Personal Log #774
November 8, 2016 - November 12, 2016
Last Updated: Sat. 12/10/2016
page #773 page #775 BOOK INDEX
Brand Loyalty. I was enthralled to address this:
"From my point of view there just aren't enough reasonably priced
plug-ins to allow any sort of brand loyalty. It's too limiting."
And I did:
Until this week, there was no market. None were reasonably priced. Remember the "nicely under $30,000" target for MSRP? The reason GM set that goal was to be able to sell the vehicle to the masses. Dependency on tax-credits to achieve that affordability meant being trapped as a niche.
Prius Prime is the very first offering to deliver on that goal. $27,100 for a base price is amazing. Toyota chose to focus on cost-reduction, keeping that the highest priority of their design. The tradeoffs that required meant a very real struggle in the market of the time. So, the gen-1 wasn't offered beyond initial markets. That taught them a great deal about how to configure gen-2.
Volt choices made by GM were to instead refine the system, beefing up aspects of operation rather than favoring a cost-reduction goal. Power, efficiency, and range all improved as a result of that decision not to make MSRP the highest priority. The consequence is limited audience and continued dependency on tax-credits.
How will market growth be achieved? Just 2 years ago, we were looking at $275 per kWh for lithium battery cost. Now, it looks like $145 per kWh is actually achievable in the not-too-distant future. With the price then around $600 per kWh, a gen-2 battery-pack cost expectation (for the cells) would have come to about $11,000. Subsidizing that with $7,500 totally made sense. Obviously, that isn't how much it ended up costing. We're somewhere below the $400 level now, putting cost at roughly $7,500... perfect for tax-credit offsetting. Upon reaching that future cost, a drop of $4,700 would indeed reach the goal. Base MSRP could end up around $28,500.
That sounds like a reasonable plan... unless you look at the "too little, too late" claims. Toyota will already be entrenched into the market and the lower lithium battery cost would have become higher profit for both dealer & automaker... an absolute necessary for sales growth. At that point, the EV choices would have become competitive. Who will be the market for Volt then?
In other words, the bar for "reasonably priced plug-ins" will have changed. Just 3 short years from now, the expectation will be for those plug-ins to be able to compete directly with traditional choices, not having any tax-credits available. Toyota is striving to achieve that. This topic of selling well doesn't focus on that upcoming change... which these offerings must address.
Low Hanging Fruit. We're back on that again:
"For plug-ins, many potential buyers are willing to part with their
preferred brand." Hopefully, this makes the problem with that
view clear: That perspective only works for the low-hanging
fruit... those early buyers with little selection available. We're not in
gen-1 anymore though. The audience isn't plug-in shoppers either. How
many Prius owners have you talked to over the years, random ones you've
unintentionally encountered? Notice how many of them weren't even in the
market for a hybrid? You'd be shocked to discover the large number of them
simply discovered it at the dealership while just casually browsing.
The simple act of a salesperson offering a test-drive does a great deal
toward appealing to that audience's desire. Those buyers are very, very
different from you and I. Our purchase priorities have little in common.
Saying they are "not the same" is quite an understatement. This is
why that "Who?" question was asked so many times about gen-2 expectations.
Market growth requires an entirely different approach.
Shame. A few have become disenchanted: "If Prius sales are cannibalized, that would mean Toyota would have to do an even better job in the future. Wouldn't that be a shame." Much of that comes from not understanding all that's at play and considering what comes next. This is my attempt to convey that: I recognize your stance, but don't care for the mixed message it sends. The point of Prius Prime is to lead a way to the future. You can't just abruptly end production of the predecessor when it still hasn't been accepted as that yet. In other words, Toyota is taking the very risk our antagonistic posters have claimed they would not. Had Camry & Corolla seen falling popularity in favor of hybrid replacements, transition to a plug would have been the obvious next step. Instead, we have Prius struggling in conditions with gas at $1.95 per gallon and leaders of the world having to address emission problems without constituency support. That means risking cannibalization for the sake of reaching a wider group of buyers. Imagine if Toyota had made Prime exactly like the regular Prius... no raised floor and a 5th seat in back. It would have been a logistics nightmare. Know your audience. Unfortunately, most people don't understand the complexities of all the elements at play. So, a seemingly simple message like yours could easily be misconstrued. Think about what the market will be like 3 years from now, when we are at mid-cycle with Prime and the regular Prius is on it's 4th year.
Boost Interest. Here's the hope: "...will no doubt be more likely to be exposed to a Prime if they visit a Toyota dealer." I added to that with: That snippet identifies a fundamental struggle GM has experienced with Volt. They were able to attract enthusiasts, but the scope of buyers never reached the showroom floor. With a base price of just $27,100 and the next model up offering a 11.6 inch display, SofTex seats, wireless phone charging, and charging cable lock for $1,700 more, it’s enough to entice the casual shopper. Catching interest of someone just exploring what the dealer has to offer is a major benefit GM has not been able to achieve with Volt. Toyota certainly is giving that a shot with Prius Prime. People have always argued the standout design of Prius is what drew purchases. We're seeing market shift over to LED lighting to stir appeal. It's working too. The fact that Prime takes advantage of that should put it among the top picks for new interest. It's hard to imagine people wanting the old-school look for too much longer. There's that dual-wave glass in back as well. That adds a bit of style no other vehicle can compete with, yet. It's far too early still. But the potential advantage over offerings of the past is clear. Market growth is absolutely essential. The challenges of selling of plug-in vehicles with gas so cheap now (just $1.99 per gallon here) and the recent election outcome threatening to harm environmental progress are really big. The approach Toyota is taking could really help boost interest.
Excellent Summary. The bigger discussion took an interesting turn: "All I have to say about seating is if you need more seats you need a bigger vehicle. A bigger vehicle won't be as efficient which is what this prius is designed to be. Prius V or rav4 hybrids are more family oriented." More people are growing tired of the pushback without substance. I added some perspective to the sentiment: I see the situation with Prius Prime very similar to Prius of the past. A lot of people complained that it wasn't as big enough to fit a large driver. We continually had to point out that if you wanted a full-size vehicle, you had to buy a full-size vehicle. Prius was a midsize, for midsize people. Now, we have to point out that Prius is a midsize, for midsize families. You can still fit 2 car-seats in back. You can fit 2 teenagers in back too. So, saying that "Toyota didn't want people with families to buy the Prime" is quite misleading. If you have a full-size family, you should buy a full-size vehicle.
Knowing. Ugh. How do you respond when a well
known troll posts this: "Same as the Volt?"
He thrives on contradictions, so dropping that bait would be fruitful.
Productive information exchanges can result. It's not always a bad
thing. Perhaps this will steer the discussion in a constructive
Know your audience.
GM had a major upset with Two-Mode. They targeted those yearning for a better giant SUV. Unfortunately, the result wasn't that efficient, didn't offer comparable power, and was very expensive. So, GM moved on, targeting those yearning for a better compact car for that next attempt. It didn't lack in power, but wasn't as efficient as hoped and was very expensive.
All along, I kept asking the same question over and over and over again... Who is the market for Volt? The reason was simple. I wanted clarification about what audience GM would seek for gen-2 Volt. Unfortunately, the lower price and improved efficiency didn't do any good. Turns out, they targeted those same buyers, resulting in flat sales. No growth.
Toyota isn't making that same mistake. Seeking out a niche group doesn't make any sense with a goal of wanting to sell the vehicle in high volume. They targeted the masses instead. It starts with drawing in enthusiasts, but offering compelling mainstream features instead. Power & Range is traded for a much lower price and much higher efficiency.
To grow the market, you must do more than
retain the strongest traits of Prius though. This is how the seat variation
in back and the large screen come into play. We will quickly see the
initial interest from enthusiasts be replaced by ordinary traditional
buyers. How that's accomplished is the magic part. This seemingly strange
rollout availability is simply a build up for demand. Salespeople get used
to the paradigm shift. Once that happens and enough early owners share
their experiences, supply is ramped up. Showroom floor discoveries begin.
Growth is achieved.
Clickbait. That term gets heavily used now. It came about from all those enticing links publishers put at the bottom of articles, headlines & photos intriguing enough to compel you to click them. Many people do too. Most of it's a waist of time. But that's what gets you to stay. So, that's what they do to keep you. Today, it was discussion of how "hydrogen" gets those interested in plug-in vehicles to take a closer look. Virtually all of it is propaganda. Pointing that out is quite a challenge though. Far too many fall for the bait. And of course, if you read the same spin often enough, you begin to believe it. I kept my response to that short: Spin of electric-only killing off fuel-cell is indeed clickbait. They are not mutually exclusive. As much as some people will try to convince you co-existing isn't possible, the expectation of a one-size-fits-all solution simply isn't realistic. Think about how much of the electrical system they actually share.
Measure, How? Here's food for thought: "The manual states not to
leave the battery full for long periods of time. Unfortunately, they don't
get any more specific, so it's up to each owner to decide what is best.
leave mine between empty and half full, depending on the situation, but
sometimes i get caught with my pants down and no charge. Even trying to
do this, i have seen about 15% degradation since new." I'm
getting really annoyed by his lack of effort to share detail. From the
snippets of information he has shared, his EV range dropped that much... but
is still more than I have ever experienced. If I remember correctly,
he was averaging 17 miles. So, you can see why I have difficulty
accepting the edge he lost over the years as a problem. Nonetheless, I
still try to remain constructive:
Long periods of time would be weeks, like when you go on vacation. Shorter, it's just fine. Simply leaving it partially depleted is an easy way to avoid that. You still have a 15% buffer regardless, since "full" is really just 85%. Exceeding it would only come from routinely drive downhill for many miles at a time, those who live in areas with mountains or deep valleys.
More likely is not allowing the battery to rest before recharging. That's called a "cold soak". The timer feature helps make that easier. Chemicals inside benefit from the opportunity to settle and cool down. If you plug in right away after driving EV or expose the car to extreme heat, it will shorten battery-life.
As for your 15% degradation, that doesn't tell us much. Some owners never see levels other owners do anyway. With mine, I haven't noticed any real loss after 4.5 years. It's still delivering 13 miles of consecutive EV on good days. That's more than the 11-mile rating. How should measurements be made years later? We don't have a method available.
That's Reality. This quote from a recent article about Toyota's intent for 2020 sure stirred discussion: "Toyota aims to develop an EV that can run more than 300km on a single charge. The platform for models such as the Prius hybrid or Corolla sedan is being considered for use in building an electric sport utility vehicle." Naturally, there was the usual hydrogen rhetoric. But if you can get past that, there is some constructive discussion taking place. Unfortunately, that can easily get derailed with nonsense like this: "This reads as half-assed effort, even they probably don't know what will come out of it." Lack of substance to the claim makes you wonder if it is even worth responding. But then again, not saying anything is to enable. So, I didn't keep quiet and asked: Knowing your audience translates to half-assed effort? No, it's called market awareness. Notice what happened with the election yesterday? You can suggest a dedicated EV platform all you want, knowing it is the better choice, but that doesn't mean people will buy it. We are a market obsessed with consumption and making bad choices. Look at how poorly Volt has sold and how popular the plug-in Outlander is. That struggle for sales GM has had is far from what Mitsubishi is experiencing. They are both plug-in hybrids. The dedicated platform Volt offers simply doesn't appeal to the masses like a compact SUV with a plug does. Like it or not, that's reality. We have to find a way of playing the game. Notice how popular the hybrid RAV4 is. Why not offer a model with plug augmentation?
Road Trip Photos. 4 years ago, just 1 month into PHV ownership, I went on my first road trip. It was up north, to the usual destination. But being Minnesota in the Spring, weather is quite unpredictable. We ended up getting quite a bit of snow. I hadn't packed an ice-scraper either... since the first day was absolutely beautiful. In fact, I had brought the bikes along. The hope had been to take a trip on the trails. That time of year is beautiful. There's a mix of open water and ice still on the lakes then. The breeze has a bit of warmth. Sunshine is refreshing. It's a nice opportunity to shrug off Winter, despite driving north rather than south. Take a look at what I captured with the camera. That brand new Prius PHV looked great next to the budding trees at the boat-landing. It's the same location I took photos at many, many years ago with my Classic Prius. Check it out... photo album 190