Article: BMW’s new head of R&D says next i model not due until 2020

[Canuck]

Once Germans start driving Teslas it's going to really hurt BMW, Mercedes, etc. The comments about the price of electricity and speed limits are laughable. The horse and buggy supporters had better arguments against the gas engine.

 

[AustinPowers]

Once Germans start driving Teslas it's going to really hurt BMW, Mercedes, etc.

That might be the case once Model 3 has matured enough to be a viable alternative to an A4, C-class, Passat or 3-series in the minds of the German car buyer.
But I am sure by then the German manufacturers will have some alternatives of their own as well.
Just try and project the current e-Golf in three years time. Now imagine what VW has on its hand with that. If they can build something like the e-Golf now, what will they have by 2018? And imagine also how easy they can spread that tech across their lineup. e-Passat, e-Polo, e-Touran, e-Tiguan etc. And then there is Skoda, Seat, Audi, which basically share all of VW's tech even if it sometimes takes a while. If they wanted, they could have quite a range of BEV models ready within a very short amount of time.
Same with Mercedes. They already have great hybrids, plus two first gen BEVs (B-class ED, Smart ED) as well as know-how for building dreamcar stuff like the SLS-AMG (which even wow'ed petrol head No. 1 Jeremy Clarkson). I bet you they have BEV versions of at least the C- and E-class as well as some of their crossovers in their pipeline, even though they don't publicize it.

BMW might be a little different due to their i-Brand strategy. But perhaps their "no i5 until at least 2020" talk is just deliberate misdirection as well.

 

[Johan]

Now that is the timespan I was thinking about as well and what I tried to convey to Johan. It will take decades. And in that amount of time, I am sure all major automakers will have brought many compelling BEVs to market.

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But Yggdrasil said exactly that, didn't he? Ok, "2040ish" is not "many" decades, "only" three, but still a hell of a long time.

And I very much agree with you about the cost parity argument. It is in fact one of the reasons why I don't see BEVs anywhere near tipping point.
If I do the math for an e-Golf vs. 2.0 TDI BlueMotion for example, it will take me more than the car's lifetime to just break even, let alone get the e-Golf to be cheaper.

So if you (kind of) agree that it isn't implausible that more or less or personal cars on the road are electric by 2040 (25 years time) then during the next 25 year we would have to see a very large increase in sales of EVs and a very large decrease in sales of ICEs for that to happen, right? I'd say that in the last 5 of those 25 years there would have to be virtually only (100%) EVs sold, in the last 10 I'd say at least >75% market share and that leaves us with 15 years to get to 75% or more market share. Now, looking at an exponential growth curve I'd say it makes sense that we are at the spot where the curve starts looking more exponential than linear (this is what I meant by tipping point). For example here is a diagram from Norway (yes I know about our incentives) where the numbers are quite small but what matters is the shape of the curve:

So what do the incentives do, really? Well, IMO they just shift us about 5-7 years in to the future economically i.e. we get a peek in to where the rest of the world will be in say 5 years i.e. EVs are at or past cost parity with ICEs.

 

[Yggdrasill]

I think the graph would look similar for the world, if battery production capacity wasn't an issue. The capacity-issue will smoothe out the graph towards the right.

But I certainly think BMW is squandering some very important years.

 

[Spidy]

I highly doubt that.
Let's look 5 years into the future. Norway removes all tax and other EV initiatives: Do you really think Teslas sales numbers will stay that high? Or go even higher?

 

[Yggdrasill]

Let's look 5 years into the future. Norway removes all tax and other EV initiatives: Do you really think Teslas sales numbers will stay that high? Or go even higher?

After the Model 3 arrives, they will likely go much higher.

We are first and foremost talking about the introduction of 25% VAT. That's a significant price hike, no doubt, but we've already had an equivalent price hike due to the currency fluctuations! Did sales stop? No.

Including VAT, a Model 3 should start at around 350k NOK. That's a quite acceptable price. Especially considering that you will save 100-200k NOK on fossil fuels over the life of the car. If you drive a lot, that means that the Model 3 could be the cheapest car on the market in terms of TCO, even including VAT.

 

[Spidy]

After the Model 3 arrives, they will likely go much higher.

We are first and foremost talking about the introduction of 25% VAT. That's a significant price hike, no doubt, but we've already had an equivalent price hike due to the currency fluctuations! Did sales stop? No.

Including VAT, a Model 3 should start at around 350k NOK. That's a quite acceptable price. Especially considering that you will save 100-200k NOK on fossil fuels over the life of the car. If you drive a lot, that means that the Model 3 could be the cheapest car on the market in terms of TCO, even including VAT.

Looks like a lot more than 25%

Tax Exemptions in Norway Cut Tesla Model S Price in Half | Inside EVs

 

[Yggdrasill]

Looks like a lot more than 25%

Tax Exemptions in Norway Cut Tesla Model S Price in Half | Inside EVs

Well, there are many ways to calculate; but currently, if the BEV-specific incentives were removed tomorrow, and the Model S were instead taxed like a plug-in hybrid, the only applicable taxes would be VAT.

Aside from VAT, there are four factors that are taxed:

1. CO2 emissions (This is zero for BEVs, and leads to a 101k NOK deduction which applies to the other factors.)
2. NOX emissions (This is zero for BEVs.)
3. ICE hp (This is zero for BEVs. All electric hp are tax exempt, for hybrids, plug-in hybrids, BEVs and FCVs.)
4. Weight (This is progressively taxed per kg. Plug-in hybrids get a 26% deduction to the weight and traditional hybrids get a 10% deduction.)

What happens if a Model S is taxed like a plug-in hybrid is that the weight will get a 26% deduction, so the 2100 kg Model S will be taxed like it weighs 1554 kg. That amounts to a tax of 94k NOK. From this sum, the 101k CO2 deduction is applied, and the resulting tax bill ends up at -7k NOK (rounded up to zero). Plus VAT.

What happens if a Model S is taxed like a traditional hybrid is that the weight will get a 10% deduction, so the 2100 kg Model S will be taxed like it weighs 1890 kg. That amounts to a tax of 161k NOK. From this sum, the 101k CO2 deduction is applied, and the resulting tax bill ends up at 60k NOK. Plus VAT.

What happens if a Model S is taxed like a regular fossil car is that the weight will be taxed by 202k NOK. From this sum, the 101k CO2 deduction is applied, and the resulting tax bill ends up at 101k NOK. Plus VAT.

You can of course argue that the full power of the car should be taxed, not just the ICE hp. This requires a reshaping of the car tax system, affecting hybrids, plug-in hybrids, BEVs and FCVs, and the net result will be that the power of a P85D, with 66 kW (maximum constant power, according to some EU standard) still wouldn't be powerful enough to result in a tax.

Okay, so maybe you also change the car tax system to use the peak power output - in this case the Model S would definitely result in a major tax, though still significantly less than it's ICE equivalents, due to factors 1 and 2.

Basically, Norways entire car tax system is built up around rewarding the environmentally friendly cars and punishing the dirtier cars. You have to throw all that out the window for a Model S to be taxed as heavily as it's ICE equivalents, and that's just not going to happen. It would require a major political shift, especially considering that the current BEV incentives have a 75% approval rating in the population.