Prius Personal Log #840
October 31, 2017 - November 3, 2017
Last Updated: Sun. 1/28/2018
page #839 page #841 BOOK INDEX
Leadership. Refusal to acknowledge facts leads to
cherry-picking so well accepted, you don't even notice the altered
perspective of reality:
"...awards those manufactures who have taken the risks and are now
established as the leaders." Leading people in the wrong
direction is not good! This is why stating goals has always been
vital. Yet, many absolutely refused to. Volt turned into a
disastrous waste as a result. Delivering a great product to for such
a small audience was a terrible plan. They endorsed it though,
assuming the leaders knew that path was the correct one. Clearly, it
was not. Now, there's a mess to deal with. Thankfully, we're
still in the early stages. So, despite the disaster, it's not a total
loss. The situation remains a matter of stating goals. This is
what will put GM back them back on the right path. Unfortunately, it
points them in the direction of Nissan & Toyota, who already have sizeable
head starts. Their pride will likely make the next step harder as a
result. But any step forward in the right direction, even a small one,
is progress. My words this time were: Leadership in the early-adopter
phase (defined as gen-1 offerings dependent upon tax-credit subsidies) is
very different from leadership in the next. The struggle to overcome this
new barrier is known as innovator's dilemma. To be a successful in
the mainstream phase (defined as high-volume profitable sales able to
compete directly with traditional offerings) requires cost to be low enough
for competitive pricing. In other words, no manufacturer is actually
an established leader yet.
Flag Waving. Knowing how much of Bolt is from Korea, reading statements like this is annoying: "Only change i would make is, STOP giving american taxpayers rebates to FOREIGN car companies." The irony is rather redeeming though. They blindly wave the flag without bothering to actually do any research. The fact is, we see LG supplying GM with battery cells, the completed pack, the management system, the power electronics, the traction motor, and the transmission. That's a major portion of the vehicle. What non-foreign components make it worthy of stopping subsidies? We benefit from reduced oil-dependency and cleaner air regardless of where the business headquarters are. Manufacturing of vital components is clearly not in America. Annoyed, I posted: There are many clichés to describe the unintended consequences of such a decision. Instead, define a clear purpose. With a precise goal, it's much harder to take away. In this case, there was no obvious intent. Was it to prove the technology? Was it to attract mainstream buyers? Was it to help establish infrastructure? Was it to get automakers to try something new? Fundamental clarity is essential. Notice how we still have no idea what purpose public chargers are intended for? There is no agreement of any sort about who should use them, for how long of a duration, and for what price. It's so confusing ever to us. What message does that send to those considering a plug-in vehicle. Heck, we don't even know how to deal with a ICE'd charging spot. It's time to step back and ask what's really important. Disagreement about petty things, like battery-pack size, have been a massive waste of resources... our own brains about how to effectively entice new customers to buy.
Being Warned. What can you say to this: "Did no one believe us when we warned everybody that this would happen?????" You spend years showing concern. They spin it to make those posts appear to be attacks. Anything a Toyota owner says must be an effort to undermine GM. They were too ignorant to believe an partnership among plug-in owners would be possible. That has cost them dearly. Mistrust is such a waste. What did they have to lose? Was it really that much of a risk to not even try? Ugh. Oh well. Turns out, they lost far more than ever imagined. All I can do now is remind them of those mistakes to help prevent them from repeating... yet again: Sadly, no, it was quite the opposite. When I brought the topic up, there was an enormous amount of effort expended to assure people this wasn't anything to be concerned about, that I was just spreading FUD. So now, it's long overdue to acknowledge the reality and come up with suggestions about how to proceed. My suggestion was originally to offer a second model of Volt with a smaller battery-pack, which would make it both more affordable and more efficient. Upon the realization of how misaligned gen-2 was with needed audience, the suggestion became a switch to just focusing entirely on getting a plug-in choice for GM's primary buyers... SUV shoppers. In other words, find a solution that doesn't require tax-credit help ever. Make sure the initial rollout MSRP is relatively competitive with other GM offerings. Set a target premium. For example, design a Chevy Trax to deliver a plug with a price no higher than $5,000 above the median traditional package price.
Continued Attacks. This is all you need to get an idea of what I encounter routinely still: "...are admitting the weak position of the Toyota Plug-in entry? What a flake car." That smug attitude of being "vastly superior" from some enthusiasts is alive & well still. The difference now though is their voice is beginning to get drown out by other plug-in owners. There's power in numbers. The voice of ordinary consumers can be rather loud too. This is very much a welcome change. I jumped in with: Production capacity is key to making prices competitive with the fierce challenges of overcoming guzzler appeal. Toyota is looking to deliver 50,000 worldwide this year. That's a very clear push toward sustainable high-volume sales. How is that a weak position? This is what I pushed for Volt, hoping gen-2 would take on an affordable design approach. But rather than doing what was necessary to achieve that much lower cost, GM stuck with the "strong" position and ended up delivering a vehicle only appealing to early adopters. Face the reality that the ability to appeal to mainstream buyers requires more than just delivering faster & further design. GM has a very real challenge approaching with the loss of tax-credits and much lower MSRP choices from other automakers on the way. Are you really going to waste time posting stuff like that, rather than providing constructive suggestion? Bolt had a strong sales month. What are you going to do to help promote it to sustain that success?
Halo Effect. Each month, slipping sales brings out rhetoric so effective, the people spreading it our clueless as to what they are actually saying: "Brings people into the showroom so they at least consider Chevy." Remember how that used to be a bad thing? Now, the misdirection is thought of as a normal part of the purchase experience. Sadly, that's the perspective I have come to expect from the Volt enthusiasts. They simply don't care about actually replacing traditional vehicles. It's a matter of pride now, protecting reputation by putting up a good show. That's such a disappointment... and such a waste. Oh well. I keep providing those reminders: When a person is shopping the showroom, we want them to actually purchase the vehicle that catches their attention. Having a "halo" vehicle instead is in no way what I posted. As for the rest of what you posted, it indicates being a "niche" vehicle. That is a problem too. We want to sell lots of the vehicle, not use it as a technology showcase. Sales in high-volume is a necessity for the automotive business. Simply selling lots of guzzlers instead, like Equinox (25,722) and Malibu (14,647) and Traverse (11,098) in October, is not the outcome we want. And with the possible abrupt end to tax-credits, it's going to be even more difficult to sell Volt... and for that matter, Bolt. Think about the anti-plug movement that's growing. Search the internet. You'll find articles stirring FUD about batteries. The best defense against that is getting more plug-in vehicles on the road as quickly as possible.
Enthusiast Obsession. Sometimes the blindness from faster & further makes even the basic understanding of how ordinary customers approach the process for selecting a new vehicle impossible to see. They simply have no clue others don't share their priorities. For example: "Are you suggesting that "showroom shoppers" look for Dualwave glass, Predictive Efficient Drive, and Directed Heating & Cooling? Sounds like a bunch of buzzwords to me to detract from less electric range, less seating, fewer airbags, less horsepower, slower 0-60, etc." A mainstream consumer wouldn't even encounter that information until it is stumbled across right there on sight. Ugh. All I can do is point out their oversight... which I don't expect to do any good: Not understanding the "buzzwords" will do that. This is why the in-person experience plays such a vital role. Also, use of "less" and "fewer" and "slower" is an indication of not properly recognizing mainstream audience. As much as people like to believe the marketing of those traits is the bulk of what buyers actually buy, it simply isn't true. The masses go for balance and don't obsess about wants like early adopters. None of those standard safety features listed draw in customers from whatever they may stumble across prior to going to the dealer. But once they are there looking at what's on the window-sticker, things like Dynamics-Radar-Cruise pop out as a strong want. As for the dual-ware glass, in-person compliments are plentiful. Most people say "Whoa!" when they see it, then start asking questions... which is exactly the type of showroom reaction salespeople want. Know your audience.
Grow Sales. Reminders of what's important need to be provided too: AFFORDABILITY was always a top priority for me and no amount of Volt enthusiast rhetoric could break that priority. It was a very real concern that sales would struggle from high prices, even with heavy dependency on tax-credits. APPEAL to mainstream consumers was the key and still is. If you can catch the interest of someone casually shopping the showroom floor, you have a product able to please consumer & business need. Volt never could achieve that, despite all the faster & further hype. REALITY is crashing down with an onslaught of guzzler support. We don't want to lose momentum on plug-in vehicle acceptance. That means making hard decisions and acknowledgement of a changed market. Let go of the past… otherwise, I'll just remind you of my concerns having been validated. Look forward. What do we do now to grow sales?
History Exposition. It's difficult to slip in details about the past on that new venue, since the response is quite unpredictable. You have to try though: Prius PHV never remotely shared the same purpose as Volt. Toyota rolled out a mid-cycle upgrade to 15 states, testing the waters with real-world market research before going mainstream. Watching GM struggle made the decision to postpone expansion until the next full-cycle easy. That meant not having to deal with gen-1 differences at all in 35 states. The gen-2 model would be new to dealers, mechanics, salespeople, and customers. Prime is what ended up being the first with mainstream intent, with a worldwide rollout all in the first year. The total sales for 2017 will end up exceeding 50,000. Growth is absolutely essential. We are no longer dealing with early adopters. Appealing to ordinary consumers is very different. Toyota was well aware of that situation. GM clearly was not.
Targeting. It's interesting to read comments on the new venue, one for plug-in supporters of all types. There, the well rehearsed debate material can be presented to a new audience. Results are dramatically different than that of the Volt blog prior to 2017: There's a fundamental misunderstanding of market still at play. Who is GM targeting? Looking back to the beginning of the plug-in hybrid offerings, the most common trade-in for getting a Volt was indeed Prius. But with those Prius at high miles and with GM leases so cheap, who wouldn't choose that? Volt never appealed to the masses, only early adopters. It was low-hanging fruit though, now all picked. When the leases expired, they moved on. Fast forwarding to the gen-2 rollout, we found out that GM decided to leave the rear seating cramped and only modestly improve HV efficiency. That left Volt in a difficult position with the "range anxiety" sales strategy. Why not just buy a Bolt instead? After all, most Volt owners did everything they could to avoid having the engine start. We now see Toyota & Hyundai/Kia targeting the void GM was never able to fill, offering an affordable plug-in hybrid for the masses. Prius Prime is loaded with safety features standard and is more efficient in both EV and HV modes. MSRP is so low, the phaseout of tax-credits won't even be an issue. Volt's is far too high still. Success of Bolt is great, but it does leave you wondering if GM plans to compete in the plug-in hybrid market.
Oversimplification. Certain names pop up from time to time. They are the antagonists. Their intent is to undermine in any way they can. Today, it was the subtle approach: "There are no free power conversions. So, using gas to charge the battery will always be less efficient than using gas to drive the wheels directly." This would seem reasonable... to the uniformed. That means direct confrontation would halt the assault, but leave those newbies confused or misled. That meant I had to be subtle in return: Oversimplifying efficiency equations is a common problem. It's very easy to overlook the opportunities the power-split system exploits. Using an aftermarket gauge, watch RPM of the 3 components at play all at the same time: gas-engine, traction-motor, generator-motor. You'll see the flow of power being redirected several times per minute. That's because roads aren't really ever flat or straight; traffic isn't constant either. Those tiny variations are losses. The hybrid system takes advantage of them, reducing their impact. The result is an efficiency gain. Each opportunity adds up to a noticeable overall MPG boost.
Spinning History. You've got to like this: "This was the plan all along." That quote emerging out of the shift from Volt to Bolt is most telling. When reality of the situation first became apparent, reaction was to suppress information to that affect as quickly as possible. It was a state of panic. Enthusiasts were about to be exposed as hypocritical for now supporting the very thing they had for years fought so hard against. To change perception, they instead claim that was the plan all along. Clearly, it was not. It is heavily documented in these blogs, confirming otherwise. There isn't any need to look backward though. Knowing that past isn't necessary. Just look at what's happening now. 3,053 available 2018 models in inventory waiting for the 2,614 remaining 2017 models to be cleared out speaks for itself. Clearance time should have been over in August. Dealers don't like getting stuck with so many unsold vehicles, especially the ones that are low-volume. Claiming that was the plan all along requires disregard of some important factors. Looking forward makes the claim even more difficult. Production of Volt has been shutdown and won't resume until early next year. What will expectations be for dealer interest? Why would anyone believe the waning interest will encourage ordering more? With the upcoming phaseout of tax-credits, it is reasonable to see Volt becoming a sold-order vehicle rather than keeping them in stock. In other words, we're seeing a shift of priorities. This topic of labor practices is undeniable evidence of that. The days of "vastly superior" engineering focus are over. Business is taking precedence. That's good in regard to support, but it reveals much about what GM still must address to make Bolt a success.
Charging Prices. There are a lot of napkin calculations taking place now. We are far from any type of pricing pattern or consistent message. There's lot of variety out there and the prior generation of plug-in vehicles certainly didn't establish any type of expectation. I jumped into a discussion about that when this came up: "Guess 240VAC public charger (rate of $1/hr)". Hopefully, it will help stir interest: Keep in mind that public-charger pricing varies dramatically. The ones just a few blocks down the road from me are free. The ones further off at the park have a flat per-use fee along with a per-hour rate. The ones at the mall are per-kWh. The ones at work are for an 8-hour span with a single price, but there's a fee if you exceed the time. Electricity rates will vary dramatically too. I pay 0.0710 per kWh (tax included) for overnight charging. During the day (non-peak, tax included) the price is 0.1204 per kWh. For the after dinner hours (peak, tax included), the rate jumps to 0.4180 per kWh. If you want to take advantage of pre-conditioning, rather than getting into a cold car, that electricity must be accounted for. However, that is a luxury feature many would be willing to pay a premium for. Running MAX-HEAT on the 10-minute remote climate cycle will consume 0.37 kWh.