Prius Personal Log  #524

August 2, 2011  -  August 12, 2011

Last Updated: Tues. 8/16/2011

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Rollout Approach.  This first year of plug-in vehicles being offered has been an odd one so far.  We've got the EV misconceptions hampering Leaf and all the hype of EREV deflating Volt.  Of course, expectations really weren't that high for the first year anyway.  But determining consumer reaction is extremely difficult and misjudging isn't good for business.  Rollout approach for the upcoming PHV model of Prius will be to initially limit availability to the strongest markets and the strongest supporters... with the hope that those particular consumers help to promote by sharing of personal experiences... rather than just crunch numbers like we are seeing now from others, since they have no basis of comparison available.  After all, Prius is the only plug-in with a hybrid counterpart.  That means expectations could easily be based on assumptions.  Toyota would prefer real-world data being passed by word-of-mouth instead.  It's an approach proven effective.  Owners endorsements are a powerful source of promotion.


Invisible Technology.  Two neighbors jumped in my Prius yesterday evening.  They hadn't ever been in a Prius before, but had seen mine countless times sitting there in the driveway.  The spontaneous carpool it would save them the trouble of driving to the same meeting.  So, they took me up on the offer.  Neither had any idea how it worked, nor were they interested in details.  It simply worked.  The 50 MPG average displayed on the screen was good enough for them.  I didn't even bother to point out our cruise along the suburb road at 45 mph was without the engine.  That electric-only reference wasn't necessary.  It was the outcome they focused on. I wonder if that will be the situation with the plug-in next year.  Can I simplify my endorsement to just pointing out how I plug in every night and the result is around 80 MPG for my typical commute?  Will they ask about electricity consumption and understand an answer provided in kWh quantity?  The point is to make the technology invisible... taken for granted... because it simply works.  After all, very few consumers actually understand how an automatic transmission operates.


Elegant Alternative.  I found this particular review summary enthralling: "Despite a few weaknesses and a substantial price tag, the Volt’s extended-range electric vehicle technology would appear to be the most elegant alternative yet to the conventional automobile."  What does that actually mean for mainstream consumers?  Volt clearly isn't targeted at middle-market.  The price & power priorities resemble a niche, not the next standard... hence being an alternative.  It's really unfortunate so little emphasis was placed on making a more flexible platform.  Heavy dependence on a battery-pack due to having such an inefficient engine makes offering an affordable model unrealistic.  The light-weight components within Toyota's hybrid engine, which operates with an Atkinson-Miller pumping cycle rather than the usual Otto, is the key.  GM choose to just use their stock engine from Cruze instead.  That cost-saving measure is hardly elegant.  Making the engine more efficient later will increase vehicle cost.  Starting with such a large battery was a fundamental flaw.  Remember how the "40-mile range" was heavily promoted?  That transformed to "25 to 50 miles" when the realities of real-world driving were finally acknowledged.  So much for being elegant.


Plug-In Hybrids.  My favorite line today was the claim that Toyota was "rushing out an inferior item to get into the market".  Isn't it ironic how that's exactly what happened with Volt.  By the time it was rolled out, discussions had shifted over to what the next generation will offer... like improved MPG after depletion, cleaner emissions, and a lower price.  Even more ironically, all of those issues have already been addressed by Toyota prior to rollout.  At this point, they've basically just given up rational claims.  Argument points avoid those shortcomings.  So, it shouldn't be much of a surprise that the enthusiasts of Volt are focusing on EV comparisons instead now.  Heck, even MotorTrend did that with their newest review.  The 37 MPG they averaged after depletion on their 1,250-mile road trip was simply just a mention, buried within all the information about plugging in.  The hybrid aspect of the design is treated as a footnote, something so distant from all the other upcoming hybrids offering a plug that it's portrayed as being in a unique category.  But with such a wide variety of choices on the way from many automakers, that approach won't last long.  Comparing battery-capacity, motor-size, and engine-efficiency will quickly become the norm.  It is has both a plug and an engine, it's a plug-in hybrid.  No amount of semantic spin will get around that reality.


635 Points.  Last week ended with a 500-point drop in our stock-market.  This week started with the day closing 635 points below that.  Ouch!  Among the world economy problems that already were on people's minds, the credit-rating downgrade of the United States combined with worries of both Spain & Italy having serious financial trouble really stirred concern.  In fact, the price of oil fell all the way to $77 at one point.  All this really stresses the point of offering an affordable plug-in.  This is why I always liked Prius, since it placed such a high priority on price.  Finding that balance for middle-market isn't easy and it's truly amazing that such a configuration would attract so much attention.  After all, Prius is not known for the usual "performance" traits.  Acceleration is simply in the middle, as is handling.  It's the emissions & efficiency which drew interest over the years.  And with so much financial uncertainly nowadays, that will continue to draw even more.


Reminders.  Starting the week seeing this as the very first post on the new thread makes you wonder: "Well, that just proves GM was on the right track with the extended range model and the naysayers can go back to their cave."  I reminded them of those details actually in dispute; the claims were that GM could deliver a 40-mile range, 50-mpg depleted vehicle for under $30,000 by the end of 2010.  Why bother at this point?  Volt enthusiasts struggle for bragging rights, rather than just finally settle on calling it a plug-in hybrid and focus on specs & results instead.  Sure enough, another claim of EREV superiority followed ending with this: "...the Prius is way behind the curve now."  Again, such vague statements don't tell us anything.  It's just primal chest-pounding and cheerleading now.  Instead of getting reports on consumption, we get a niche with attitude.  So much for the mainstream vehicle that was promised.


Scalable.  The twisting of definitions is nothing new; however, it's like changing rules of the game while you're playing.  This is why the push for stating goals was always so important in the past.  Quantifying expectations makes it very difficult to change promises later... when you discover things are going as planned.  Anywho, the reference to "scalable" in the past was always with respect to attaching the same transmission design to a different motor & engine size.  This became a very big deal for Two-Mode, since the rollout began with 8-cylinder engines but was always intended to support the 6 and 4 variety too.  All the components within would connect & interact the same way, size would simply be smaller... hence scaling.  The latest twist on this was to claim "scalable" actually meant the ability to fit the same hybrid system into a different vehicle.  In other words, it would just be an expansion of production via rebranding (a practice the bankruptcy plan stated GM must discontinue).  Needless to say, I didn't buy that for a second.  It did though bring up something that hadn't ever been pointed out, probably because proof was so readily available.  It was the ability to support different battery-packs.  We know for a fact Prius can do this from all the current aftermarket offerings as well as the upcoming factory plug-in.  In other words, scaling can be motor, engine, and battery size.  Now that's scalable.


Business vs. Engineering.  This continues to be a problem.  Of course, it didn't surprise me at all to read this today: "The request was for questions she could answer.  She's not in sales or marketing.  She's not an executive.  She's an engineer."  We've dealt with that countless times over the past decade already.  He's the latest attempt:  That's been a fundamental problem with Volt from the very beginning... heavy emphasis on engineering with almost total disregard for business (high-volume profitable sales).  Remember the audience, many of whom struggled understanding the difference between want & need in the past.  Lack of balance like that will kill a well-engineered vehicle.  We've seen that already with Two-Mode.  The priority of price was neglected in favor of things like power instead.  Volt most definitely could have strived for an affordable design instead, allowing for an increase in power & range as battery technology improves.  How an engineer can answer a "poised" question is mysterious.  That's very much an aspect of business.  From engineers, we look to them for improvements (cost, efficiency, implementation, etc) of the technology itself.


Hybrid Dashboard.  Watching Two-Mode struggle to survive should be a great educational example, something for Volt enthusiasts to carefully study.  Instead, they totally ignore it.  This is why I get so worked up about claims from anyone supporting GM.  How can such a failed effort be so easily disregarded?  After all, it has gone so bad, investment in eAssist (BAS) continues to strive to fill in the gap Two-Mode could not.  Sales for Yukon, Escalade, Tahoe, Silverado, Sierra in July were respectively: 46, 40, 29, 26, 11.  That's hardly Prius killing technology it had originally been promoted to be.  In fact, it hasn't proven to be scalable either.  There still isn't one will a smaller engine offered, after all these years.  185 sales of Highlander was more than all those others combined.  And the 652 for Escape certainly emphasize that point.  The most impression though was Sonata.  That new hybrid saw 4,177 sales in July.  That was second only to Prius at 7,907.  The hybrid in third place was the Lexus CT200h at 1,552.  The others haven't given much of a clue what to expect either way, they just sell in modest quantity for now.  For some perspective, looking at the 931 sales of Leaf should give moment for pause.  What does that indicate?  I see it as a sign that plug-in hybrids priced for middle-market possess great potential.


Economy Plummet.  The stock-market here took a nasty dive, 500 points in a single day.  The price of oil followed, dropping to a surprising $86 per barrel.  All that was a reaction to the deficit deal... which was obviously far from ideal.  No new revenue spells trouble.  Recovery will take longer than anyone wants.  Business & Consumers will remain hesitant to take investment risks.  What that means for the automotive industry is anyone's guess, especially since interest in fuel-efficiency continues to grow.  Some seem to think the subcompact market will take off, mostly due to the inexpensive price... and the fact that 40 MPG has been heavily advertised as efficient.  That certainly sets up a nice situation for both the new larger Prius and the plug-in model.  Those choices will still be within affordable reach, selling themselves based on size & mpg rather than needing "it's worth it" justification.  Next years is becoming a year of change, when we witness decisions being made which will clearly market the end of guzzling dinosaurs.


Sales Expectations.  It didn't take long for the spin to begin.  Some hope you haven't been paying close attention, allowing them to establish new expectations without being held to anything previously stated.  Yesterday, it was mention of the "the 32-mpg Chevrolet Equinox", which is totally misleading since the combined MPG is 26 and city just 22.  Needless to say, I'm tired of this lowering of what to expect.  Here's what I had to say about sales:  60,000 per year has been the standard Prius has been held to for mainstream status over the past decade.  Volt enthusiasts stated over and over again that same sales quantity would be achieved in the second year.  They have also repeatedly mocked Toyota for only planning to deliver 16,000 of the plug-in Prius the first year here, disregarding overall production.  In other words, the precedent has been well established to measure market success for each market individually.  So based on that criteria provided by Volt enthusiasts, the 45,000 available next year will not meet that sales objective.  For Volt to be the "game changer" it was hyped to be, sales must grow to a self-sustaining level prior to the tax-credit expiring.  Otherwise, sales will plummet as soon as that taxpayer funding ends.  Put it this way.  All along the need has been to deliver a plug-in vehicle configured for middle-market, achieving high-volume sales quickly to allow the discontinuation of traditional vehicle production.  How long are we going to have to wait for that to happen?


Upcoming Sales.  7,907 Prius were purchased here and 24,220 in Japan last month (the top-selling vehicle there).  The topic of discussion on the daily blog for Volt was: "After a necessarily slow July, Chevrolet Volt sales poised to significantly increase."  I wanted to know what that actually meant, but refrained from posting anything until midnight.  There were 84 posts by then.  I was happy to point out:  Notice how everyone avoided the topic itself.  There's lots of excuses, distractions, and exaggerations about previous sales, but nothing about what to expect from the production increase.  What does "poised" actually mean?  Obviously, last year's expectations clearly didn't get met and hopes following rollout were horribly vague.  So, what's realistic now that the hype has been replaced with real-world data?  In other words, what sales counts would be acceptable for August, September, and October?


July Sales.  The celebrating among GM supporters is troubling, since the 500 million shares the United States Treasury purchased for $33 per share are now only worth $27.05 each.  That's a huge loss for taxpayers.  They continue to cheer for Cruze popularity too, arguing that impaired production from the Japan automakers doesn't contribute to that at all.  The count was indeed impressive nonetheless.  With 24,648 purchased, that does indeed make it a top-seller for the month.  Though, only 19 percent were actually the much bragged about ECO model.  As for Prius, the selling of 7,907 here is a head-scratcher, since we have no idea how many were actually available.  Camry did well with 27,016.  The 17,577 for Corolla wasn't too bad either.  It's all rather bit mysterious still... especially with gas so expensive and the other hybrids really struggling for sales.  Volt is just clearing out 2011 inventory at this point.  There are roughly 100 left to sell.  Combining that with the 125 used within GM itself and the 550 at dealers as demo models, the grand total comes to 3,975.  Who knows how the rest of the year will play out.  The new larger Prius rollout, the new hybrid Camry rollout, and details about the upcoming plug-in Prius should shake things up.  I'm looking forward to that.


Understanding Vastness.  Some of the nonsense I have to tolerant is truly unfounded.  No matter how much proof they have that they are wrong, some continue their attempts to mislead anyway.  Of course, he could just be in denial.  After all, that happened last year when the direct-drive aspect of Volt was revealed.  His response to my vastly better comment was: "If you don't understand the vastness of the difference, you’ll experience it when your PIP has to start the engine when you drive up the ramp out of the parking garage because the traction motor doesn't have sufficient mechanical advantage to provide adequate power on its own."  Having already pointed out that's not true, I used the opportunity to point out the information yet again.  After all, it's not like he didn't expect it:  I have already done that with the plug-in Prius.  The engine did *NOT* start.  It didn't start when I climbed the steep neighborhood hill from a dead stop at the bottom to 40 mph either.  I was also able to accelerate up hill on a highway ramp to 50 mph before the engine started.  60 kW is more powerful of an electric motor than you care to admit.  Why not just focus on outcome instead… kWh & gallons consumed… production & sales volume…


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