Prius Personal Log #960
August 11, 2019 - August 16, 2019
Last Updated: Sun. 10/06/2019
page #959 page #961 BOOK INDEX
Cost Reduction. When Toyota designs something, there is always that quest to reduce cost. Achieving that through high-volume is an effective approach. The benefit is well proven. Think about the product-line as a whole. RAV4 PHV using a 13 kWh capacity battery-pack would be ideal to share with the next Prius PHV. That would fulfill an expectation of 60 km. It's in the realm of realistic options to pursue. That's why real-world research with mules takes place. They give the design a try, hoping to gain a confidence of it being a wise choice. If so, great. If not, you try something else. The key is to consider as many factors of influence as possible before committing. Reducing cost is challenging enough. Oversight can be costly. This is why was see Toyota rolling out to limited markets. They go to great lengths to validate decisions about stuff related to size & capacity.
Setting Expectations. Today's discussion was interesting. Out of the blue, someone just wildly threw out there what they believe EV range for the next Prius Prime should be. Of course, it didn't take audience into consideration. In fact, cost was entirely absent from those posts. There was nothing related to automaker or market either. That lack of any effort to recognize big-picture need is a red flag. Missing any reference to sales goals is a warning that scope & timeline weren't included in the calculation. That's even worse than being unrealistic. You can't exclude the fundamentals of business and expect to succeed. That's is why I get eye rolls from my posts though. Few, if any, in online forums really want to discussion economics, marketing, or accounting. There's nothing exciting about those non-engineering aspects of the automotive world. So, many just pretend that stuff just magically works out if you have the right design. Ugh. I hoped to get the discussion back on track by providing a basis of analysis, giving them some actual numbers to consider back pointing out background: The unit-of-measure for a vehicle designed in Japan is metric. In this case, kilometers. For gen-1 Prius PHV, that target was 20 km. For gen-2 Prius PHV, that target was 40 km. For gen-3 Prius PHV... knowing that affordable & reliable has been higher priorities than range... would put it at 60 km. That's 37 miles.
Oops! I really like where this took the discussion: "EV's
may indeed become the dominant mode of ground transportation, but that
evolution will not happen overnight either. It has the be competitive with
the current technology and work within an evolving infrastructure..."
In the automotive industry, that term "overnight" equates to a generation-cycle. Which means, being able to take the market by storm still takes 6 to 7 years. That's why Prius is still the only single vehicle in modern history to bring about a paradigm-shift. Tesla can't be included, because it started fresh, there was nothing for it to change from. Tesla was also very heavily subsidized by both tax-credits and investor-capital. Being a start-up means lots of low-hanging fruit, but major challenges after those picks are gone.
That brings us to the legacy automakers. Even if there was a will, there is not a way. We are now seeing the same desperation for profit as we did in the past. That pattern repetition can no longer be denied. In fact, it appears to be even worse this time. Anyone else remember how heavily Ford & GM relied upon SUV & Pickup sales for sustainable business?
This particular discussion is yet another component to the market taking a downturn. Notice how many announcements we get about a far better options than hybrids coming, but no detail whatsoever? Those incredibly vague promises of amazing future technology is exactly what we got in the past. Remember how GM attacked Toyota with all that "stop gap" propaganda? What about Two-Mode? What about ULSD vehicles?
It's about to get ugly for some automakers. All the belittling of Toyota for having prepared for such an "unlikely" turn of economic influence of the plug-in market is gone. Anyone else notice how the "leader" and "behind" insults have vanished from comments? For that matter, notice how antagonists themselves have disappeared? That's a sign of problem recognition... like, oops!
Low Sulfur. Remember the diesel insanity way back in 2006? That's when ULSD (Ultra Low Sulfur Diesel) was rolled out. It was to be the savior of diesel, a means of competing with hybrids as a clean solution. That obviously didn't actually work. True, it did indeed reduce emissions. But the reality was, that wasn't enough. Diesel was still dirty in comparison and no where near enough to be called "clean diesel" as the campaign to deceive tried to make you believe. Well now, that necessity to reduce emissions coming to the shipping industry. The new regulation coming for January 1, 2020 from the International Maritime Organization (IMO) will be requiring lower-sulfur fuel oil. That will help considerably; however, it's not a perfect solution. It will be expensive too. To be more clean, more refining is necessary... which increases cost for the fuel and cost to retrofit some existing equipment. This is why there is still on-going research into the feasibility of fuel-cell use for large container-ships. They must find a means of cleaner transport. Think about how much fuel each one of them consumes.
Notice. I'm back to the "notice" posts again: "I think Toyota had made a similar strategic mistake with its Prime availability. Kind of a self fulfilling prophecy by limiting these vehicles to specific areas of the country." That begged for them. It's because most people don't. So, I end up sharing my observations. I collect lots of data spanning a wide array of influence and watch for patterns, which requires a lot more effort than simply agreeing with a trend. It means what I observe commonly goes unnoticed by others. In this case, it meant I had this to share: When looked upon in a vacuum, it may appear that way. But when looking at the bigger picture and longer duration, the prophecy to insulate themselves from market fallout appears to have been quite wise. Notice how both Ford & GM are preparing for difficult times? Notice how Ford & Honda are getting skittish on hybrids? Notice how GM & VW have given up entirely on all but EV offerings? Notice how Toyota is ramping up Prime availability?
The Key. I was surprised to get backlash from posting this: "You try something. If it works, great. If it doesn't, you try something else. The key is to keep the scope of that change small." It makes sense that the perspective of being cautious gets highlighted. But no effort to see beyond that is concerning. After all, that is the trap Volt enthusiasts fell into. So, getting this stirred memories: "This is a great strategy to keep from making a major mistake. It also insures that you'll probably never find the next big thing. In math, this is known as getting stuck in a local minimum." That sounds sensible. But having proven false, it cannot be used in such a blanket way. The market is far more challenging to deal with than that overly simplistic perspective takes into account. I pointed that out with: Actually, that has been proven false. The act of being willing to refactor (take on all those small risks) will often lead to discovery. It's a constant state of looking for improvement opportunity. Eventually, you find one. In math, that's known as a complex equation. Think about what happens when you add, subtract, multiple, and divide in a variety of different ways. A small poke in the right direction can lead to enormous change. To put this in terms of the automotive market, you must recognize it is a moving target... one that doesn't follow any particular path or destination and will continue to alter as you travel. Knowing that, ask yourself what the "next big thing" could mean? If it is a battery technology, what penalty is there for Toyota working to establish a culture of change at their dealerships highlighting the benefits of electrification? Building momentum for moving away from traditional vehicles is perfectly fine taking small steps. Put another way, I'm approaching my 20th year of pursuing greener technologies. With such a strong background in that effort to engage ordinary consumers in the acceptance of true change, I see a lot of repetition... including some major mistakes. The strategy of staying true to goals is what wins every time, even if that includes very small steps along the way.
Nonsense. Reading this brought a feeling of vindication: "The Volt died because the factory it was being assembled at was closing, and it was closing because the traditional cars made there weren't selling and were being cancelled." It was just more of that desperate nature to provide damage-control. Whether the act is to convince oneself or others of the outcome, it's a disconnect with reality I'm happy to point out: Circular logic is evidence of something gone awry. In this case, it was the fact that Volt sales were supposed to grow to the level of takeover. The goal was for Volt to become the replacement. Production of that traditional car was expected to end anyway. Volt failed to achieve that. For 12 years, we had to put up with claims of "vastly superior" technology from GM becoming the dominant force in efficiency sales. This followed the disastrous hybrid offering known as Two-Mode. We were besieged with the message of needing to patiently wait for this new plug-in hybrid technology to crush Toyota. I endured countless attacks stating my concern for GM's expensive & inefficient were unfounded, just an effort to save the reputation of Prius. Needless to say, any attempt to portray a false past will be called out. Volt died because GM didn't really want to sell it. Why would any automaker continue on with such expensive & inefficient technology... especially seeing how well Toyota is setting the stage for plug-in hybrids? Looking back at how hostile Volt defenders became just 6 months ago, absolutely desperate to provide damage-control for GM by pushing a narrative of Toyota "falling behind" so much, the automaker may never recover. We now see both Prius & Corolla have PHV models and its looking like one for RAV4 is one the way. 19 years of that nonsense from those hoping to undermine Toyota accomplished what?
RAV4 PHV. There was a set of spy photos that began circulation on the internet today. Supposedly in Spain, there as a plug-in hybrid model of RAV4 being tested. That makes sense. It is a logical next-step with the spread of PHV technology. After all, the hybrid system was designed to readily adapt to using plug-supplied electricity. The simple addition of a clutch allows the larger battery-pack to supply greater power output to the wheels. It's an elegantly simple approach that supports the absolutely vital need to deliver a reasonable profit to dealers. They won't bother trying to sell something that isn't affordable. It must demonstrate sustainable interest. Toyota's approach is quite compelling. Proof of that is undeniable with RAV4 hybrid. It's next-gen upgrade has been showing strong demand already. That makes it easy to see the effort to refine an offering with a plug is a sensible move. That will most definitely help to bring the entire fleet forward, something all other automakers have been struggling with. The subsidized one-hit-wonder can't compare to a variety of profitable offerings. Needless to say, I was delighted to see those spy photos and the excitement they stirred.
Internal Trolls. When a popular forum poster gets out of hand, what do you do? I responded to this today on that very topic: "Nobody guessed --- would hit 80,000 posts by 2020." I did. I pointed out his overwhelming of the discussions too: "Seeing so many posts per hour everyday, it raised concern about drowning out participation of others." My lead up to that wasn't well received either. He got quite annoyed with me repeatedly posting know your audience comments... because it drew attention to his desperation for attention. It was an ironic means of making others aware of the resulting dilution of value... especially due to the laziness and lack of concern. His posts don't include quotes. It's always in third-person to avoid confrontation. All the words in his posts are lowercase too, making them further standout. The sheer volume is the biggest problem though. He literally posts over 100 times per day and has been for over 2 years now. So, most of the content is meaningless sound-offs or contradictions for the sake of keeping the dialog active. It's just him using the forum for entertainment. That's sad. Others who join to share their experiences or ask questions get pushed aside by his effort to retain the spotlight. Needless to say, I don't like him... and feel quite good about others finally noticing what's been going on. Trolls of that nature bring down the reputation of the venue.
Awaiting Delivery. It's nice to see posts that start with: "So far 236,000 miles..." He was telling us about his current Prius and the looooong wait for deliver of his Prime. Since he's nearby (metro of Minnesota), I'm well aware of the lack of inventory. Only a handful have been sent to each dealer. That's the way it has been all through Toyota plug-in history. The center of the United States and Southeast Coast are not part of the initial rollout regions. The expectation is that will change upon 2020 ramp-up. Supply of that mid-cycle update is only now growing in the established markets. That limitation is somewhat bothersome, but quite understandable. So in the meantime, we share stories and ask questions: What will you be doing with it when your Prime arrives? btw, I have been watching the inventory. Lots of new arrivals and sale removals have had the availability count all over the place. There's about 10 listed within day-trip distance of us now. It's looking like Toyota is well prepped to go all out, with the choice of delay being a very wise one. Not having to deal with any of the past hype leaves you and I a clear playing field. I'm excited about starting up gatherings again. Not having any local inventory put quite the damper on things. But now, it should be a reboot of how Prius got started. That was really fun the first time around. Soon.
Seemingly Forever. That's the sentiment we get from
those who don't have much (or any) background in how long it actually takes
for change to happen. In this case, it was from someone well informed,
but annoyed at the timeline: "Toyota always had the vision of making all
their models optionally hybrids, amazing how long it took." He
was painfully aware of the challenged faced when up against those fighting
to retain the status quo. I jumped in to help out:
No surprise though. I always told people it would take an entire life-cycle to even get mainstream interest stirred. That meant a minimum of a decade. More realistically, the dealer-lot to sell-for-scrape duration is 12 years. In terms of generation, that equated to waiting for two of them to pass. Since the first-gen was really just a limited mid-cycle update, the start began in 2003. Bringing us to 2015 (that 12 years later) was right on schedule. At that point, the vision was falling into place... but still not complete.
The next-gen upgrades to Prius, Camry, and RAV4 have all been well worth it. The technology has proven robust & affordable, as well as very easy to sell. It's a winning formula.
What comes next is what this "rise & fall" curiously avoided any mention of. For those paying attention, it's not much of a stretch to see Toyota striving to make the PHV option standard for the next-gen of Prius. The design focuses heavily on being cost-effective. Dealers must have a choice that brings in easy profit... a goal none of the other automakers are in a position to address yet.
It's all about high-volume sales, not breaking new ground. That's why the perception of "fall" isn't actually a problem. Toyota's goal is to transform their fleet. Narratives of a necessary to push limits are just hype from enthusiasts. What happens for ordinary consumers is what matters. Remember, automakers are for-profit businesses with salespeople who aren't well informed and work on a commission.
For those of us who watched GM pursue glory through the exploit of tax-credits understand & appreciate Toyota taking a very different approach due to having a very different vision.