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Illustration for article titled Battery Swap Stations Are Gaining Momentum In China — Screenshot: Nio

The simplest and most genius-brain solution to charging times and range with EVs isn’t one you’ll find in America. In China, though, it’s gaining ground. All that and more in The Morning Shift for June 2, 2021.

1st Gear: China Is An Alternate Universe For EVs

China is like the American car market in so many ways. It’s huge, for one, (the biggest in the world while we’re number two) and filled with people inexplicably buying sedans and not hatchbacks or wagons. It’s also the biggest market for electric cars in the world, and you see as many Teslas bopping around Shanghai as you do here in New York or Los Angeles.

But China also offers us a market where GM builds small, adorable, unbelievably popular EVs as opposed to 9,000-pound hulking Hummers for the rich. It feels like an alternate reality where everyone takes EVs as a given, not as a radical tech.

This is a long intro to the point that battery-swapping stations are taking off there, as noted in this overview story by Automotive News China:

Until 2019, state-owned BAIC Motor Co. and EV startup Nio were the only two automakers offering battery swap services for customers.

[…]

Competition from Tesla and Nio’s success in gaining customers with battery swap services have prompted other Chinese EV makers to take bold steps.

[…]

While Geely is constructing battery swap stations on its own, other Chinese automakers have opted to build facilities along with domestic companies to share costs.

In September, state-owned Changan Automobile Co. launched its first battery swap station in Chongqing along with a consortium of other major domestic companies.

The partner companies include CATL, China’s largest EV battery maker; Aulton New Energy Vehicle Technology Co., a Shanghai-based battery swap station operator; and State Grid, a state-owned power grid operator.

In March, SAIC Motor Corp., another major state-owned automaker, also teamed up with Aulton to kick off operation of the first battery swap station for its EVs.

Aiways, an EV startup, tapped Blue Part Smart Energy, an EV charging facility operator under BAIC, in April to offer battery swap services.

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This is all interesting to see from an American perspective, especially one based out of New York City. Around the turn of the century, NYC was home to the largest electric car company in the world, the Electric Vehicle Company, and it operated using battery-swapping stations right in the middle of Manhattan. The tech is basic. We could go down this route if we wanted to.

2nd Gear: Another Tesla Recall

Some 6,000 Tesla Model 3 and Model Ys are getting recalled for loose brake caliper bolts, as Reuters reports:

Tesla Inc (TSLA.O) is recalling nearly 6,000 U.S. vehicles because brake caliper bolts could be loose, with the potential to cause a loss of tire pressure, documents made public on Wednesday show.

The recall covers certain 2019-2021 Model 3 vehicles and 2020-2021 Model Y vehicles. Tesla’s filing with the National Highway Traffic Safety Administration (NHTSA) said it had no reports of crashes or injuries related to the issue and that the company will inspect and tighten, or replace, the caliper bolts as necessary.

Tesla said that loose caliper bolts could allow the brake caliper to separate and contact the wheel rim, which could cause a loss of tire pressure in “very rare circumstances.” The company said that, in the “unlikely event” there is vehicle damage from a loose or missing fastener, it will arrange for a tow to the nearest service center for repair.

Hey, at least they got the bolts on there this time!

3rd Gear: Everyone Is Copying How Elon Talks

Another interesting Tesla story comes from Bloomberg, which has taken notice that everyone is not just copying Tesla’s plans to make attractive and desirable electric cars, but also how Tesla talks them up with ever-grander terminology. Per Bloomberg:

Many of the words speak to the sheer scale of Musk’s ambitions, which are always far grander than people realize initially. A battery factory isn’t just a battery factory, it’s a Gigafactory. (Giga comes from the Greek word “gigas,” or giant.)

A fast charging station for Tesla’s electric cars isn’t just a charging station, it’s a Supercharger. (Tesla has more than 25,000, giving them the largest network in the world.)

The battery packs that Tesla sells to utilities that promise “massive energy storage?” Megapacks.

There are no signs of him stopping. At Tesla’s “Battery Day” in September 2020, Musk talked about reaching “Terawatt-hour” scale battery production. “Tera is the new Giga,” Musk said on stage.

We’ve now reached the point where every battery factory — even those being made by competitors — is called a gigafactory, regardless of its physical size or planned output. “Nissan in advanced talks to build battery gigafactory in UK,” reported the Financial Times. “Stellantis discussing conditions with Rome to build gigafactory in Italy,” said Reuters.

Would Tesla be where it is if everyone just called gigafactories what they are? (They’re just regular factories.)

4th Gear: Toyota Scaling Back Olympic Plans

The Olympics in Japan seem to be still on somebody’s schedule, even if the people of Japan seem less than stoked on a global travel-fest in the midst of a still-ongoing global pandemic. Of course, this has huge implications for … high-profile industrial manufacturing that hopes to use the Olympics as a sales and marketing opportunity! Reuters has a broad report on it, and I’ll just take out this little section on Toyota:

For global sponsor Toyota Motor Corp., the Games were a chance to showcase its latest technology. It had planned to roll out about 3,700 vehicles, including 500 Mirai hydrogen fuel-cell sedans, to shuttle athletes and VIPs among venues.

It also planned to use self-driving pods to carry athletes around the Olympic village.

Such vehicles will still be used, but on a much smaller scale — a “far cry from what we had hoped and envisioned,” a Toyota source said. A full-scale Olympics, the source said, would have been a “grand moment for electric cars.”

A Toyota spokeswoman declined to comment on whether there were any changes to its marketing.

5th Gear: Biden Blocks Trump Plan For Arctic Drilling In Alaska

This is not a total win for climate, but it’s something, as the Financial Times reports:

The Biden administration has announced it will suspend the Arctic oil drilling rights sold in the last days of Donald Trump’s presidency, reversing a signature policy of the previous White House and handing a victory to environmentalists.

[…]

Tuesday’s decision marked a victory for environmentalists and activists, a pillar of Biden’s support in last year’s election, who have begun to grow impatient with some of the White House’s climate actions. The administration recently opted not to intervene to force the closure of the controversial Dakota Access Pipeline and has supported a major Alaska oil project approved during Trump’s term in office.

“In general the Biden administration is acting vigorously on climate change,” said Michael Gerrard, founder of the Sabin Center for Climate Change Law at Columbia University. “This action on ANWR is quite consistent with that. The actions on the other two projects do not seem so consistent.”

I’ll take anything I can get at this point!

Neutral: How Is Your Car?

My Bug refused to start the other day just as I had loaded the car up for a multi-day road trip. With rain coming down, it refused to start even when I flagged down a ‘90s Infiniti for a jump. I ran out and got a new battery and it did start, but was running like shit until I found a half-bare wire leading to the coil. Some electrical tape later and we were on the road, though I’m still finding the car getting hot and leaking oil around some seals I know I just replaced. Stopping after one mountain pass I saw vapor rising out of one of the two carburetors. Time for a tune-up!

Illustration for article titled Workhorse Didn't Get The USPS Mail Truck And Now It's Being Sued — Photo: Workhorse

The United States Postal Service revealed last month that it had chosen Oshkosh Defense to make the next USPS mail truck, which meant that Workhorse, another bidder for the contract, lost. And with that loss came a steep drop in Workhorse’s stock price. Now one investor has sued.

The suit, filed Monday by Sam Farrar in U.S. District Court in California, alleges fraud, and highlights a number of quotes from Workhorse executives ahead of the USPS’s announcement on February 23. The quotes are intended to show that Workhorse led investors on about the possibility of getting all or part of the USPS’s contract for new mail trucks, inflating its stock price as a result.

For example, here’s what Workforce’s CFO Steve Schrader said less than a month before the USPS announcement, as quoted in the lawsuit. (Emphasis added in the lawsuit.)

On January 28, 2021, CFO Schrader sat down for an interview with the host of a popular Youtube channel focused on investing in the stock market. The pertinent part of that conversation is as follows:

HOST: So Workhorse has been doing fantastic things as of late, over the last month or so in particular, and there’s a few things I really want to speak about today. Now the first one is, Steve, I’d just like to hear your thoughts on Biden saying that the entire federal fleet will be replaced with electric vehicles, specifically American electric vehicles. And I know we can’t speak about the USPS contract, even though that’s what the entire comment section is probably asking us about, but I’d just like to get your thoughts on his statements and what it could potentially mean for Workhorse going forward.

SCHRADER: Yeah, I think the President’s announcement was huge, for several reasons, right? It’s, one, supportive of the E.V. (“electric vehicle”) market. It’s, two, all-American, like you said, all-American product buy. And I think he also said a lot about small businesses, and purchasing, whether it be parts or final products, from small businesses, too. So I think that’s huge. I think it’s meaningful that he did this his fifth day into his presidency, right? He did it quickly; he didn’t really wait and so I think that, putting a move on that was very quick too. I think it’s also meaningful that, when you think about it, when the government gets behind things, things happen.

And in this case, it’s, the government actually is maybe somewhat behind the commercial market. As you well know, customers are already demanding these products, right? Investors are already looking at companies that are making these products, so I think everybody sees that E.V.s are kind of the way of the future going forward, and they see – customers see – the savings opportunities and I think what probably has, the only thing that has been missing, to some extent, is that now you’ve got the government behind it, from a standpoint of environmental, you know, and just – savings opportunities going forward. So, yeah, having the government push us and the President come out, like I said, five days after his inauguration, is huge.

HOST: It was nice and quick. And as you just said, I think that’s exactly what we wanted to see. I mean, we’ve spoken a few times now and you’ve made it very evident that a lot of the people who actually want to buy these trucks – I think every fleet manager in the country at this stage is now heavily contemplating E.V. more so than traditional[] vehicles, from a savings point of view. I think the government to an extent were a little bit behind, so they’re seeing something like this come from the President himself, that has to be a huge catalyst to pretty much everybody involved, especially the all-American owned ones, which we know you guys stand very heavily for. So that’s awesome; that’s just awesome. And that, obviously, it’s a very good thing.

SCHRADER: Yes. It’s a very good thing . . . .

Now, you can read that as Schrader intimating that Workhorse thinks its chances of getting the USPS contract are good, or you can read that as Schrader simply saying that the U.S. government putting its weight behind electric cars is good in general for Workhorse, an EV company. But it’s somewhat gray, and it’s in the gray where lawsuits like this often operate.

I emailed Workhorse and will update this post if they reply. The company said last week that it had met with the Postal Service and, well, stay tuned.

Yesterday’s meeting with the USPS marked the first step in what we expect may be a prolonged process to explore our options and possibly pursue further action related to our NGDV bid,” said Workhorse CEO Duane Hughes. “We will continue to follow the proper due course procedures as defined by the USPS and will also look to other options available to us. In the interim, we have retained the services of leading legal and corporate advisory firms, including Akin Gump Straus Hauer & Feld LLP and Mound Cotton Wollan & Greengrass LLP, to identify our options and pursue them effectively. We appreciate the support of the many private and public stakeholders who have expressed an interest in supporting us and will continue to share updates as we are able.

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You can read Farrar’s full complaint below.

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Battery Swap Stations Are Gaining Momentum In China