but of course it won't be the last." Volkswagen, for its part, said it was seeking new global supplier contracts to source 50 billion euros ($60 billion) of electric car content including batteries, which are not yet manufactured competitively in Europe. "A company like Volkswagen must lead, not follow," Chief Executive Matthias Mueller told reporters. VW diesel emissions-cheating exposed by U.S. regulators in 2015 triggered global public outrage, dozens more investigations into test-rigging by the wider industry and a push by some lawmakers to ban diesel and eventually all engines. TIGHTENING NOOSE Tesla shares jumped nearly 6 percent on Monday after a Chinese minister said it was a question of when, not if, Beijing bans fossil-fuel cars, tightening the noose around the combustion engine. France and Britain have promised its outright abolition by 2040. But PSA, the maker of Peugeots and Citroens, said it was concerned about the risks if consumers were left behind in the rush, and a new generation of battery cars does not sell.

Recharge Wrap-up: Arcimoto SRK video, BAIC EV at CES

Kelley Blue Book took a spin in the Arcimoto SRK three-wheeled EV at CES in Las Vegas. In the video above, KBB Managing Editor Micah Muzio gets behind the handlebars for a spin around an empty parking lot. He notes a gradual throttle tip-in, though from the video, it appears the trike has a bit of pep. While the hydraulic brake pedal requires a bit of extra effort, the regenerative brake lever located on the right handlebar is effective and easy to use. The steering is a little heavy, but manageable, at low speeds. He calls it "kind of a fun little conveyance," adding, "Maybe this is the future." See the full review in the video above. CARB Chairman Mary Nichols spoke with German television about Volkswagen's emissions scandal. In a photo she posted on Twitter, Nichols can be seen in front of cameras with CARB's test bay in the background. In the bay is a Volkswagen Jetta TDI. She says in her tweet, "Discussing VW cheating case w/German TV in front of ARB lab test bay & '07 diesel Jetta. Time to move on to #EVs!" Late last year, a group of environmentalists and Silicon Valley leaders – Elon Musk included – sent Nichols an open letter suggesting CARB help urge Volkswagen to give up on diesels and focus on electric vehicles. See Nichols's post on Twitter. South Korea's most popular EV is the Renault Samsung Motors (RSM) SM3 ZE (also known as the Renault Fluence ZE). The all-electric vehicle has sold 1,767 units since its arrival in Korea since November 2013, with 2015 sales reaching 1,043 units. This makes one in three EVs in Korea a RSM SM3 ZE. The car has been selected as Korea's official government vehicle, and RSM has supplied over 100 EV taxis, 60 of which are in Seoul. Read more in the press release from Renault. BAIC EV announced it has established an R&D center in Detroit at CES. It will work with its other centers in Silicon Valley and Aachen, Germany in order to develop automotive technology and evaluate global demand. The EV branch of the Chinese automaker also debuted its i-Link information system, which uses 4G to connect car telematics to the cloud. The i-Link system also provides wireless phone charging, remote inquiry services and connects sensing technologies to the internet. Read more in the press release below.

VW says it has sold over 100,000 TDI diesels in America this year

Volkswagen Group of America has lit oil-burning fireworks to celebrate the sales of more than 100,000 TDI Clean Diesel vehicles in the US between its VW and Audi brands this year. According to VW, that means it is responsible for more than 75 percent of diesel-engined cars and SUVs sold here - perhaps not surprising when the two brands offer a total of 12 diesel models.
What might be surprising is that the number of diesels isn't far off the estimated sales of 90,000 battery electric vehicles and PHEVs, with 15,000 of those accounted for by the Tesla Model S, another 12,000 or so being the Toyota Prius PHEV.
VW's keen to play up the ease of making diesel part of your life, stressing that it doesn't need any change to the refueling infrastructure and that "this is a technology delivering real answers to society's concerns about fuel consumption and greenhouse gas emissions without compromises."