EV price war of 2023

September1

Finally other car manufacturers are making noises about responding to Tesla price cuts https://www.reuters.com/business/autos-transportation/renault-brand-sales-bounce-back-q1-up-9-2023-04-17/

French carmaker Renault (RENA.PA) is reviewing its pricing policies of electric cars worldwide to ensure it stays competitive after a wave of price cuts by U.S. rival Tesla Inc (TSLA.O), a top executive said on Monday.

ECO_Mental

Please god!! there is a price war and they come down!!!

Ce he sin

Ford of France have announced cuts of from €4,000 to €8,000 on the Mach-E so there may indeed be a war.

the_amazing_raisin

VW have so far said they aren't going to cut prices, but there's a lot of ways they can make the car cheaper without cutting the sticker price

For example they were offering lower interest rates on some models, they could also offer some extras like service packages for free, or examine the trim levels

Making a lower trim level technically isn't a price drop

In any case, it's a good thing, we needed some real competition in the market

walterking

component prices have dropped, there's an oversupply of chips now and dollar has weakened

plenty of scope to drop prices on all cars

eagerv

https://www.boards.ie/discussion/comment/120487336#Comment_120487336

All true, but customers are getting used to a certain trim level, cannot see them being happy with a lower level.

A few years ago I was happy enough with no reversing camera, etc. But hard now to go back after being used to heat pump, etc etc.

I think VW, Hyundai and others will have to drop prices to remain competitive. They will fudge for as long as possible with free packs, lower interest etc. There is only so much extra you can command for a badge..

n.d.os

https://www.boards.ie/discussion/comment/120487336#Comment_120487336

I don't think VW could remove anything else from the ID3 or ID4. They're really scraping the bottom of the barrel at the moment with their trim levels. Fair enough if they maintain a 3.9% APR as that is a good rate. The ID4 starts from €44395 and the Model Y €46521 at the moment. I'd buy the Model Y if it was only 2 grand extra for all of the extra kit, power output, and range.

n.d.os

https://www.boards.ie/discussion/comment/120487348#Comment_120487348

Yes, the chip shortage excuse won't cut it anymore. Plenty of choices out there now. Next year there will be a huge influx of value coming from China too and for the first time in the Irish car market, cars from China that are infinitely better than those made in Germany.

slave1

I don't think we'll have a price war, no one can compete with Tesla cost of production, they will be dropping prices so they don't end up with inventory to deal with rather than try and beat Tesla, sure an ID3 or Nissan Leaf are thousands more expensive than a Model 3 for example

September1

https://www.boards.ie/discussion/comment/120487336#Comment_120487336

I think they already had a stealth cut this year and they basically offer much higher trade-in values, I got valuations from VW dealer that were higher than prices on DD. When I asked other brand garage that was part of same company to match it, they called sister garage and told me that there are some special allowances from VW and they will not match it for other brand. In November 2022 VW was not doing it.

https://www.boards.ie/discussion/comment/120487452#Comment_120487452

I think being forced to drop prices to sell cars from inventory would be a price war, unless they decide to pause manufacturing and wait it out.

Fingleberries

It's crazy to think that a white RWD model 3 is just a hairs breadth above €40k (cash price, or if you arrange your own finance).

If you're in the market for an EV (and the finances work out), this would be hard to argue against - even with it being white, and not having the USS, it still has more tech and reliable software updates than most of the competition.

liamog

https://www.boards.ie/discussion/comment/120487757#Comment_120487757

The form factor of the Model 3 is problematic for me, I need a proper opening boot for the doggo.

Fingleberries

https://www.boards.ie/discussion/comment/120488193#Comment_120488193

Definitely agree. For those with prams, buggies and golf clubs, the Model Y might also be preferable - although that while not the same level of a steal, per se, the MY is definitely positively priced compared to equivalent models across other manufacturers. I think it's within €2k of an id4, but higher spec as standard.

Red Silurian

https://www.boards.ie/discussion/comment/120488239#Comment_120488239

I had a quick look on carzone earlier at 1-2 year old ICE cars of similar size to the Model 3, Mondeo's, Passats, Avensises etc they all retail for 33-39k... €1-7k more for a new Model 3 is obviously great value

https://www.boards.ie/discussion/comment/120487757#Comment_120487757

This is quite true as long as Tesla keep to their advertised delivery schedule as the grant is being cut in July which will add €1,500 to the price

...Ghost...

https://www.boards.ie/discussion/comment/120487432#Comment_120487432

Jaysus lad, ye can't be sayin' that about German cars. Ye will give the German fanboi a stroke!

As a matter of fact, I'm in Germany now and driving a BMW PHEV company car. It's probably a lease car and it's just horrible to be in. The HUD is a nice feature, but the car feels old, cheap and thrown together. I really hope BMW get back to building affordable and great quality cars.

podge1979

https://www.boards.ie/discussion/comment/120487348#Comment_120487348

Not an oversupply just yet, automotive grade chips still below where it should be, the bounce is felt with consumer electronics first. Also some OEMs suffering still more than others.

https://www.automoblog.net/will-chip-shortage-end-in-2023/

https://www.autonews.com/automakers-suppliers/chip-shortage-easing-unevenly-automakers#:~:text=AutoForecast%20Solutions%20estimates%20that%20automakers,year%2C%20Bank%20of%20America%20concluded.

Squeaksoutloud

Didn't VW even admit they were making higher margins on less turnover so maintaining the profit levels. I would say there has to be some scope for prices to come down otherwise the national fleet will be aging rapidly.

podge1979

https://www.boards.ie/discussion/comment/120489070#Comment_120489070

Yeah there was a shift in business model for likes of Hyundai and VW to go higher end more margin and less volume. Maybe influenced in by Tesla in the margins they were making. So with Tesla's shift to volume over margin now maybe the others will pivot back also.

mickdw

https://www.boards.ie/discussion/comment/120488944#Comment_120488944

What bmw is that?

...Ghost...

https://www.boards.ie/discussion/comment/120489238#Comment_120489238

It's a 225xe. Felt no better than the generic Opel rental I had a couple of months ago. I know it's a mid spec, average Joe model, but I didn't expect it to feel like an econo-box. They are a 45-50k car, but felt like a 20k yoke.

Red Silurian

https://www.boards.ie/discussion/comment/120488961#Comment_120488961

Don't Taiwan make over 60% of the world's microchips? Gonna be a fun few years if China invade

eagerv

https://www.boards.ie/discussion/comment/120487336#Comment_120487336

I see an ad for ID.4 popped up in my FB from Tom Murphy Car Sales Waterford.

Up to €3k scrappage.

3yrs free servicing.

3yrs free road tax,

Nationwide delivery.

https://www.boards.ie/discussion/comment/120489967#Comment_120489967

That's it and also the reason whey US is ready to go in to defend TW as almost any cost.

rodneytrotter15

https://www.boards.ie/discussion/comment/120489967#Comment_120489967

Not sure of the % but yep TSMC make wafers and saw die for most of the incumbents. That said lots of them are actively reshoring at the moment and building fabs or reinvesting.

listermint

https://www.boards.ie/discussion/comment/120490757#Comment_120490757

Good news for the likes of Ireland as investment around these technologies was questionable some years ago but not anymore sharp focus after Covid and Russia. Not that TMC is direct comparison to Intel though but the production facilties aren't world's apart.

podge1979

https://www.boards.ie/discussion/comment/120489967#Comment_120489967

Yep this and COVID driving changes in supply chains, shifting a bit where you see some more suppliers opening plants but building new facilities takes time. Example of this is Bosch opening a chip factory in Dresden. More a component supplier but seeing the gap in chip supply and supply chains.

Other suppliers also pushing to open plants in U.S but skills shortages maybe another issue then.

Red Silurian

https://www.boards.ie/discussion/comment/120491340#Comment_120491340

Yeah so the way I see it we are going down one of 2 roads here..

One is of peace, Tesla will continue to cut prices - but I can't see them falling much lower than where they are now after the removal of the SEAI grant

The other is of war in Taiwan as China invades

Hold on to your car for dear life as it is about to go sky high in value

Red Silurian

https://www.boards.ie/discussion/comment/120491340#Comment_120491340

Yeah so the way I see it we are going down one of 2 roads here..

One is of peace, Tesla will continue to cut prices - but I can't see them falling much lower than where they are now after the removal of the SEAI grant

The other is of war in Taiwan as China invades

Hold on to your car for dear life as it is about to go sky high in value

...Ghost...

https://www.boards.ie/discussion/comment/120491340#Comment_120491340

I'm in the tech sector and often work at chip manufacturing plants globally. Bosch in Dresden is a small enough outlet, but seems well prepared for the market. Global Foundries and Infineon are the big outfits there, but I heard TSMC may be planning a fab in the area. They are expanding and building more outside Taiwan, which is a very wise move.

It still takes years to build a site and most equipment takes a year or two from order to production.

ted1

https://www.boards.ie/discussion/comment/120490727#Comment_120490727

I got 3k scrap page in when I ordered in 2021

Stevie2001

https://www.boards.ie/discussion/comment/120488908#Comment_120488908

Tesla 3/Y are excellent value alright if your buying straight, especially compared to rivals like ID3/ID4/Ioniq and so on, an EV is still a hard sell to most people though with electricity prices the way they are though. My father just bought a new Toyota Corolla and honestly for someone like him, EV's are not attractive, Corolla came in just under 10k cheaper than ID3 as Toyota gave better trade in and Corolla list price was 8k cheaper than 58kWh ID3 too and what Tesla offered on a trade in for 181 diesel Corolla was laughable, even though M3 was cheaper than ID3 with trade in it worked out more expensive.

Then he looked at electricity prices and he's paying 33c a unit now and only better offer was 40c day/23 c night and he doesn't want to night rate and running stuff with fire risk.

At 33c a unit the savings vs petrol at 1.60 a litre was peanuts and then the ID3 and Model 3 won't make his regular journey off Listowel to Dublin on 1 charge driving 120

Basically at current electricity/petrol prices EV's are not attractive, why would you want all the hassle of an EV on long journeys for no benefit.

listermint

https://www.boards.ie/discussion/comment/120494770#Comment_120494770

Extremely limited mechanical or breakdown potential I suppose is a massive one. Reliability.

That may not be a risk though with a corolla.

waterwelly

https://www.boards.ie/discussion/comment/120495359#Comment_120495359

Shouldn't really bother a new car owner though.

Petrol and Diesel prices appear to have stabilised but electricity prices should start to fall.

I'm expecting something around 30c / 15c in the medium term.

I suspect the suppliers will hold out over the summer and when the government start banging the drum coming into the winter they will be seen to play ball, even though reductions were inevitable anyway.

Stevie2001

https://www.boards.ie/discussion/comment/120495359#Comment_120495359

Are they really more reliable though? I'm not sure that's a selling point vs a Corolla or Octavia etc

I get less to go wrong mechanically, but the other issues? some EV's have been plagued with software issues and the battery recalls, Kona, Bolt, Kia for example

The MG thread was mostly owners complaining about that oil leak for months and guys cancelling orders over it.

Stevie2001

https://www.boards.ie/discussion/comment/120495828#Comment_120495828

30c isn't attractive enough imo, fine if you can run stuff at night, but if you've kids and you can't run stuff at night, 30c a unit and the car takes 20 units per 100km, is 6euro for 100km, any decent petrol or diesel will do 5l/100km and at 1.60e a litre is 8euro for 100km

6euro vs 8 euro per 100km, is only a saving of 300euro if you do average 15,000km a year

That's a lot of money to spend and a lot of hassle re charging a car every 250km on a motorway with kids in it to save 300e a year on fuel

waterwelly

https://www.boards.ie/discussion/comment/120495967#Comment_120495967

You would really need to be charging the car on the night rate but even at that you would be saving about €1000 if the night rate comes back to something like 15c.

Stevie2001

https://www.boards.ie/discussion/comment/120495981#Comment_120495981

But don't most night rates have a higher day time rate?

Like if it's 30c/15c for day night, wouldn't day only be like 24c?

You don't save much then as you'd be running at 30c during day

waterwelly

https://www.boards.ie/discussion/comment/120496003#Comment_120496003

Electric Ireland are about 41c then 44 and 21 for day night.

So I'd guess if we could be looking at something like 27c 24hr rate if day night went to about 30/15.

Stevie2001

https://www.boards.ie/discussion/comment/120496044#Comment_120496044

Night makes a lot of sense then even if its only charging the car

magicbastarder

starting to think about our options for replacing our 11 year old octavia - and am very fond of the sheer practicality of the boot on it. but there's probably nothing close to it in the EV market?

Casati

Tesla are killing the competition on price - one real standout is the Mach-e.

Tesla Model 3 RWD is $39,990 in U.S. after govt discount and Ford cutting pricing- w Mach-e RWD 70kW is the same price - i.e. $39,990

Its a similar story in China where Ford cut Mach-e prices massively to match Tesla

https://www.carscoops.com/2023/03/ford-cuts-mustang-mach-es-prices-in-china-by-5700/

Here a Model 3 RWD is almost the same price as in the U.S. - circa €40k where as the Mach-e RWD 70kW here is €67,666.

Premium AWD long range Mach-e is €85,825 here is $54,995 in the States - which compares with the Model 3 Performance price of $53,000. Here we can now get a Model 3 Performance for €54,000. I know both countries have different grants and we have VRT and VAT

Volkswagen (and Skoda) are unlikely to reduce rrp but are very likely to effectively reduce prices by offering scrapple deals and very cheap packs. The other big tool they have is to drop PCP interest as needed. They did this for many years with Golfs and Tiguans - kept the rrp higher than competitors which helped to keep used prices also v high, but offered stuff like pano roof for €499 or PCP at 0% along with scrapple which artificially keeps trade-in prices looking high.

waterwelly

https://www.boards.ie/discussion/comment/120496095#Comment_120496095

And during summer it's until 9am so washing machines, showers etc. can all be run on night rate if there are early risers.

the_amazing_raisin

https://www.boards.ie/discussion/comment/120496459#Comment_120496459

Yeah that's what I do when the weather is looking overcast and I might not get enough solar to run the appliances during the day, I'll run dishwasher and washing machine overnight and then offload the washing to the dryer first thing so it's basically done by the time the night rate ends

Also FWIW, I've been driving on sunshine pretty much since the start of April. If you're a low mileage user then you can get a large percentage of driving from solar alone

Red Silurian

https://www.boards.ie/discussion/comment/120494770#Comment_120494770

I always work on the average car model, a car that can do 4.5L/100km and a car that can do 17kWh/100km

At these rates a liter of fuel needs to be 3.7 times that of a kWh of electricity for parity so at the moment liquid fuel is about 1.60/L meaning 43c/kWh is parity

One thing about the above calculation though, how much tax is about to go back on the liter of liquid fuel? Is it 15/20c... And for how much longer will a kWh of electricity stay this high?

daheff

https://www.boards.ie/discussion/comment/120496162#Comment_120496162

There's an interesting point in here somewhere on PCPs and VW keeping prices up. I guess they have a vested interest in Keep prices up as they have a number of cars sold on PCP with a reasonably high minimum value at the end of the term. If the let the prices drop too quickly the might find people handing back keys at the end of a PCP term as it cheaper to buy a similar aged car second hand.

the_amazing_raisin

https://www.boards.ie/discussion/comment/120496634#Comment_120496634

Wouldn't the cheapest option at the end of a PCP be to buy out the car? For example the GMFV of a 2021 ID.4 1st Max is ~€24k

Can't see anyone getting an equivalent EV for €24k

Other option is to sell and pay off the loan, then use the equity to buy another car.

I would imagine VW will use that lever to keep customers coming back, probably offer a high trade in value for existing ID cars

the_amazing_raisin

https://www.boards.ie/discussion/comment/120496604#Comment_120496604

Also worth remembering that oil is currently sitting around $85 per barrel, which isn't as high as 2022 prices but still quite high. And with OPEC doing production cuts to drive up the price then I could see the price of petrol going up again

I don't think it'll go over the €2 mark again, but remember pre COVID it was around €1.20 IIRC, so even now we're still seeing high prices at the pumps

Electricity is a bit harder to call, there seems to be a game of chicken going on between the suppliers as to who will drop prices first

They're also locked into long term price contracts, so they're still paying premium rates for gas and it's still quite expensive compared to pre COVID

Normally it seems to be Energia or SSE who announce price cuts to try and tempt in some customers, but they're probably sitting on it waiting for one of the big suppliers to do something

Jakey Rolling

https://www.boards.ie/discussion/comment/120496154#Comment_120496154

I'm the same, our dog practically lives in the boot of my Octavia.

Considering the MG5, dealer in Cork said they should have demo model in September. Range not the best, but price is attractive.

MojoMaker

MG5 same dimensions as Focus estate if you're comparing - i.e. short of the Octavia's dimensions for what it's worth.

Additionally - and it's worth considering - after a few weeks you will start to feel like a taxi, even if you aren't, because the only other MG5s you'll see about the place will be taxis.

Gumbo

https://www.boards.ie/discussion/comment/120496604#Comment_120496604

ESB rates should drop by the end of the year. They hedge purchase the power a year in advance. We should be seeing drops after the summer hopefully!

daheff

https://www.boards.ie/discussion/comment/120496890#Comment_120496890

My point is that VW won't want prices to drop.

If your GMFV is (say) 20k and second hand market is 15k then why would you not hand back the keys and buy second hand?

GMFV is set off the New price. If cars for the next few years are cheaper, second hand prices will drop, but cars GMFV won't. So it's in VWs interest to keep prices up, not to let them drop off.