Personal Log  #975

October 30, 2019  -  November 4, 2019

Last Updated:  Mon. 2/10/2020

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Supply & Demand, lost.  That topic of scarcity opened up the opportunity for antagonists to launch a new attack campaign against growing interest in Prius Prime.  It started with the usual: "Toyota had the lead, lost it, but is not totally lost."  That's the simplistic measure of progress, based solely upon perceived efficiency... which translates nowadays to longest range.  I find it quite telling when such a crude measure is depended upon.  This is why Volt enthusiasts failed to understand the market.  They never learned to look beyond just range & power.  They brought about their own doom.  I repeated that teaching moment for this new audience, who is quite unlikely to exhibit any more interest then the prior:  Leadership is finding a means of reaching the masses.  MSRP of Prius Prime overwhelmingly confirms Toyota has established a strong foothold in the upcoming market for affordable plug-in hybrids.  You get both top-rated EV efficiency and top-rated HV efficiency as at price directly competitive with traditional vehicles, no tax-credit required.  EV speed goes all the way up to 84 mph.  Heat-Pump efficiency is the industry's best.  What other automaker has delivered something capable of the same?  You want more, plan to purchase the upcoming RAV4 plug-in hybrid.  In other words, claims of Toyota having lost their lead are unfounded.  As you say, it is not totally lost.  They are an automaker who has strived to design a technology for mainstream consumer, something to bring about noticeable change at dealers.  That is very much leadership, quickly unlike appealing to enthusiasts.


Change.  No longer reporting monthly sales is really hitting antagonists hard.  They looked forward to attacking every month.  In fact, I even saw a post last week anticipating the opportunity.  It was a form of self-validation.  They seek out a means for justifying support of a flawed approach.  Each was easy to spot too.  Just look for evidence of tax-credit dependency.  When they quote purchase-price rather than MSRP, you know the scope of their view was limited to just early-adopters.  A perspective which excludes mainstream consumers is doomed.  Some are beginning to recognize the shortcomings of that approach.  Assuming economies-of-scale and high-demand would have been well established by now was the mistake.  They simply refused to be realistic.  Pretending data which reveals an oversight doesn't help anyone... and they are now well aware of the consequences of not addressing that.  I continue to point out that problem too.  The change to quarterly results becoming the standard is painful for them.  Everything related to their approach has been geared to micro.  Having to shift to macro brings about a lot of uncertainty... and reveals they were clearly not prepared for this next stage.  Oh well.  It's not like I didn't say this was coming, as my reminder today pointed out:  Limited scope of "EV Market" discussions made it a necessity.  Participants weren't looking beyond what was happening in the here & now, making consideration of buyers beyond initial subsidized sales fodder for spin.  Same nonsense every month is not what anyone in the industry should have to deal with.  Switching to quarterly will better reflect what's really happening in the mainstream realm.  That's what truly matters, not what enthusiasts say or do.  Remember, the goal is get dealers to stock plug-in vehicles as regular inventory.  That means volume well beyond the tiny monthly quantities we've been used to.  Audience growth is difficult. It starts with a change of perspective.  Think about those outside of the early-adopter groups really want to know about.


Dealer Misleading.  Ugh!  It's very frustrating... but by no means a surprise... to read this: "On the Star Tribune opinion page, the president of the Minnesota Auto Dealers Association suggested that EVs don't work well in cold weather."  That's blatant misleading.  They work fine in the cold.  True, range is cut quite a bit, but that has literally nothing to do with operation.  In fact, the powerful electric-motors and battery-packs make them more reliable than traditional vehicles throughout Minnesota's cold season.  Operation is not impacted.  It's vague statements like that which supporters really resent.  If he had been explicit, pointing out the reduction of sense of capacity (due to heater use) or the longer recharge time (increased for pre-warming), that's different.  He didn't though.  It was a blanket suggestion, void of any actual talking points.  It's the situation where supporters don't get the opportunity to add comment about how EVs deal with the cold.  For example, Prius Prime has a battery-warming system.  Even in the dead of the Winter, my gauge shows the pack is maintained at temperature of 39°F while plugged in.  That overcomes the impact of temperature on lithium battery chemistry when it drops below freezing.  Keeping it above that threshold by staying plugged in is a simple means of addressing the cold.  After all, how many people grew up having to plug in their vehicle overnight anyway?  As for the driving itself, so much power from that low-end torque electric-motors provide is clearly superior to a combustion-engine turning the wheels.  You get the benefit of regenerative-braking too.  Having the electric-motor help slow the vehicle, rather than depending entirely on brakes which can lock the wheels, is also clearly superior.  I find driving my Prius Prime here in Minnesota during the cold season a real treat.  Think about how much gas I'm not wasting when stuck in heavy stop & slow traffic.


Scarcity.  The topic of availability is stirring discussion.  Only those regions of the country which had offered Prius Prime prior to the mid-cycle update are getting deliveries.  That makes sense.  While ramp-up takes place, you really don't want demand to exceed capacity.  So, focus on where there is interest already.  Once flow of sales stabilize there, then move on to expanding territory.  Growth is vital, but not if that requires sacrifice.  Dealers are unwilling to accept that.  They have plenty of other inventory to offer.  Once Prius Prime becomes an easy vehicle to stock, then they'll actively engage.  Unfortunately, the majority of those posting online don't recognize that aspect of the business... know your audience.  So, I attempted to convey some of that information in manner others could comment upon:  With regard to dealer inventory, it has been growing well in established markets.  Watching online, I have seen the coming & going activity.  Build up to have supply on-hand for attention the PHV model of RAV4 that will be stirred should work out to be really nice timing.  Hopefully, shortly following that, the other areas of the country will start getting them.  That's right on schedule for a 2020 model rollout.  Everyone else getting them early is a plus.  Waiting for other factors to first play out should really payoff.  Some things show no benefit from being rushed.


Supposed Studies.  His don't bother claim was made from a reference to some unknown studies.  No source or even any data was provided.  It just a horribly vague imply without any substance whatsoever.  It went on to make this assertion: "People installing a charger for such small electric range is a hassle."  No detail at all is telling.  But since I already knew his purpose was to undermine Prius Prime, there wasn't anything else to learn.  So, I punched back:  That reason you provided for why "people don't bother to plug in PHEVs" is the insight I needed to confirm you aren't actually trying.  If you were, you would recant that claim and point out it was a spread of misinformation.  The PHEV you have been repeatedly belittling only take 5.5 hours to recharge using a standard 120-volt outlet.  Most households have several already in their garage.  You just plug in the device that comes with the vehicle.  There is no charger to install.  Nothing about that is a hassle.  As for the "plenty of studies" part of the claim, that's what I call useless.  No reference whatsoever was provided as a source to support the statement, making it highly questionable when the study took place, who was studied, and what the scope of the study covered.  Odds are, there was just some small sampling a number of years ago asking early-adopters what their opinion was of the technology back then.  I eagerly await something constructive as a reply to this.


Poor Range.  This didn't work either: "I have nothing against PHEVs, but their poor electric range is the reason their sales are slumping..."  It is ineffective, since it is so vague.  Posting any actual quantity brings the discussion to a different place.  So, I did:  That's called anecdotal reasoning.  You're making an observation, then drawing a conclusion unaware of other factors of influence.  In this case, you seem to not realize Toyota burned down inventory, causing a sales reduction.  That so-called "slump" was intentional.  It made no sense whatsoever wasting tax-credits on the older model of Prius Prime to compete with the discontinued Volt.  Waiting until the fall when GM was gone, then rolling out the updated model of Prius Prime while also revealing the upcoming plug-in model of RAV4 hybrid is why... vital information you did not include.  And again, there is no way to spin 9,125 miles per year as poor.  That's 76% of the annual average driving distance for most people.  If they plug in at any other time besides overnight, their EV miles increase.  That's a significant electricity benefit, period.


Cherry Picking.  When you get attack after attack, each attempting to spin a different topic without success, it's a good sign.  Antagonists get and hope something will get the attention back on them.  Each time though, shooting down their nonsense becomes easier.  For example: "Even an average BMW now pollutes less than an average Toyota."  I was amused.  He clearly just did a quick look at the chart published today and grabbed the next highest automaker, rather than considering the entire chart.  Even more amusing was how old the chart was.  That data was from 2 years ago.  Think about how much has changed since then.  That made the reply very easy for me and very difficult for him to argue:  That's a great example of cherry-picking.  Toyota's average is at 25.5 MPG.  You went out of your way to avoid mention of Ford being at 22.9 and GM at 22.9 and FCA at 21.2 MPG.  All three of those major legacy automakers are clearly trailing behind.  Omission of important data is misrepresentation.

10-31-2019 Used Market.  Armed with fresh feedback regarding audience, this was something I jumped at the opportunity to share.

A vital component almost universally overlooked when it comes to approach is the used market.  If rollout begins with the highest priced new vehicles, there's basically no way someone who cannot even afford a new economy vehicle could ever afford something used from the top.  It excludes that audience entirely. Focusing on customers who are looking for something new that's affordable means the used market will get supply... hence bottom.  With all the publicity about how reliable and low-maintenance plug-in vehicles are, it makes sense ensuring that such a large group of shoppers are not overlooked.

GM actually gave that goal a lot of attention prior to the rollout of Volt, coining the phrase "nicely under $30,000" to clearly identify the target they were shooting for.  Unfortunately, GM did an absolutely horrible job of actually meeting their own goal... missing it by quite a bit.  Ironically, their biggest competitor did deliver on that.  The MSRP for Prius Prime, which is surprisingly well loaded for a base model, is just $27,750.

Seeing how well Toyota hit the mark on affordability, it should be easy to recognize their next step... working to deploy that technology across the fleet.  What other automaker has already demonstrated the potential to deliver a successor to traditional vehicles on such a massive scale without resistance from dealers?  It's that bigger picture people online here continue to neglect.  Remember, dealers don't just sell new vehicles.  That used market impacts them financially too.


Enhanced Hybrid Battery Warranty.  This is the official statement provided by Toyota about their warranty:  We're proud to announce a significant enhancement to our Hybrid Battery Warranty.  Starting with the 2020 model year, every Toyota hybrid battery warranty is being increased from 8 years or 100,000 miles, to 10 years from date of first use, or 150,000 miles whichever comes first.  This enhancement serves as an indication of our confidence in the quality, dependability, and reliability of our products.


I Don't Want Your Junk!  I attended an event put on by the state of Minnesota.  There's an effort to make it part of CARB (those states enforcing more strict emissions regulations than what the federal government requires).  What level to commit to is what's being researched now... hence inviting a bunch of us to provide feedback.  There was much to say from EV owners.  The highlight though was when someone who was clearly struggling just to make an honest living finally got a chance to speak, then ended up screaming out that statement.  She was really upset, hearing about the subsidies given for new purchases, then getting what she believed was no longer wanted as a used vehicle.  Given the opportunity to address her directly (an unusual request) rather than taking the floor for general comment, I pointed out those used EV choices are not like ordinary used traditional vehicles.  Even the state wasn't aware of this bit of info... Toyota now provides a 10-year / 150,000-mile warranty.  A sense of awe overcame the audience, included that very frustrated person.  With so little to ever need repair and such a guarantee from automakers, market perception can change.  A used vehicle won't seem so used anymore.

10-30-2019 Intentions.  We seem to be reverting back to basic spin & downplay: "Toyota on purpose chose to exploit the tax credits by making a low range PHEV that is the Prius Prime and have it slightly cheaper than the Prius.  But the low electric range made it pretty useless."  Such a claim is easy to rebut.  The enthusiast won't accept what you post, but it works out nice for conveying some history.  After all, the online lurkers now don't have that background... especially with regard to intentions.  So, I posted:

That's the standout statement on this thread.  Toyota strived to deliver an affordable offering, one with a MSRP low enough to not have any dependency on tax-credits, and you spin it to look like they were gaming the system.  That is just plain wrong.  Toyota is well aware of how limited of a quantity the credits are and how vital it is to establish market pricing by setting a solid expectation long before using them up... which is exactly what they did. In fact, they did such a good job of that, there are credits still available for the upcoming RAV4 PHEV.

As for the "useless" claim, that's an act of pure desperation to post such blatant greenwash.  Charging overnight 365 times (daily for a year), the resulting EV distance provided would be 9,125 miles.  To say that amount of electric-only travel has no value is sad, a clear disservice to anyone promoting plug-in vehicles.

Again, Toyota's effort is to raise the bar for their entire fleet.  Focusing on just a limited offering to fulfill a specific regulation isn't a complete solution.  Certain offerings will get neglected as a result.  Phasing out traditional vehicles with a rapid replacement of hybrids and plug-in hybrids ramps up the momentum for change.  There's little resistance when you see the entire product-line adopting the use of batteries.


Knowing.  I heard arguments for years from early-adopters who thought they understood what mainstream buyers would prefer.  It was madness.  Failing to identify the mismatch, despite having it pointed out hundreds of times, turned into acts of obvious denial.  This is why I keep pointing out the source of issue.  Focus on the issue itself just encouraged the madness.  Not wanting to accept a fundamental mistake in the market they claimed to be experts of kept me going, it provided a means of breaking through their rhetoric.  In short, I saw they were wrong and wouldn't allow their misleading to continue.  Here's how I describe it online, in the context of the on-going effort to provide damage-control for GM:  That's why "know your audience" comes up so often.  GM's customer is that who purchases vehicles from them, not who ends up with it in their driveway.  Appealing to a regional manager submitting orders to stock inventory is far different from gaining thumbs-up from an enthusiast.  Think about what they must consider for drawing interest to their dealer's lots.  It certainly isn't the range-and-power nonsense we usually have to deal with here.  It isn't anything related to emissions standards either.  It's what they will easily be able to sell for a profit.  This is why early-adopters have such a difficult time understanding why the next stage of sales is so much more difficult to achieve.  It's a different audience requiring a different approach.  RAV4 PHEV is most definitely different.


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